Expert Advice: New Grants for Artists, Venues

SBA Updates Guidance, Sets Application Date for Grants Aiding Shuttered Venues, Talent Representatives

The Small Business Administration (SBA) has announced that it expects to open the application process for the Shuttered Venue Operators Grant (SVOG) program on April 8, making it critical for qualified entities to review federal guidelines and gather the necessary information now if they plan to apply.

There have been some important changes and updates, both under the recently passed American Rescue Plan Act and in the SBA’s published guidance, since we last covered eligibility and other key issues related to the SVOG program in January.


Applicants will be pleased to learn that they may now be able to apply for both new Paycheck Protection Program loans and SVOG grants. Previously, applicants had to choose between the two programs. Even applying for a PPP loan after December 27, 2020 would have made an applicant ineligible for an SVOG grant under the prior rules. In a March 12, 2021 update to the SVOG FAQS, (updated again on March 22) the SBA confirmed that applicants could receive both a new PPP loan and SVOG grant, subject to certain caveats below.

The first caveat is that the amount of an SVOG grant will be reduced by the amount of any PPP loan received by the applicant after December 27, 2020. This means applicants that apply for both programs will not receive more money. However, the ability to apply for both programs may be helpful for applicants who think they meet SVOG eligibility requirements, but are uncertain. The second caveat is that applicants that are approved for SVOG grants lose eligibility for PPP loans. Applicants hoping to apply for both programs will need to take this into account when deciding whether to accept any PPP loan proceeds. With the recent passage of the PPP Extension Act of 2021, the deadline to apply for PPP loans is expected to be extended by two months to May 31. As noted in the prior alert, funds granted under the SVOG program may be used for broader purposes than funds issued under the PPP loan program, so applicants planning to apply for both should carefully review the permitted uses under each program.

Eligibility Guidelines

In another bit of good news, the American Rescue Plan Act allocated an additional $1.25 billion for the grants, bringing the total amount available to $16.25 billion. The list of eligible entities remains the same, although the SBA has continued to update its FAQs to provide some guidance for those who aren’t sure whether they fall within one of the categories below.

Eligible entities include:

  • Live venue operators or promoters
  • Theatrical producers
  • Live performing arts organization operators
  • Relevant museum operators, zoos and aquariums that meet specific criteria
  • Motion picture theater operators
  • Talent representatives.

Each eligible business entity owned by an eligible entity may apply separately as long as each applicant was in operation as of February 29, 2020.

Grant amounts and processing timeframes remain the same, but are worth repeating. The grant amounts available to each applicant are as follows:

For an eligible entity in operation on January 1, 2019, grants will be for an amount equal to 45% of its 2019 gross earned revenue OR $10 million, whichever is less.

For an eligible entity that began operation after January 1, 2019, grants will be for the average monthly gross earned revenue for each full month it was in operation during 2019 multiplied by six (6) OR $10 million, whichever is less.

The processing timeframe after the application window opens is as follows:

  • First Priority: For the first 14 days, awards will be available to those that suffered a 90% or greater revenue loss from April 2020 through December 2020 due to the COVID-19 pandemic.
  • Second Priority: For the next 14 days, awards will be available to those that suffered a 70% or greater revenue loss from April 2020 through December 2020 due to the COVID-19 pandemic.
  • Third Priority: Beginning 28 days after First and Second Priority Awards are made, awards will be available to those that suffered a 25% or greater earned revenue loss between one quarter of 2019 and the corresponding quarter of 2020.
  • Supplemental Funding: Available after all Priority Periods have passed to recipients of First, Second, and Third Priority round awards that have suffered a 70% or greater revenue loss for the most recent calendar quarter (as of April 1, 2021 or later)

Top three tips to maximize your chances of getting an SVOG:

  1. Prepare ahead of time: As the application process opens on April 8, it is imperative that applicants review the eligibility requirements. Use the SBA’s Preliminary Application Checklist to gather all your necessary background and financial documents. For talent reps, you will need to have a copy of your management or consulting agreements and a list of venues where your acts were contracted to perform in 2019.
  2. Register with the necessary government sites: All potential SVOG applicants will need to register their entity with the federal government’s System for Awards Management (SAM) that allows you to submit your application for a SVOG. The SBA is holding an informational webinar on March 30 on the application process for which you can register here. It will be recorded, but you can always view video tutorials covering frequently asked questions here.
  3. Technical requirements. Last, make sure that you familiarize yourself with the technical requirements for the SBA and related sites. Nothing is more frustrating than being unable to access a website or missing a step in the registration process. The SBA has a network of partners that provide applicants with local help to prepare them for SVOG, PPP and other business recovery needs. Visit the SBA website here.

For more information on federal assistance for arts and entertainment related entities, contact MELISSA SANDERS at [email protected] or 310.598.4150 or HEIDY VAQUERANO at [email protected] or 424.285.7067 or any member of the firm's Corporate or Entertainment & Sports Law departments.