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Small businesses hurt by roadwork must be compensated: Which municipality will lead the way?

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CFIB challenges local governments to act now

Toronto, May 30, 2018 – On the eve of the annual conference of the Federation of Canadian Municipalities, the Canadian Federation of Independent Business (CFIB) challenges municipalities to show leadership by quickly starting to compensate small and medium-sized businesses that are bearing the brunt of roadwork. 

As highlighted by CFIB’s recent report Paving a Smoother Road: Helping small businesses survive infrastructure work, as many as 65,000 businesses have been seriously affected by infrastructure projects since 2012, often having to borrow, relocate or close down altogether. 

“Municipal governments will undertake infrastructure projects at a cost of hundreds of billions of dollars over the next few years, without truly factoring in the costs shouldered by small businesses. Right now, too many businesses are seriously affected by poor planning. It can ultimately drive them out of communities, with their neighbourhoods in turn suffering the consequences of that loss. We are turning to our municipal leaders and asking them to stand with local business and take up CFIB’s challenge to adopt a compensation program for the worst cases,” said Simon Gaudreault, CFIB director of economic affairs.

How it can be done 
There are many effective compensation measures already in place in municipalities around the world, such as:

  • In Brussels, smaller merchants that must remain closed for at least one week because of public construction are entitled to a daily compensation of about $117.
  • Seattle has provided over US$15 million in mitigation funds to businesses affected by the construction of a new light-rail line and announced a new help fund in addition to taxes and fees deferrals for business impacted by a major local road construction project.

A comprehensive plan 
According to CFIB’s recent report, seven out of 10 businesses surveyed are dissatisfied with how local governments have handled the negative impacts of construction projects. Therefore, CFIB recommends that all Canadian municipalities adopt a coherent construction mitigation policy that would include, in addition to a compensation program, a “no surprise” rule, a comprehensive planning approach, an improved contracting process and a business liaison officer for each project. 

“Municipal governments must take action to improve the management of construction projects and support small businesses by adopting solid mitigation policies. Any mitigation plan must include, first and foremost, a form of compensation for small businesses that are hit the hardest,” concluded Gaudreault. “We look forward to congratulating the first municipalities to take up our challenge.”

About CFIB
CFIB is Canada’s largest association of small and medium-sized businesses with 110,000 members across every sector and region. Learn more at cfib.ca.

For media enquiries or interviews, please contact:
Milena Stanoeva, CFIB
647-464-2814
[email protected]