$50 Million Assistance Program to Support Businesses in Quebec Affected by Forest Fires

A $50 million assistance program will support businesses in eight regions of Quebec that are facing difficulties due to forest fires of unprecedented magnitude. In some areas, notably in Abitibi-Témiscamingue, entire towns were evacuated, forcing the temporary closure of a series of businesses — and depriving a large number of workers of income.

Economic activity has also been paralyzed by the bans on access to public forests and the closure of forest roads decreed since the beginning of June.

The government assistance, which will take the form of loans and loan guarantees, represents a balm for companies which are undergoing these difficult circumstances, underlined Christopher Skeete, Minister Delegate for the Economy, during a press conference on Wednesday in La Sarre, in Abitibi-Témiscamingue.

“I am aware that it is a loan, it is not ideal, I can understand, said the minister. On the other hand, for me, I consider that for the moment, it is the thing to do. He added that the program also “allows businesses to pay employees.”

These measures target businesses in most sectors of activity, including sawmills, paper mills, outfitters, tourism businesses and local businesses, he explained.

Certain companies from 23 RCMs located in eight regions (Abitibi-Témiscamingue, Côte-Nord, Lanaudière, Laurentides, Mauricie, Nord-du-Québec, Outaouais and Saguenay–Lac-Saint-Jean) will be eligible.

Loans and loan guarantees of a maximum of $50,000 per business are intended to support the working capital necessary for its operation. The value of the loans will be determined according to the liquidity needs of each over a period of three months from the start of the ban on access to the forest.

To be eligible, companies will have to “demonstrate a cause and effect link between their financial or operational problems and their situation in relation to the forest fires”, explained the minister. They will have to show a lack of liquidity due to the impossibility of delivering more than half of their products or receiving more than half of their supplies for four consecutive weeks.

I’m aware it’s a loan, it’s not ideal, I can understand.

The loans will carry an interest rate of 4.25%, “a favorable rate that is lower than the market rate”, according to Christopher Skeete. Businesses will be able to take advantage of a capital repayment moratorium of 3 to 12 months, beyond which loans will be amortized over 36 months, in most cases.

Assistance to outfitters

Outfitters will be entitled to special treatment. “The tourism industry, in recent years, has been deeply affected,” lamented the Minister of Tourism, Caroline Proulx.

As part of the new assistance program, the government is proposing “a measure that specifically adapts to the situation of businesses that operate an outfitter in Quebec,” revealed Ms.^me Proulx, due to their significant liquidity needs. The amount of loans granted to outfitters will be calculated on the basis of working capital needs over a period of 18 months – instead of 3 for other companies – from the start of the forest access ban.

The Minister specifies that even if outfitters are entitled to special treatment, all tourism businesses that qualify will be able to take advantage of the assistance offered, in particular accommodation businesses, festivals and campgrounds.

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