(Montreal) Even if it has recently attracted criticism, the forgivable loan mechanism is “win-win”, according to Prime Minister François Legault, who wants to extend its scope in exchange for “paying jobs”.
Posted on March 15, 2021 at 3:49 p.m.
Updated at 4:43 p.m.
–
–
From now on, a company which proposes to invest at least 10 million or to create more than 100 jobs will be able to apply for this measure, which is in a way a conditional subsidy.
Quebec announced on Monday the addition of the Support for transformative investment projects (SPRINT) component to the ESSOR program, which is administered by Investissement Quebec, the financial arm of the Quebec government.
“We come to say to companies: part of the loan that we make to you will be forgivable, will become a subsidy, in as much […] that you are creating a certain number of jobs at a salary higher than the average salary in Quebec, ”said Premier François Legault, in an announcement concerning the company Lion Électrique.
The manufacturer of electric buses and trucks has secured $ 100 million from Quebec and Ottawa to finance its battery pack assembly plant in Saint-Jérôme, a project with an estimated bill of $ 185 million. About 30% of the loan granted by the Legault government will be forgivable while the entire 50 million offered by the Trudeau government could turn into a grant.
On more than one occasion since its election, the Legault government has opted for the forgivable loan formula.
As recently as last week, the French giant Alstom obtained one of 56 million to modernize the ex-factory of Bombardier Transport in La Pocatière. This decision aroused some discontent, in particular from certain opposition parties since the entire loan could turn into a grant.
“We want, for a number of years, to explode private investment in Quebec to eliminate this wealth gap between Quebec and Ontario and the rest of Canada,” said Mr. Legault.
Since 2019, companies like Mitsubishi (12 million, which have been repaid), Premier Tech (15 million) and the specialist in space robotics MDA (50 million) have obtained loans, part of which is non-repayable if certain criteria are met. .
In order to benefit from the measure announced on Monday, a project will have to be accompanied by new jobs with a salary higher than the average annual salary of the region where it is to be carried out.
Financial assistance will take the form of an interest-free loan of up to 25% of eligible expenses. A pardon could be granted on the basis of the number of jobs “created or consolidated”. It would be $ 25,000 for each position with an annual salary of $ 55,000 and it could reach $ 50,000 if the salary is at least $ 150,000.
It is during the fifth year following the granting of the loan that a company could see part of the amount lent turn into a grant. Repayment must be made within eight years for the portion of the loan that has not been forgiven.
–
