A new program available in the Economic Aid Stimulus bill is the Shuttered Venues Grant program.
$15 Billion has been set aside for Shuttered Venue Grants that have at least a 25% reduction in revenue in the first, second, or third quarter of 2020 as compared to the same quarter in 2019.
As of 1/15 - The SBA is not currently accepting applications. The SBA will be prioritizing applicants based on economic loss. First 14 days of program: 90% or greater loss; Second 14 days 70% or greater loss; After 28 days 25% or great loss.
Approved Grant amounts will be equal to 45% of 2019 gross revenue.
Qualifying businesses include:
Live venue operators - must organize, promote, produce, manage, or host live performances and sell tickets to those performances. This includes ticket brokers.
Museums - excluding for-profit museums
The business must meet these 7 requirements:
Operational on February 29, 2020
Had a 25% reduction in revenue when comparing a quarter in 2020 to the same quarter in 2019 (ie. Q3 2020 vs. Q3 2019)
The business intends to reopen
Cannot be publicly traded, receive more than 10% of revenue from federal funding,
Cannot have more than two of the following: located in more than one country, more than ten states, or more than 500 employees (as of Feb 29, 2020.)
No Strip clubs
Cannot receive a PPP (round 1 or 2) after December 27, 2020
Grants received are not taxable and all related expenses are tax-deductible.
Supplemental grants are available beginning April 1, 2021, for businesses with a greater than 30% decline in gross receipts Q1 2021 compared to Q1 2019. This grant will be 50% of the original grant.
Eligible expenses include most operating expenses. (See Appendix for detailed list)
Funds may be used for specific expenses, which include:
Payroll costs, Rent payments, Utility payments
Scheduled mortgage payments (not including prepayment of principal)
Scheduled debt payments (not including prepayment of principal) on any indebtedness incurred in the ordinary course of business before 02-15-20)
Worker protection expenditures
Payments to independent contractors (not to exceed $100K in annual compensation per contractor)
Other ordinary and necessary business expenses, including maintenance costs
Administrative costs (incl. fees and licensing) State and local taxes and fees
Operating leases in effect as of 02-15-20
Advertising, production transportation, and capital expenditures related to producing a theatrical or live performing arts production. (May not be a primary use of funds.)
Grantees may not use award funds to:
Buy real estate
Make payments on loans originated after 02-15-20
Make investments or loans
Make contributions or other payments to, or on behalf of, political parties, political committees, or candidates for election
Any other use is prohibited by the Administrator
Grantees will be required to maintain documentation demonstrating their compliance with the eligibility and other requirements of the SVO Grant program. They must retain employment records for four years following their receipt of a grant and retain all other records for three years.
More info can be found here:
That's all for this week. The EDGe team will keep you up to date on additional guidance that is released by the SBA. Have a great weekend!