Ontario is making its ban on commercial evictions for some small businesses retroactive to May 1, after months of frustration from entrepreneurs who’ve seen revenue plunge from the COVID-19 crisis.
Premier Doug Ford announced last week that the province would ban evictions from June through August for businesses that are eligible for the national Canada Emergency Commercial Rent Assistance (CECRA) program, but whose landlords do not plan to apply. At the time, the province said evictions would only be nullified going back to June 3.
The Progressive Conservatives said they would expand the retroactive ban ahead of a vote late Wednesday to expedite the bill’s passage into law. Opposition New Democrats said they met with the PCs to discuss the bill Wednesday, hoping to make eviction protection retroactive to mid-March and extend it to all small businesses even if they didn’t qualify for CECRA – but that the governing party would not allow further changes.
A spokesperson for Municipal Affairs Minister Steve Clark said the legislation meant that any landlord who had changed the locks on a CECRA-eligible tenant for not paying rent after May 1 must let the tenant back to the unit. If the landlord has re-rented the space, they must pay damages to the evicted tenant, spokesperson Julie O’Driscoll said in an e-mail. Any seized goods must be returned, and if they were sold, the proceeds must be applied against the tenant’s unpaid rent.
Earlier this week, Alberta also added further protections for CECRA-eligible small businesses, banning any late fees, penalties or rent increases from landlords between March 17 and Aug. 31, and requiring reimbursements if tenants have already been charged. While Alberta has banned commercial evictions from this week until Aug. 31, its eviction protections are not retroactive like Ontario’s.
Revenues collapsed for many small businesses, especially restaurants and other storefront businesses, after widespread economic shutdowns in March. Though parts of Canada, including most of Ontario, have begun to gradually reopen, health precautions and public fears are expected to prevent revenue from reaching pre-pandemic levels. Yet many entrepreneurs have had to pay their fixed costs over the past three months – including rent, which is often their biggest bill.
Ottawa and the provinces announced the CECRA program in late April, nearly six weeks after pandemic shutdowns began, after significant lobbying from both entrepreneurs and advocacy groups such as Save Small Business and the Canadian Federation of Independent Business. The program covers half a tenant’s gross rent for April, May and June if the tenant agrees to pay a quarter and the landlord eats the final quarter of the costs.
Eligible businesses must have experienced at least a 70-per-cent decline in revenue because of the pandemic, have less than $20-million in gross annual revenue, and pay less than $50,000 in monthly rent.
But the onus to apply is on landlords, and very few have applied. Mr. Ford said when he announced the legislation last week that landlords had applied on behalf of just 7,000 of the province’s 418,000 small businesses.
As a result, Ontario and other provinces, including British Columbia, Alberta, Quebec and Nova Scotia, have announced eviction bans for small businesses that are eligible for CECRA but whose landlords have chosen not to apply. Some jurisdictions’ bans are very short-term or limited: New Brunswick was one of the first to implement a ban, but has since lifted it. British Columbia’s ban only runs until the end of June.