If you’ve been reading our blog for awhile, or follow music industry folks online, you’ve probably heard of the Save Our Stages Act. We first covered the SOS Act in August, after its introduction to Congress. In November, we shared an update on the act’s progress. Now, over 9 months after most venues had to shutter due to COVID-19, the venues that we know and love have secured government support through the passage of the Consolidated Appropriations Act, 2021.
On December 21, 2020, Congress passed the Consolidated Appropriations Act, 2021 – a COVID relief and omnibus spending bill. The President signed the bill on December 27. Part of this bill is the Save Our Stages Act, now formally known as Section 324 of Division N of the Consolidated Appropriations Act, 2021.
What’s in the Bill?
In short, Section 324 allows the Small Business Association to provide grants to live entertainment entities for up to 45% of their gross revenue from 2019 (with a max grant of $10 million). Grant money can be used for rent, utilities, payroll, and personal protective equipment.
View the entirety of the Consolidated Appropriations Act, 2021 on Congress.gov. See only Section 324 of Division N in this Google Doc (with important bits highlighted).
For a quick refresher on the originally introduced Save Our Stages Act, visit our article from August. The two pieces of legislation are highly similar, though not exactly the same.
The eligibility guidelines are largely the same under the new law as under the previously introduced SOS Act. Organizations can’t be too big, or too small. They can’t operate abroad or in more than 10 states, nor can they have more than 500 employees. However, they must market the performances and sell tickets (or have cover charges), fairly pay artists, have pro sound equipment, and have one or more employees that perform at least two of these roles: security, booker, promoter, sound engineer, stage manager, or box office manager.
Grants and grant dispersal
Both the original SOS Act and the passed version in the omnibus bill provide for both initial grants and possible supplemental grants.
Initial grants are divided into three priority rounds. Those that lost more than 90% of their revenue receive grants first, After two weeks, those that lost more than 70% of their revenue can receive grants. At the end of both of these two week periods, all eligible entities can receive grants. Additional requirements are that the Administration cannot use more than 80% of the funds for the first two rounds, and that at least $2 billion goes to entities with less than 50 employees. As mentioned above, the grants will equal up to 45% of 2019 revenue, with the max amount being $10 million.
Once the Administrator has processed and decided on all initial requests, they can process requests for supplemental grants. Those whose revenue is still below 30% of 2019 levels. Supplemental grants will be 50% of the initial grant value.
The only two major differences between the Sec. 324 version (law) and the originally proposed SOS Act as related to the grants are the maximum grant amount (now $10 million instead of $12 million), and timing for initial/supplemental applications.
Using the Grants
Grant recipients can use the grant money for expenses incurred between March 1, 2020 and the end of this year. Those who receive supplemental grants can use the money for expenses until June 30, 2022. After this time period, unused funds shall be returned to the Administrator.
The Act has set out a very definitive, yet inclusive, list of what is an allowable expense. Allowable expenses include: payroll, rent, utilities, mortgage and loan payments, contractor (1099) worker payments, and “other ordinary and necessary business expenses” such as fees, taxes, maintenance, insurance, etc.
Explicitly prohibited expenses include new real estate, new loans, political contributions, and investment/relending.
Who helped pass the bill?
Passing the Save Our Stages Act was no small feat! In the past decade, only about 3% of bills become laws. And getting the bill introduced to Congress is no small feat either!
The Save Our Stages initiative was created by the National Independent Venue Association (NIVA), an organization that didn’t even exist until April 2020. Over 3000 venues have since joined the organization.
The SOS Act itself made its official introduction into Congress in late July. Senators Cornyn and Klobuchar crafted the legislation and Representatives Welch and Williams sponsored the companion bill in the House. The SOS Act slowly but surely gathered bipartisan cosponsors in both the House and the Senate.
To aid in the bill’s success in Congress, NIVA worked with law firm Akin Gump. In a statement from NIVA, Advocacy Committee co-chair Adam Hartker stated “Without Akin Gump’s belief in our cause and advice on how to get this done, we could never have gotten the Save Our Stages Act passed. They fought for us like they were us. The entire industry will forever owe them a debt of gratitude.”
In addition to NIVA’s efforts themselves, thousands of artists and hundreds of thousands of citizens supported the cause. Over 1200 artists signed a public letter to Congress calling for support of SOS, and music fans and industry folks alike sent over 2.1 million emails to Congresspeople via SaveOurStages.com.
NIVA’s Statement on the Passage of the Save Our Stages Act
“This is the lifeline our industry so desperately needs to emerge from a devastating year,” said Dayna Frank, Owner & CEO, First Avenue Productions and Board President of NIVA, in a recent official NIVA statement. “Without independent venues and promoters across the country
working to engage their communities, staff, and artists, our voices would not have been heard – we are thankful for those tireless efforts. Careers came to a standstill overnight, and people continue to face personal hardships, which is why legislation like this and extending Pandemic Unemployment Assistance is essential. Our immense gratitude goes, in
particular, to Senator Klobuchar, Senator Cornyn, and Senator Schumer, for securing the future of independent venues and promoters for generations to come.”
In their recent statement, NIVA also expressed gratitude to Akin Gump, artist and citizen supporters, and dozens of big-name corporations and organizations in the music industry who supported the cause in some form or another – from Spotify to Sony to Country Music Association, and many many more.
And though the recent passage of the SOS Act is a major cause for celebration for all concert lovers, NIVA stresses that we’re not out of the woods yet. It may still be awhile before venues get the funding that they need, and in the meantime venues still have expenses pilling up. Despite funds raised from #SOSFest and a recent $1 million donation from Jägermeister, the NIVA Emergency Relief Fund still needs $2 million more in donations to fulfill the immediate and urgent funding requests from venues. Those who would like to donate can do so via NIVA’s website.