Concert halls seek $ 16 billion in federal pandemic aid

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When the pandemic forced Crowbar, a music club in Tampa, Florida, to close last year, Tom DeGeorge, its primary owner, took out more than $ 200,000 in personal loans to keep the business afloat, including one using his liquor license as collateral. .

More than a year later, the club reopened with a handful of reduced capacity events, but the business is still operating in the red, DeGeorge said in an interview. So, on Thursday, Crowbar was among thousands of concert halls, independent theaters and other arts and entertainment institutions trying to ask for a share of $ 16 billion in federal aid.

“We wasted an entire year of concerts in the blink of an eye, which was almost a million dollars in revenue,” said DeGeorge. “That’s why we need this grant so badly.”

Help comes from the Shuttered Venue Operators Grant, which was cleared by Congress late last year after months of lobbying from an ad hoc coalition of music halls and other groups who warned against the loss of an entire sector of the artistic economy.

For concert halls in particular, the past year has been a rush to stay afloat, with local club owners running crowdfunding campaigns, selling t-shirts and racking their brains for a creative way to fundraise. funds. For the holidays, the Subterranean Club of Chicago, for example, agreed to place the names of customers on its marquee for donations of $ 250 or more.

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“It has been the busiest year,” said Robert Gomez of Subterranean in an interview. “But it all revolves around the question, ‘Where am I going to get funding from? “”

Because the grants will be made on a “first in, first out” basis, those looking for the money are in a race for the money: once the $ 16 billion is used up, those who remain in the queue. waiting will be refused empty-handed. But when the Small Business Administration, which runs the program, opened their system at noon Thursday, a glitch delayed the application process for hours.

As has happened with other relief programs run by the agency – notably the Paycheck Protection Program, a $ 746 billion aid effort – the opening of the closed sites program has been seeded with pitfalls and confusion.

The agency released a 58-page guide for applicants late Wednesday night, then quickly took it offline. A revised version of the guide was released a few minutes before the portal opened on Thursday. (A spokeswoman for the agency said the guide needs to be updated to reflect “some last minute system changes”.)

And less than two hours before the agency began accepting applications, its inspector general issued an alert if there were “serious concerns” about the program’s waste and fraud controls. The Small Business Administration’s current audit plan “exposes billions of dollars to possible misuse of funds,” the Inspector General wrote in a report.

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Successful applicants will receive a grant equal to 45% of their gross earned income from 2019, up to $ 10 million. Those who lost 90% of their income (from the previous year) after the onset of the coronavirus pandemic will have a 14-day priority window to receive the money, followed by another 14-day period to those who lost 70% or more. If any funds remain after that, they will go to applicants who experienced a 25% loss in sales in at least one quarter of 2020. Sites owned by large companies, like Live Nation or AEG, are not eligible.

The application process is extensive, with detailed questions about budgets, staff and site equipment.

“They want to make sure you don’t just put a piano in the corner of an Italian restaurant and call yourself a concert hall,” said Blayne Tucker, attorney for several music venues in Texas.

Even with the grants, concert halls can face many dry months before touring and live events return to pre-pandemic levels. Despite the encouraging progress on vaccinations, the various plans to reopen state and local governments, and plans to prepare for touring artists, will likely mean that the schedule of events will remain light during the summer or fall, the promoters said. and talent agents.

The grant program also offers support to Broadway theaters, performing arts centers, and even zoos, which share many of the same economic struggles.

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The Pablo Center at the Confluence, in Eau Claire, Wisconsin, for example, was able to raise around $ 1 million from donations and grants during the pandemic, but it is still $ 1.2 million short of its spending on annual fixed operations, said Jason Jon Anderson, its executive director.

“By the time we open again, October 2021 at the earliest, we will have been closed longer than we had been,” he added. (The center opened in 2018, at a cost of $ 60 million.)

The thousands of small clubs that dot the national concert map lack access to major donors and, in many cases, have survived on the fumes for months.

Stephen Chilton, owner of the 300-seat Rebel Lounge in Phoenix, said he took out “a few hundred thousand” loans to keep the club afloat. In October, it reopened with a pop-up cafe inside, and the club hosts some events, like trivia contests and open mic shows.

“We are losing a lot less than what we were losing when we were completely closed,” Mr. Chilton said, “but that doesn’t make up for the revenue lost in hosting events.”

The Rebel Lounge is hoping a grant will help it survive until it can bring back a full array of concerts. What if its application is not accepted?

“There is no plan B,” said Mr. Chilton.

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