COVID-19 PLANNING: GOVERNMENT FUNDING FOR YORK REGION TECH BUSINESSES

York Region Economic Strategy is committed to supporting the York Region business community during this difficult and uncertain time due to the COVID-19 pandemic. In partnership with Mentor Works, an organization with expertise in helping businesses develop plans to access government funding programs, we have planned a series of articles that can assist businesses in navigating these difficult times and build a recovery plan as the economy moves towards returning to normalcy.

**Blog updated on 05/06/2020**

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With York Region being Canada’s second-largest tech hub (4,300+ firms and 60,000+ tech-based jobs), it’s a no-brainer that companies of all sizes – the startups, those in the scale-up stages, to the large global corporations – are drawn to the talent and opportunity that York Region’s tech sector provides.

Unfortunately, the coronavirus (COVID-19) pandemic has generated its fair share of challenges for businesses of all sectors in the region.

The federal and provincial governments have responded quickly by making announcements for programs providing immediate temporary relief, but what about thinking long-term? While multiple payment extensions may offer a sigh of relief, this is also a crucial time for businesses to be proactive and find a way to maintain cash flow towards critical operating and strategic growth projects.

This is where Canadian government funding programs can provide so much value. York Region Economic Strategy has partnered with Mentor Works to outline additional longer-term government funding programs for Information & Communications Technology (ICT) businesses.

There’s No Time Like The Present

It can be difficult to visualize the impact of developing and executing a multi-program government funding plan, especially when used over several years and multiple projects, but the results are profound. Without a doubt, the time and resources required to access government funding programs are worth it.

Typically, ICT business’s strategic growth projects can align into three categories: research and development, hiring and training, and business/market expansion.

We’ve highlighted some of the top government funding programs in these three investment areas that Information & Communications Technology businesses in York Region should be aware of. First focus on what key R&D activities are core to the competitiveness and growth path of your organization.

Research and Development Programs

NGen Capacity Building Projects

Next Generation Manufacturing Canada (NGen), one of Canada’s five innovation superclusters, administers $192M in federal funding for collaborative technology development and application projects among member organizations (membership is free).
Deleted: The Capacity Building Project stream supports Canadian SMEs by de-risking their implementation of advanced manufacturing technologies that will improve competitiveness and grow customer sales. This stream funds three specific types of projects:

Feasibility Studies: Funds partnering organizations (including at least one SME) undertaking advanced manufacturing, business planning, and technology implementation strategies such as risk assessments, market studies, and/or economic analyses. Project costs should be $50,000-$200,000 of which NGen may reimburse up to 50%.
Cluster Development: Supports new or existing clusters (minimum five SMEs) that are taking on a transformative initiative in advanced manufacturing such as commercialization, IP development, and/or training. Maximum project value is $150,000 of which NGen may reimburse up to 50%.
Pilot Projects: Funds partnerships of at least two SMEs undertaking activities to prove out technology implementation projects such as manufacturing process development, risk mitigation planning, and business case development. Project costs should be $100,000-$500,000 of which NGen may reimburse up to 50%.

While some NGen programs accept applications on an ongoing basis, others have designated intake periods.

National Research Council Industrial Research Assistance Program (NRC IRAP)

Designed to help accelerate the research and development projects of Canadian innovators, IRAP can be leveraged to subsidize a portion of payroll costs. Companies can apply for NRC IRAP funding through nrc.canada.ca or by calling the toll-free number at 1-877-994-4727.

Amount: Coverage ranging from 50-75% of payroll costs for projects.
Applicant Eligibility: Canadian-owned, incorporated private sector companies with <500 employees and in-house R&D capabilities (i.e. technical staff). Potential applicants must first present their project idea to an Industrial Technology Advisor (ITA).
Project Examples: Developing a new version of a product or service that has an innovative feature such as reducing energy usage, increasing productivity, etc.

The National Research Council Industrial Research Assistance Program (NRC IRAP) has created a COVID-19 funding stream to grant R&D funding to manufacturers that can provide innovative solutions for Public Health Agency of Canada and Health Canada medium-term needs: personal protective equipment (PPE), sanitization, diagnostic and testing, therapeutics, and disease tracking technology.

Amount: At the time of writing, no maximum funding cap has been announced for the NRC IRAP COVID-19 stream.
Applicant Eligibility: Any business that can help meet the medium-term needs of Public Health Agency of Canada and Health Canada listed above.
Project Examples: Clothing manufacturers pivoting to create medical-grade masks, gowns, and other medical equipment.

York Region businesses can apply for this funding through the NRC IRAP COVID-19 online registration form.

AV Research and Development (R&D) Partnership Fund

A pillar of the Autonomous Vehicle Innovation Network (AVIN), the AV Research and Development (R&D) Partnership Fund offers AV technology innovators (SMEs) Ontario government grants to develop, prototype, and validate pre-commercial autonomous vehicle technology. There are two streams of available funding: Stream 1 – Collaborative R&D Projects and Stream 2 – Technology Demonstration Projects.

Amount: Up to one-third of eligible project costs to a maximum of $100,000 for Collaborative R&D Projects and up to one-third of eligible project costs to a maximum of $1,000,000 for Technology Demonstration Projects.
Applicant Eligibility: Ontario-based SME technology developers with fewer than 500 full-time employees. Applicants must partner with at least one other organization, which may include another SME, national and multi-national enterprises, academia, municipalities, non-profits, or Indigenous Communities.
Project Examples: Development and demonstration of pre-market technologies (TRL 3-7) in the Connected and Autonomous Vehicle (C/AV) sector. Some priority areas include mass light vehicles, heavy-duty vehicles, transportation infrastructure, and intelligent transportation systems.

More eligibility criteria can be found on the AV Research & Development Fund program website.

Interactive Digital Media Fund (IDMF)

Administered by Ontario Creates, the Interactive Digital Media (IDM) Fund is an Ontario government grant that offsets a portion of costs directly related to concept definition and production projects. The Concept Definition (early-stage activities) and Production (market-ready projects) streams provide IDM content creators with funding for high quality, original interactive digital media content projects that make a positive contribution to the Ontario economy.

Amount: Up to 50% grant to a maximum of $50,000 for Concept Definition projects, or $250,000 for Production projects to release interactive digital media content to end- users.
Applicant Eligibility: Incorporated, Ontario-based digital media companies (can be Canadian-owned), with at least one owner/employee with minimum of three years of related industry experience.
Project Examples: Interactive digital media content creation/development that is unique, creative, professional, and is intended to educate, inform, entertain, and generate revenue.

SCALE.AI

The Supply Chains and Logistics Excellence AI (SCALE.AI) supercluster enhances Canada’s existing supply chain practices by boosting economic development through faster adoption and integration of artificial intelligence (AI). It seeks to connect researchers and industries to establish Canada as a global AI development hub.

Amount: Up to 40% of eligible costs for projects that can accelerate the adoption and commercialization of AI for supply chains. Minimum 2:1 cash match from applicant and/or partners. The match must come from private sector contributions.
Applicant Eligibility: All national and international companies, but projects must occur in Canada and have at least one SME partner. SCALE.AI encourages projects that demonstrate collaboration across large and small enterprises, research institutions, and academia.
Project Examples: Projects should contribute to strategic objectives such as AI adoption and commercialization of AI-based products. They must also benefit Canada’s supply chain eco-system and help Canadian supply chain companies compete globally.

Applications for funding are currently being accepted.

ENCQOR 5G Technology Development Program

The ENCQOR 5G SME Technology Development Program supports collaborative 5G technology development projects with government funding to further develop, integrate, test, or validate pre-commercial 5G technologies.

Amount: Awarded funding is based on the current Challenge Statements but typically ranges from $50,000 to $500,000.
Applicant Eligibility: For-profit Ontario SMEs with fewer than 500 employees. Applicants must partner with an ENCQOR 5G Anchor Firm(Ciena, Ericsson, Thales). Additional eligibility criteria may be enforced based on some Challenge Statements.
Project Examples: Be developed in response to a posted Challenge Statement, have a technology readiness level (TRL) of 1-7, and use the ENCQOR 5G Innovation Platform as a Service (iPaaS) testbed.

Hiring and Training Programs

One of the advantages of developing a government funding strategy is the ability to combine multiple programs to support one large goal. For example, your business has just embarked on an autonomous vehicle project; does your team need extra training to be successful? Or maybe you simply need extra hands. Layering on hiring and training grants can be critical to meet your current and future needs.

Canada-Ontario Job Grant (COJG)

The Canada-Ontario Job Grant (COJG) is an Ontario government funding program that offers training grants to employers. Through the program, companies may receive non-repayable funding from the government to purchase third-party business training programs, including training for in-demand skillsets.

Amount: Grant up to 50% (>100 employees) or 83% (<100 employees) to offset up to $10,000 per trainee. Small businesses with new hires may receive up to 100% coverage to a maximum of $15,000 per trainee.
Applicant Eligibility: For-profit and not-for-profit sector employers, First Nations, and organizations acting on behalf of employers may apply. They must be licensed to operate in Ontario and be applying for training that is delivered in Ontario and is related to a job that is in Ontario.
Project Examples: Training topics are to relate to the trainee’s career or skill development. Eligible training programs include financial planning, leadership, project management, marketing, software and technology, and more.

Post-Secondary Co-op Hiring Grants – Open for Summer 2020

Available via Magnet, there are hiring grants available to provide a portion of a current post-secondary student’s wage while they complete a paid, full- or part-time co-op placement. The roles can be in any industry but must support the student over a full semester (minimum 16 weeks). Funding is awarded on a first-come, first-served basis.

Amount: Up to 50% to $5,000 or up to 70% to $7,000 if the student is a woman in STEM, has been in Canada for less than 5 years, identifies with a disability, or is a first-year student.
Employer Eligibility: Canadian businesses can be in any industry and only net new positions qualify. Those looking to fill placements from May-August 2020 may now apply. *The program will allow for retroactive placements started in January 2020 if applications are submitted before April 30, 2020.
Candidate Focus: Must currently be enrolled in a post-secondary program that includes a work-integrated learning component (mandatory co-op/work placement). The student can be in any program of study. They are to be a Canadian citizen, permanent resident, or have refugee status. Must not be hired based on nepotism.

If your company is looking to fill post-secondary co-op roles this summer, consider using hiring grants to cover a portion of wages.

Hiring a Full-Time Post-Secondary STEM Graduate

Administered by BioTalent Canada, funding is available to assist innovative businesses to connect with recent graduates from STEM-related (Science, Technology, Engineering, Mathematics) programs.

Amount: The program provides up to a maximum of $15,000 in wage subsidies.
Employer Eligibility: Canadian organizations (for-profit SMEs, not-for-profits, post-secondary institutions, municipal governments, etc.) providing a full-time STEM- related internship for six to 12 months.
Candidate Focus: They are to be a Canadian citizen, permanent resident, or have refugee status, be under the age of 30 before the start of the internship, and have graduated in the last three years from a post-secondary STEM program.

Hiring a Full-Time Post-Secondary R&D Graduate

Career Launcher offers funding available to cover Ontario college and university students, as well as recent graduates, to work on industry-driven R&D projects in all sectors.

Amount: Up to $10,000 per four-month unit to a maximum of $60,000 (six units).
Employer Eligibility: Ontario-based businesses with research-oriented projects where results can be commercialized to benefit both the applicant and the Ontario government. The current focus is on automotive manufacturing companies or product/service providers for the automotive industry.
Candidate Focus: Final-year undergraduate student; master’s or Ph.D. student; or within three years of graduation from an undergraduate or master’s program from an Ontario college, university, or research hospital.

International Expansion Programs

With the right equipment, data management systems, and human resources in place, your business can begin to focus on adopting new international customers. While international travel has halted, for the time being, there are still programs that can be used to tap into the markets recovering from COVID-19.

CanExport SMEs Program

The CanExport SMEs program provides financial support to eligible Canadian exporters for marketing and expansion activities in up to five target export markets. Eligible expenses include marketing activities, packaging modifications, market research, and other initiatives.

Amount: Up to 75% of eligible costs associated with export marketing projects to a maximum $75,000 grant per application.

Applicant Eligibility: 1-500 FTEs on payroll, $100,000-$100M in annual revenue, 1+ years incorporated with taxes filed, and project expenses must be at least $20,000. The applicant’s sales must be under $100,000 (or less than 10% of total sales) in the target export market(s) over the previous 24 months.

Project Examples: Promotional video creation, designed for a foreign market.

At the time of this writing, the CanExport program is seeing major changes as a direct result of COVID-19. Visit tradecommissioner.gc.ca for the latest CanExport program updates related to COVID-19.