New COVID relief grants program for shuttered venues includes museums

ASTC is reading through the text of the almost 5,600-page omnibus spending and COVID relief bill for provisions relevant to the ASTC community. This is the second in a series of blog posts about the legislation in which we highlight the new Grants for Shuttered Venue Operations program. The first post noted changes to the Paycheck Protection Program including the opportunity for a second draw. Stay tuned for additional posts.

The massive COVID relief and omnibus spending bill passed by the U.S. House and Senate yesterday includes a new grant program for “shuttered venue operators” that includes museums along with other live venues.

Note that entities receiving these grants are excluded from Paycheck Protection Program (PPP) loans. We believe that this only applies to loans made after the bill is enacted and is not retroactive to previous PPP loans already received.

Grants for Shuttered Venue Operators

Section 324 of the bill establishes a new grant program for eligible live venue operators including nonprofit museums, with similar covered expenses as the Paycheck Protection Program (see related blog post).

This new grant program would provide a total of $15 billion in support for “a live venue operator or promoter, theatrical producer, or live performing arts organization operator, a relevant museum operator, a motion picture theatre operator or a talent representative” who was fully operational on February 29, 2020 and who intends to reopen—and who can demonstrate a reduction in revenues of at least 25 percent as compared with the previous year, calculated on a quarterly basis.

The legislation defines museums as needing to have the following characteristics in addition to the being included in Section 273 of the Museum and Library Services Act (20 U.S.C. 9172), which explicitly includes science and technology centers:

  1. Serving as a relevant museum as its principal business activity.
  2. Indoor exhibition spaces that are a component of the principal business activity and which have been subjected to pandemic-related occupancy restrictions.
  3. At least 1 auditorium, theater, or performance or lecture hall with fixed audience seating and regular programming.

ASTC is working with our fellow museums associations to ensure that these provisions are interpreted as inclusively as possible when the Small Business Administration writes the detailed rules for the program. We are aware, for example, that many institutions may not have spaces with fixed seating.

Entities must not have received more than 10 percent of gross revenue from Federal funding during 2019. Unlike the Paycheck Protection Program, there is some eligibility for museums—and other venues—that are associated with state or other governments.

There are also restrictions that limit eligibility for larger or multi-site entities, including for those who own or operate venues in more than one country, in more than 10 states, or who employ more than 500 employees as of February 29, 2020. We will await more specific guidance from the Small Business Administration, but larger museums may be eligible for these grants, unlike PPP loans.

Originally a part of the stand-alone Save Our Stages Act (SOS Act) introduced by Sen. John Cornyn (R-TX) and Sen. Amy Klobuchar (D-MN) in July, this legislation was expanded from the original focus on concert and theatrical venues to also include other entities including museums, zoos, and movie theatres.

The legislation sets out a tiered priority system for the initial round of grants:

  • During the first 14 days of grants, the program is only available to entities that have experienced at least a 90 percent reduction in revenue between April 1 and December 30, 2020, as compared to the same period of 2019 due to the COVID-19 pandemic.
  • During the next 14 days of grants, the program will award grants to those entities that have experienced at least a 70 percent reduction in revenue.
  • After 28 days, the program will be available to all eligible entities, as described above. At least 20 percent of the total appropriated funds ($3 billion) will be held back to ensure that not all funds are expended for the hardest-hit entities.

The program would also set aside $2 billion for venues that employ no more than 50 staff members during the first 60 days of implementation.

The Small Business Administration (SBA) may provide supplemental grants up to 50 percent of the initial grant, as long as the total is less than $10 million per entity.

Congress requires the SBA to develop an oversight and audit plan, so we can expect increased scrutiny of grants under this program.

ASTC will continue to monitor the legislation as we learn the full extent of the provisions regarding PPP and other relief and recovery programs. For additional information, the following resources may be helpful:

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