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No relief for business as Logan council rates notices issued

Businesses have been warned to swot up on new state and federal laws put in place during the coronavirus outbreak following the issue of rates notices across the southeast this week.

Logan Chamber of Commerce vice-president James Stokes with Extraction Artisan Coffee owner Alex Milosevic. Both want Logan City Council to do more to help small business during the coronavirus outbreak
Logan Chamber of Commerce vice-president James Stokes with Extraction Artisan Coffee owner Alex Milosevic. Both want Logan City Council to do more to help small business during the coronavirus outbreak

BUSINESSES have been warned to swot up on new state and federal laws put in place during the coronavirus outbreak as rates notices are issued across the southeast this week.

Logan Chamber of Commerce said those who did not understand the new regulations could get tangled in legal webs over unfair dismissals and new bankruptcy and insolvency laws.

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The chamber put the pressure on the local council for rental relief after notices were issued and “hundreds” of inquiries about the best way to go about dismissing staff, dealing with debt and ending lease contracts.

There are more than 21,000 businesses operating in Logan, employing more than 93,000 people.

Chamber vice-president James Stokes, a Logan-based lawyer, said many small businesses were unaware that the federal government had relaxed insolvency laws until September 24.

He said sections of the federal Corporations Act and Bankruptcy Act have been relaxed to allow businesses to trade while in debt up to $20,000.

Many businesses were also confused about legal obligations for commercial leases and rental agreements with inquiries stepping up this week after Logan City Council rates notices were issued.

“Our main inquiry has been from businesses wanting to know the best way to negotiate rent relief with landlords,” he said.

“Under the Code of Conduct for commercial tenancies, landlords must reduce rent in proportion to a tenant’s reduction in turnover.

“But this only applies to a tenant who has an annual turnover of up to $50 million and can show they have suffered financial hardship from COVID-19.”

A tenant is deemed to be in financial hardship if they suffer a 30 per cent reduction in turnover compared to the same period last year.

Mr Stokes said Logan food service businesses had been particularly affected by coronavirus chaos as they had been barred from opening under a federal government decree.

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However, he said he was dismayed at the lack of financial assistance on offer from the local council.

He said the council claimed it was unable to waive rates for the entire quarter for commercial properties but admitted it could reduce them.

“The current discount offered by council is $26 on rates of over $1000, which is just the usual hardship discount,” he said.

“The only rates relief the council is giving out is to defer payments and relaxing interest payments - but that’s just kicking the can down the road.

“The council is not operating its pools, libraries and a range of other services so any savings should go to these strugging companies.

“The chamber is really concerned about cafes and restaurants after we struggled for years to build up a food culture in Logan only to have it decimated by the coronavirus.”

Extraction Artisan Coffee owners Alex Milosevic and Heather Scott were still paying rates on their Slacks Creek premises where they had spent “thousands” on fitouts, staffing and decor.

Mr Milosevic said if the council was serious about helping small business, which employed many young workers across the city, it would cut rates for food-based businesses.

“I realise there is no council at the moment so it can’t act immediately but the council could do more than just halving this year’s licence fees for businesses,” Mr Milosevic said.

“We are waiting for the federal government’s JobKeeper program to start paying in May but we have also developed our business and added a home-cooked meal service in the meantime.”

Administrator Tamara O’Shea unveils a support package for ratepayers.
Administrator Tamara O’Shea unveils a support package for ratepayers.

Logan City Council unveiled a support package on March 25 which included the 50 per cent refund for operational licence fees, extending the $26 hardship arrangements to non-residential property owners and the interest-free period for the current rates and charges to September 30.

Once the new mayor and 12 divisional councillors are declared and sworn-in, they have the option to consider additional economic support as a component of the upcoming budget.

The council said fees would also be waived for any new licence applications received up until August 31.

Business owners who need further advice can contact the Logan Office of Economic Development (LOED).

MANDATORY CODE OF CONDUCT FOR LEASES

applies to a tenant who has an annual turnover of up to $50 million and suffers “financial hardship” as a result of the COVID-19 pandemic.

A tenant is deemed to suffer financial hardship if they suffers a 30 per cent reduction in turnover compared to the same period last year.

The Code will apply for the period during which the Commonwealth JobKeeper program is operational.

LANDLORDS

Must not terminate the lease for non-payment of rent.

Must not make a claim on a bank guarantee or a security deposit for non-payment of rent.

Must not penalise the tenant for ceasing trade or reducing trading hours.

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Original URL: https://www.couriermail.com.au/questnews/logan/no-relief-for-business-as-logan-council-rates-notices-issued/news-story/805fe4df86db4db76aa0e284f17d96ae