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March 19, 2020 - Fernie Chamber update on the COVID-19 situation, impacts and relief

Posted: 
Wednesday, March 25, 2020 - 12:11

Good afternoon Fernie Chamber members,

Since we issued our last statement on Tuesday, the situation related to COVID-19 has continued to evolve rapidly by the hour. In this statement we want to address the economic impacts currently facing our local business community, what this crisis may look like over the coming months, how you can respond as a business, and finally what the provincial and federal governments have announced to help businesses and workers.
 
What We Know Today

·         Everyone should be continuing to practice common sense preventative measures like regularly washing your hands, covering your face when coughing, social distancing, and staying home when sick.

·         Those that have weaker immune systems (including the elderly) should be especially careful and consider self-isolating.

·         Many businesses and facilities in Fernie are now closed or have reduced service levels. The Fernie Chamber and Tourism Fernie are actively collaborating to bring our community the latest information. Continue to check this resource for the latest on business closures and what innovative things local businesses are doing to serve their customers during this period of self-isolating: https://tourismfernie.com/news/coronavirus-covid-19

   (to provide an update from your business please email jesse@ferniechamber.com)

·         Gatherings or events of more than 50 people should be cancelled or postponed. Use of technology to hold meetings remotely or virtually is strongly encouraged.

·         Anyone returning from abroad should self-isolate for 14 days.

·         Phone numbers have been setup in BC for information regarding COVID-19:

o    Dial 811 for medical information (including if you believe you are showing symptoms of COVID-19)

o    Dial 1-888-COVID19 for non-medical related inquiries including travel advisories and relief tools available for businesses/workers

·         The Bank of Canada has asked retailers and businesses to keep accepting cash amid the COVID-19 pandemic.  They have warned that refusing cash could put an undue burden on people that depend on cash as a means of payment.

·         Further to Monday’s announcement by the federal government regarding the closure of Canada’s border to all non-Canadians, the US/Canada border will be closed for non-essential travel. The Prime Minister indicated today that the US/Canada border closure will come into effect tomorrow night (Friday 20 March).

·         The federal and provincial governments are taking the economic impact of the situation seriously, freeing up cash and resources for relief efforts for businesses, workers and citizens impacted. We have updated what we know so far below.

·         The Fernie Visitor Information Centre remains open from 9am to 5pm and is a valuable resource for visitors, residents and businesses. The facility is taking all precautions and is prepared to move to a virtual contingency model where information assistance will still be available via phone, email and social media in the event we have to close the physical location.

 

Key Authoritative Information Resources

·         Health Link BC

·         BC Centre for Disease Control

·         Health Canada

·         Destination BC 

·         Destination Canada 

·         Canadian Chamber of Commerce 

·         BC Economic Development Association

·         Department of Finance Canada

 

BC Chamber Survey
The BC Chamber of Commerce launched a survey using their MindReader platform regarding the financial impacts of COVID-19 last Friday with the survey closing yesterday. There were almost 8,000 responses from businesses across BC including our region. The highlights from the results of the survey (which has been shared with the provincial and federal governments) are:

·         90% of businesses are “currently being impacted by COVID-19”

·         Of those impacted, 83% are seeing a “drop in revenue, business, or deal flow”

·         91% anticipate a further “decrease in revenue in the near-term” [sic]

·         73% of businesses expect their revenues will drop by 50% or more (with nearly a quarter saying revenues will drop by 100%)

·         Half of the respondents say they will be “temporarily shutting down” their offices.

·         64% of respondents expect to reduce their staff by over half (with a quarter saying they will be reducing their staff by 100%)

 

What the Next Few Months Could Look Like
The growing consensus among experts is that the global economy is facing the biggest financial crisis of our lifetimes – much more significant than the financial crash of 2008. What we are also all now realizing is this won’t impact us for weeks; it will be months.

Jikke from Tourism Fernie and myself sat in on a webinar yesterday delivered by Roger Brooks from the Destination Development Association on the topic Dealing With the Coronavirus. During the presentation he suggested that based on the best science we have now, daily business-as-usual operations for all businesses may not be possible for at least 90 days – taking us to mid-June.

So we should be prepared as a business community that things may not be spooled-up and returned to business as usual until Canada Day, realistically. That is sobering to hear but we should be prepared for this worst case scenario and act accordingly to protect our businesses, staff, customers and vendors.
 
 
 
Looking Out for Workers
We understand that payroll is the biggest expense for many of our businesses and that in order to survive some difficult decisions are having to be made with regards to laying off staff. We need to look after our workforce in the interim, if we are to reopen at full capacity once this crisis has passed – we need them. So please try to ensure their financial security as best you can as employers. Where possible try your absolute best to retain your workers and take advantage of some of the relief programs outlined below. All employers are reminded that they are still to act in accordance with the BC Employment Standards Act with regard to dismissal of staff.

If you have to make the difficult decision to lay off staff, please make issuing a Record of Employment (ROE) a matter of priority so that your staff can apply for and receive EI in a timely fashion. Move up your payroll date if it makes it faster. Staff can always be hired back once the crisis is over, but you need to ensure their financial stability in the interim. Please note, there is a difference between temporarily laying off staff (and eventually recalling them) and a permanent termination. Communicate with your staff openly and honestly about the situation. With their consent, you are able to negotiate a temporary reduction in hours.
 
For more information on this, please refer to Employment and Social Development Canada and the Canadian Government Resources for Businesses page.
 
Federal government support for workers/individuals announced yesterday:

·         Waiving the one-week waiting period for those individuals in imposed quarantine that claim Employment Insurance (EI) sickness benefits. This temporary measure is in effect as of March 15, 2020.

·         Waiving the requirement to provide a medical certificate to access EI sickness benefits.

·         Introducing the Emergency Care Benefit providing up to $900 bi-weekly, for up to 15 weeks. This flat-payment Benefit would be administered through the Canada Revenue Agency (CRA) and provide income support to:

o    Workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits.

o    Workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not quality for EI sickness benefits.

o    Parents with children who require care or supervision due to school closures, and are unable to earn employment income, irrespective of whether they qualify for EI or not.

·         For Canadians who lose their jobs or face reduced hours as a result of COVID’s impact, the government is:

o    Introducing an Emergency Support Benefit delivered through the CRA to provide up to $5.0 billion in support to workers who are not eligible for EI and who are facing unemployment.

·         Implementing the EI Work Sharing Program, which provides EI benefits to workers who agree to reduce their normal working hour as a result of developments beyond the control of their employers, by extending the eligibility of such agreements to 76 weeks, easing eligibility requirements, and streamlining the application process.

·         In order to provide greater flexibility to Canadians who may be experiencing hardships during the COVID-19 outbreak, the Canada Revenue Agency will defer the filing due date for the 2019 tax returns of individuals, including certain trusts.

o    For individuals (other than trusts), the return filing due date will be deferred until June 1, 2020. However, the Agency encourages individuals who expect to receive benefits under the GSTC or the Canada Child Benefit not to delay the filing of their return to ensure their entitlements for the 2020-21 benefit year are properly determined.

There are other measures in place for individuals, and more to be announced. Keep checking these pages for more information on these resources for the latest updates:
 

·         https://www.canada.ca/en/department-finance/economic-response-plan.html

·         https://www.canada.ca/en/services/business/maintaingrowimprovebusiness/resources-for-canadian-businesses.html

·         https://www.canada.ca/en/department-finance/news/2020/03/canadas-covid-19-economic-response-plan-support-for-canadians-and-businesses.html

·         http://www.chamber.ca/resources/pandemic-preparedness/

 

Weathering the Storm & Preserving Cash Flow
While your employees should be a key consideration, you also need to ensure the longevity of your business and your ability to weather this storm over the coming weeks and months.

A key piece to keep an eye on during this stressful time is the old concept – cash flow is king. Businesses need to be looking at ways they can free up their cash flow in the immediate short term in order to cover fixed costs and be in a position to re-open after the crisis has passed. Businesses in Fernie will be no stranger to cash flow management, given our wildly fluctuating seasonal demand cycle. But now is the time to really scrutinize every expense. Keep in mind that some of the government relief measures described below will not hit the ground until April.

As part of that cash flow management effort, I would encourage you to take advantage of some of the measures already in play to help businesses and individuals with their cash flow at this uncertain time. There are an increasing number of vendors that are allowing deferred payments at this time, such as:
 

·         All major banks are offering up to a 6-month payment deferral on mortgage repayments.

·         Major utilities like BC Hydro and Fortis BC are also offering to defer bill payments or arrange for flexible payment plans with no penalty.

·         Have a frank and honest conversation with your landlords to see if they are willing to offer the same. A lease agreement is a partnership, and it is in the landlord’s interest to ensure their tenant can weather this storm and remain open to continue the lease term.

·         We encourage the City of Fernie to consider offering the same type of arrangement on utility bills for businesses and individuals, and we are pleased to hear they are looking into it along with property taxes.

·         Other organizations such as Community Futures East Kootenay are looking at emergency lending to local businesses and we will share these other opportunities as they are announced.

 
Government Relief Updates
The Federal Government of Canada yesterday announced a suite of measures as part of their economic response plan to help offset the financial impacts of the COVID-19 pandemic on Canadian businesses and individuals. The measures will be worth a combined $82 billion, and this includes $27 billion in direct support for individuals and companies and $55 billion in temporary tax deferrals for both households and businesses.

They made a point of stressing that this is the first phase of measures, and that more relief is on the way – which is encouraging as the business sector will need a lot more than is currently on offer. The provincial government’s economic response is still being developed with a view to filling in the gaps of the federal economic impact plans. As soon as an announcement is made provincially, we will provide an update.

What was announced yesterday federally includes:
 

·         Flexibility for Businesses Filing Taxes:

o    The Canada Revenue Agency will allow all businesses to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020.

o    The Canada Revenue Agency will not contact any small or medium (SME) businesses to initiate any post assessment GST/HST or Income Tax audits for the next four weeks.

o    The Liaison Officer Service offers help to owners of small businesses to understand their tax obligations. Traditionally available in-person, this service is now available over the phone and will be customizing information during these challenging times by ensuring small businesses are aware of any changes such as filing and payment deadlines, proactive relief measures, etc.

 

·         Ensuring Businesses Have Easier Access to Credit:

o    The Business Credit Availability Program (BCAP) will allow the Business Development Bank of Canada (BDC) and Export Development Canada (EDC) to provide more than $10 billion of additional support, largely targeted to small and medium-sized businesses.

o    The Office of the Superintendent of Financial Institutions (OSFI) announced it is lowering the Domestic Stability Buffer by 1.25% of risk-weighted assets, effective immediately. This action will allow Canada’s large banks to inject $300 billion of additional lending in to the economy.

o    The Bank of Canada also took a series of actions to support the Canadian economy during this period of economic stress, enhance the resilience of the Canadian financial system, and help ensure that financial institutions can continue to extend credit to both households and businesses. This included cutting the interest rate to 0.75% as a proactive measure.

 

·         Helping Businesses Keep their Workers:

o    To support businesses that are facing revenue losses and to help prevent lay-offs, the government is proposing to provide eligible small employers a temporary wage subsidy for a period of three months. The subsidy will be equal to 10% of remuneration paid during that period, up to a maximum subsidy of $1,375 per employee and $25,000 per employer. Businesses will be able to benefit immediately from this support by reducing their remittances of income tax withheld on their employees’ remuneration. Employers benefiting from this measure will include corporations eligible for the small business deduction, as well as non-profit organizations and charities.

 
For more information and how to apply for these measures:

·         https://www.canada.ca/en/department-finance/economic-response-plan.html

·         https://www.canada.ca/en/services/business/maintaingrowimprovebusiness/resources-for-canadian-businesses.html

·         https://www.canada.ca/en/department-finance/news/2020/03/canadas-covid-19-economic-response-plan-support-for-canadians-and-businesses.html

·         http://www.chamber.ca/resources/pandemic-preparedness/

 
 
Fernie Chamber and Visitor Information Centre Update
The Fernie Chamber of Commerce continues to operate on behalf of the local business community. Both myself and Kalina (Membership Services Coordinator) are working remotely and are available by email. All Chamber events for March and April are postponed until further notice – including our AGM originally scheduled for April 15.

As of right now, the Fernie Visitor Information Centre remains open from 9am to 5pm. This Saturday will be the last Saturday we will be open for the foreseeable future, we will then move to Monday to Friday from 9am to 5pm. We are taking all precautions at the Visitor Centre and are evaluating staying open on a daily basis. Some of the factors weighing into our decision process include the spike in call volume we have experienced with questions from visitors, residents and businesses. We are also the local depot for Purolator shipping, and we have noticed a pronounced spike in the delivery of packages as self-isolation causes more online shopping. We are also aware of at least several local residents who get their medicine sent through Purolator and we want to keep that service open as long as is reasonable.

We are prepared to move to a virtual contingency model where information assistance will still be available via phone, email and social media in the event we have to close the physical location.
 


Finally on a personal note, while we are focusing on our local economy and the financial impacts of this situation today, by no means do I intend to minimize the very real human element during this rapidly evolving pandemic response. This is a frightening and unprecedented time for all of us. In the past 48 hours, an ever-growing number of Fernie residents (both permanent and temporary) have lost their jobs just like that. Business owners and managers have made heartbreaking decisions regarding staffing and even closing their businesses down entirely without being sure as to when, or if, they will re-open. Working parents are dealing with the reality that kids will be out of school until September. Many of us are scrambling to figure out how we are going to pay our rent, our mortgage, our leases, our vendors, our bills. This is a stressful time.

I encourage all of you as leaders in our community to be strong, but also compassionate and empathetic during this time. People are vulnerable and hurting. Let’s make sure we look out for each other as friends, as neighbors, as a community.

Support local businesses wherever you can for those that remain open. That messaging is still important.

I am humbled every day to work with a business community filled with such passionate and innovative people. Our business community punches way beyond its weight for a town of our size, and we will rebound together. Thank you for your leadership and together we will get through this.
 
We will have the biggest Business Banter and Beer (BBB) this town has ever seen when this is all over!
 

All the best,
 
Brad Parsell – Executive Director
brad@ferniechamber.com
250 423 6868

Proud Community Partner