Although the coronavirus epidemic is a serious financial challenge to local governments, the vitality of businesses and communities in particular must be ensured. The City of Espoo has prepared a 25-point package of measures to support companies and sports and cultural actors. The Espoo Package provides financial support while taking account of smooth support processes. The effectiveness of the measures on which the City of Espoo has now decided will be actively monitored in cooperation with companies and communities. Among the measures is an appeal to property owners and shopping centres renting premises to companies and communities to be lenient with rent collection.
At its meeting on 6 April 2020, the Espoo City Board approved a package of measures that help companies and communities at risk to cope with the coronavirus situation.
“In addition to an acute liquidity crisis, there is a real threat of a significant increase in bankruptcies. We want to help companies and communities by all means available to us. It will serve everyone’s best interests to have these companies and communities viable and able to grow when the situation finally permits them to look into the future again,” says Mayor Jukka Mäkelä.
The coronavirus also puts a strain on municipal finances. Thanks to its financial position and liquidity, the City of Espoo can nonetheless take measures to ease the acute economic pressure on companies and associations.
“Extensive dismissals and bankruptcies would seriously affect the livelihoods and well-being of Espoo residents. They would also have a highly negative effect on the city’s tax revenue and ability to carry out its basic tasks,” says Ari Konttas, Director of Finances.
Forms of support easily accessible without unnecessary bureaucracy
“The package approved by the City Board is the first step towards overcoming the acute crisis. We provide financial support and smooth processes so that entrepreneurs will not need to spend energy on figuring out what they need to do. If the situation continues, the necessary measures should be assessed and updated through active cooperation between the city, companies and communities,” says Tuula Antola, Director of Economic Development.
The Business Espoo network that provides business services is ready to give its full support to local entrepreneurs. Business Espoo provides information on support opportunities, helps with applications and refers entrepreneurs to the legal and financial experts in its network. The Ministry of Economic Affairs and Employment is expected to issue guidelines on the granting of financial support to sole entrepreneurs. When the instructions on how to apply for a one-off operating subsidy of EUR 2,000 are ready, they will be published on the City of Espoo and Business Espoo websites.
“It is important that all forms of advice and support that we can offer in the coronavirus situation are made available to businesses and entrepreneurs in the best possible way. A sufficient number of customer service personnel is also needed. If necessary, we and the Business Espoo network can ensure this with the help of the resource pool that the City of Espoo has set up for the coronavirus period,” Antola says.
The focus of procurement and outsourced services is currently on ensuring the health, well-being and safety of Espoo residents and the uninterrupted operations of services that are essential for the operation of the city.
“We will make every effort to minimise and soften the negative effects on businesses and to make procurement and purchase decisions that support the continuity of business and city operations. We also support our contractors in managing their cash flow by changing our practices concerning purchase and sales invoices for the duration of the emergency period,” says Ari Erkinharju, Procurement Director.
Waivers of rent, exemptions from permit fees
The coronavirus situation also poses a challenge to exercise and sports clubs.
“The city has built facilities for some sports but not all. The rents charged for private premises are several times higher, and some clubs have taken out loans to build their own facilities. Our objective is to prevent these clubs from falling into financial distress by increasing the rental grants for sports facilities,” says Martti Merra, Director of Sports and Youth Services.
The city will support exercise and sports clubs with extra rental grants totalling EUR 300,000. An additional EUR 100,000 will be granted to sports clubs to help them overcome coronavirus-related challenges and to combat the acute threat of bankruptcy.
Cultural operators are also suffering from financial losses due to closed venues and cancelled events. The Culture Committee has decided that culture grants will not be claimed back even if the grant recipients’ operations change due to the coronavirus.
Companies and communities operating in city-owned premises will be granted a temporary waiver of rent between 1 April and 30 June 2020 if the emergency situation has stopped their operations. These entrepreneurs do not need to contact the City of Espoo, as the waivers will be applied automatically. Waivers of rent may also be granted to the following businesses operating in city-owned premises: restaurants and other catering services; shops; art, music and event activities; programme and party catering services; business incubators, growth services and other activities promoting entrepreneurship; hair salons; beauty parlours; exercise and wellness services including massage parlours and physiotherapy; and slots in market squares.
The City Board also decided that total or partial exemptions from permit fees collected by the city may be granted between April and June.
“In addition to taking measures to support our tenants in the coronavirus situation, we want to encourage both the city’s subsidiaries and our external cooperation and contractual partners to grant similar waivers and exemptions to their own tenants,” says Olli Isotalo, Director of Technical and Environment Services, naming shopping centres and property owners who rent facilities to sports clubs as examples.
Latest information on support for companies during the coronavirus situation on Business Espoo's website.