Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act
Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act: Help for Shuttered Venues Operators
Signed into law on December 27, 2020, the Consolidated Appropriations Act, 2021, included the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, which was designed to help entities hardest hit by the COVID-19 pandemic. While the largest piece of the funding in the Act was $284 billion for the well-known Paycheck Protection Program (PPP) Second Draw Loans, it also contained $15 billion in grants made available under the Shuttered Venue Operators (SVO) grant program that will be administered by the U.S. Small Business Administration (SBA) Office of Disaster Assistance.
Entities eligible to receive relief under this program include the following:
- Live venue operators or promoters
- Theatrical producers
- Live performing arts organization operators
- Relevant museum operators, zoos and aquariums who meet specific criteria
- Motion picture theater operators
- Talent representatives
- In operation as of February 29, 2020
- Experienced a 25% or greater revenue loss between one quarter of 2019 and the corresponding quarter of 2020
- Not have been awarded a PPP loan on or after December 27, 2020
- Have a defined performance and audience spaces with fixed seating - defined as seating permanently fixed to the floor or ground (mobile entities such as a circus, fair, or business that provides talent for events such as weddings are not eligible)
- No more than 10% of its 2019 gross revenue came from the federal government (not counting disaster assistance)
- Must not operate in more than 1 country or more than 10 states AND have more than 500 employees as of Feb. 29, 2020
An entity may not apply for a PPP loan and an SVO Grant at the same time. It is recommended to consider both funding sources, before applying, to determine which could result in greater funding. If a loan application is denied by one program, the entity would then be eligible to apply under for the other.
Grants will be awarded at the 45% of their 2019 gross earned revenue with a maximum award of $10 million. For new entities that began operations after January 1, 2019, the award is calculated at the average monthly gross revenue for each full month in operations during 2019 multiplied by six with a maximum award of $10 million.
These grants will be awarded in three priority stages:
- The first 14 days of grant awards will be to those entities experiencing a 90% or greater revenues loss between April 1, 2020 and December 31, 2020.
- The next 14 days will be to those experiencing a 70% or greater loss for that same time period. After the first and second priority awards are made there will be third priority awards to those entities with a 25% or greaterrevenue loss between one quarter of 2019 and the corresponding quarter of 2020.
- Additionally, supplemental funding may be available to those who received first or second priority round awards who suffered a 70% or greater revenue loss for the most recent calendar quarter, as of April 1, 2021 or later.
What can be done now to prepare?
- Obtain a Dun & Bradstreet (DUNS) number and register in the System for Award Management (SAM.gov). An Individual Taxpayer Identification Number or Employer Identification Number cannot be used.
- Gather documentation to support your employee count and monthly revenue so that you can calculate the average number of qualifying employees the entity has had over the prior 12 months.
- Determine and document the extent of gross earned revenue loss experienced in 2020 compared to 2019.
As of this writing, the SBA is still working on the application format but has provided the following:
Click here to visit the SBA website regarding information on these funds.
Click here to visit the FAQ document regarding information on these funds.
For additional information contact us at email@example.com.
Article compiled by Nick L. Bieber.