Save Our Stages Act Has passed as part of the COVID-19 Relief Bill
Thank you for helping to #SaveOurStages! NIVA thanks those across the country who sent 2.1 million emails to their elected officials expressing their support for the Save Our Stages Act. All 535 Congresspeople heard from their constituents through SaveOurStages.com. We encourage you to tell your legislators you appreciate their support and for including independent venues and promoters in the latest COVID-19 Relief Bill!
Without your support and continued attention, we could not have accomplished this goal together!
We know you have many questions about the Save Our Stages Act and how it will be administered. NIVA has assembled the Implementation Task Force and is working with the Small Business Administration as they promulgate regulations – we are working hard to make sure that NIVA members receive the help they need via this program. We seek to ensure the emergency relief is dispersed as Congress intended, that the instructions and process to apply for grants ensure that the process is implemented accurately, fairly and as expediently as possible.
Since it could take many weeks, even months for the funding to flow, the NIVA Emergency Relief Fund, with The Giving Back Fund as its 501(c)3 fiscal sponsor, continues to raise money to assist the venues at greatest risk of permanently going under as we wait for the grants to be issued. Anyone wishing to donate can do so below.
What is NIVA (National Independent Venue Association)?
- We are a group of over 3,000 independent venues in 50 states and Washington D.C. that are banding together to ask Washington for targeted legislation to help us survive.
- We were the first to close. We will be the last to open.
- We are 100% shut down for an indefinite period of time.
- We have zero revenue.
- We are small businesses who are in danger.
What are we asking our Senators and Representatives for?
1. PROVIDE LONG-TERM ASSISTANCE FOR SHUTTERED BUSINESS
NIVA supports the Save Our Stages Act (S. 4258)led by Senators John Cornyn (R-TX) and Amy Klobuchar (D-MN) and (H.R. 7806) led by Representatives Peter Welch (D-VT) and Roger Williams (R-TX) which would provide a critical lifeline for independent venues. The bill has significant bipartisan support with more than 196 co-sponsors and was included in the Heroes Act passed by the House on October 1, 2020. Key provisions of the Act include:
- Establishes a $10 billion grant program for live venue operators, promoters, producers and talent representatives.
- Eligible recipients must have fewer than 500 FTEs, not be publicly traded companies, and not own or operate venues in more than 1 country or more than 10 states.
- Each recipient is eligible for a grant no greater than 45% of gross revenue from 2019 or $12 million, whichever is less.
- Grant funding may be used for expenses incurred between March 1, 2020 and ending on December 31, 2021.
- A recipient is eligible for a supplemental grant equal to 50% of the initial grant if the entity is still experiencing 80% or greater revenue loss on December 1, 2020.
- Grant funding may be used for payroll and benefits, rent, utilities, mortgage interest payments, interest payments, insurance, PPE, existing loans, payments to 1099 employees, and other ordinary and necessary business expenses.
2. RELIEF THROUGH TAX CREDITS
- Rent/Mortgage Tax Credit. NIVA supports proposals like the Keeping the Lights on Act (H.R. 6799), which was included in the House-passed HEROES Act, that permit severely distressed small businesses to earn a tax credit for rent, mortgage, and utility expenses.
- Employee Retention Tax Credit. NIVA supports expanding eligibility for the ERTC in the CARES Act to include shuttered businesses that are recipients of PPP loans, and continuing this benefit until the industry is able to resume normal operations at full legal capacity.
- Safe Workplace Incentives. NIVA supports proposals like the Clean Start Act (H.R. 7079), which provides a tax credit to businesses for added costs related to cleaning & disinfecting products, PPE, and other tools needed to ensure both workers and customers remain safe.
- Excise Tax Relief on Beverage Alcohol. NIVA supports making the federal excise tax rates on beverage alcohol permanent, as proposed in the Craft Beverage Modernization & Tax Reform Act (H.R. 1175/S. 362), and opposes increases in state excise taxes on beverage alcohol.
3. Support For Live Event Workers And Artists
NIVA supports continuing additional unemployment insurance for employees of shuttered businesses, as well as the Mixed Earner Pandemic Unemployment Assistance Act (H.R. 7691/S. 4442) which ensures that workers who earn a mix of traditional (W-2) and independent (e.g. 1099) employment income are able to fully access the unemployment assistance provided in the CARES Act.
NIVA also supports the Help Independent Tracks Succeed (HITS) Act (H.R 7886), which helps independent music creators by allowing an individual to fully expense for tax purposes the cost of new studio recordings.
PPP DOES NOT WORK FOR SHUTTERED VENUES
As arguably the hardest hit industry by the pandemic, with no revenue, high overhead and no timeline for reopening, the Payroll Protection Program (PPP) and the proposed updates to the program found in the House-passed HEROES Act, Senate Democrats’ P4 and Senate Republicans’ HEALS Act are not viable solutions for this industry. Here’s why:
- PPP penalizes companies with many part-time employees: Per the SBA 7(a) program, eligibility is based on every single employee. Therefore, original PPP funding was available to those with fewer than 500 employees using a full headcount. This disadvantages many NIVA members and other small businesses like ours who depend on part-time employees. For example, Merriweather Post Pavilion, just outside of DC, provides seasonal, part-time work to more than 1,000 part time employees like schoolteachers and students. These are small businesses that are ineligible due to the fact that they rely on part-time workers. Using a Full Time Equivalent (FTE) count is more practical. NIVA members across-the-board have fewer than 150 FTEs.
- Flexibility to use funds to keep the lights on is necessary: Due to high overhead (large spaces often in high-rent districts), lower payroll costs as a percentage of expenses, and having no work to offer employees for the foreseeable future, the 60/40 requirement necessary to obtain forgiveness under PPP does not work for this specific industry. We need help to cover fixed overhead to pay rent, mortgages, utilities, taxes and insurance until we can all fully reopen safely.
- Payroll is not our only, nor our biggest expense: For PPP and the extension of the program in the HEROES Act, PPP Second Draw in the HEALS Act, and P4 the loan amount is 2.5 times average payroll costs. We are in high-rent districts in large buildings with enormous overhead, so the ratio of 2.5 times payroll costs is not enough to cover our fixed costs or sustain our businesses with no revenue well into 2021. Basing the loan amount on multiple expenses/gross revenue/operating costs, and not just payroll is crucial.
- Long-term support is needed with reopening not expected until a vaccine: The Heroes Act includes no long-term program to provide assistance for shuttered industries. P4 and the HEALS Act extend through the end of the year. Large gatherings will likely not happen until there is a vaccine, and we will not be able to fully recover until large gatherings are permitted again at full capacity – which may be until well into 2021. By all predictions, our industry will come back stronger than ever – we just need federal assistance to help us stay afloat until we can reopen our doors.
- Forgiveness is crucial for shuttered industries with negative cash flow: Forgiveness restrictions in PPP, P4 and HEALS Act make forgiveness unattainable for many NIVA members (more detail below). The Recovery Sector Business Loan Program in the HEALS Act provides no forgiveness at all. Due to the nature of our business – large public gatherings – our industry is experiencing essentially 100%+ revenue loss for an indefinite period of time. We cannot take on more debt with negative cash flow. For many small business owners, this could mean potentially losing their homes in a quest to ensure their livelihood.
- Opportunity Zone Requirement penalizes industries that foster economic growth: The HEALS Act Recovery Sector Loan Program is only available to those in an opportunity zone. Not all of our venues fall into opportunity zones, but we are all experiencing essentially 100% revenue loss with no idea of when we will be able to reopen. Our members have historically helped developing neighborhoods all over the country. For example, when the 9:30 Club opened in DC, it was in an economically distressed area, but it led the charge in fostering local economic growth, paving the way for other businesses like bars, restaurants, and retail shops that knew events would generate income for their businesses.
Check out our full letter to Congressional Leadership here:
Help us #SaveOurStages