New SBA Grants Available for the Battered Entertainment Industry and Venues

• Author: Chris Remington
• Posted: 2024-10-04

Everyone knows that the entertainment venues had been hit hard during 2020. AMC movie theatres were on the brink of bankruptcy due to closed theatres in multiple states.

They were losing billions of dollars. Broadway shows are shut down, and the Circle du Soleil company had to layoff thousands of acrobats and performers while declaring bankruptcy. Only a handful of presentations are available on the Las Vegas strip.

American companies can now apply for relief. The new CAA or Consolidated Appropriations Act of 2021 will provide new funding of $900 billion in COVID relief for the new year.

Struggling theaters can apply for $15 billion in aid with Title III, Section 324 of the CAA Act. The Small Business Administration will administer multiple programs.

In addition to the at-risk businesses and theatrical entities, individuals who work in theater production, museums, as promoters, stadium operators, performing arts organizer, or theatrical producers are also eligible for assistance. Recipients of aid can either be a government operative or a non-profit or for-profit business entity.
 

Live Venues

Owners and operatives of live venues must typically sell tickets 60 days before the show. Live acts must negotiate their contracts based on a percentage of sales or cover fees. Revenues of at least 70%, on average, must be derived from not only ticket sales but sales from food, beverages, and gift sales - merchandise and t-shirts. Venues can show:
 

• Live theater


• Comedic acts


• Theatrical productions


• Concerts


 

Museums preserve our cultural heritage. To obtain funding, museums must be organized for aesthetic, educational, and cultural heritage purposes.

Movie theaters should have at least one public space for showcasing movies for a fee.
 

Talent Agents

The talent representative is an agent or manager of viable acts for 70% of operations to receive aid. Agencies must frequently represent and book acts in live events, concrete venues, and festivals. Acts must receive compensation from ticket sales and ticket fees. All relative entities are accepted: non-profit, for-profit, and governmental agencies.
 

Eligibility Requirements

Your business entity can receive SOS grants, and you must have established operations since February 29, 2020. Furthermore, for at least one quarter of 2020, your business must have had a 25% reduction in revenues than in 2019. If your business is currently closed, you must have a reopening plan for 2021.

Movie theaters should promote first-run movies, talent agents must book performers, and museums should establish a footprint in antiquities.

Artist promoters should organize concerts while managing employees. Venues, on the other hand, must commit to hiring employees with specialty training as:
 

• Sound engineer


• Booker


• Stage manager


• Security guard


• Ticket sales manager


 

 

Ineligible Businesses

Large corporations that operate in multiple countries are not eligible for the SOS grants. Moreover, they cannot have more than 500 employees, must be in business by February 29, 2020, and cannot operate in more than ten states. The company cannot be owned by more than 10% through an outside interest. Live performances and venues of a prurient sexual nature are excluded.
 

SOS Grants

Grants are capped at $10,000,000. If your company has already received the first grant, the second grant will be capped at 50% of the first grant. SBA will give supplemental grants once the first round of funding is complete.

The SBA will disperse the grant funds in two priority periods. During the first 14 days of the priority period, companies that have lost 10% of revenues from April 1, 2020, to December 1, 2020, compared to 2019, will receive the first round of funding.

For the second priority period of the next 14 days, companies and organizations can have a reduction of 30% in revenues for funding. Once these two 14-day periods have passed, other grant recipients will have access to the funds' remainder.

For the accounting revenue method, the SBA uses the accrual method. Whatever prior PPP funding your company received for 2020 will be excluded from your next disbursement. Companies with less than 50 full-time employees will be given priority. Full-time employees must work at least 30 hours per week.
 

Applicable Services

You can use the new grants to pay for services from March 2021 to June 30, 2022. Pay for:
 

• Mortgage and rental payments


• Utilities


• Payroll


• Contractor salaries


• State and Local taxes


• Insurance payments


• Production expenses


 

Funds that are not spent in 18 months must be returned to the SBA. Review their website for the PPP application. To speak with a friendly representative, contact the SBA at 1-800-659-2955 or email an agent directly at disastercustomerservice@sba.gov.