New Relief Programs Available for Arts and Cultural Venues Impacted by COVID-19

New Jersey arts and cultural venues that have been forced to close their doors due to COVID-19 may be eligible for much-needed financial relief under two new programs…

New Jersey arts and cultural venues that have been forced to close their doors due to COVID-19 may be eligible for much-needed financial relief under two new programs, federal relief under the Shuttered Venue Operators Grant (SVOG) and state relief under New Jersey Senate Bill 3521.  As of April 8, 2021, the federal SVOG program began accepting applications, and the same day, Gov. Phil Murphy signed legislation that provides $15 million in federal COVID-19 relief aid for arts and cultural venues throughout New Jersey.

Shuttered Venue Operators Grant

The United States Small Business Administration (SBA) recently announced that it is accepting applications for Shuttered Venue Operators Grants. The program was established by the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, and amended by the American Rescue Plan Act, which includes over $16 billion in grants to shuttered venues.

“We know that, for the stage and venue operators across the nation that help make this culture happen, the pandemic has been devastating,” SBA Administrator Isabella Casillas Guzman said in a press statement. “Too many have been forced to lower the final curtain on their businesses. Today, with more than $16.2 billion available through the Shuttered Venue Operators Grants, help is here.”

Eligible entities include: (i) live venue operators or promoters; (ii) theatrical producers;

(iii) live performing arts organization operators; (iv) relevant museum operators, zoos and aquariums who meet specific criteria; (v) motion picture theater operators; and (vi) talent representatives. Entities must have been in operation as of February 29, 2020 to receive a grant.

Eligible applicants may qualify for grants equal to 45% of their gross earned revenue, with a single grant maximum of $10 million.  A total of $2 billion is reserved for certain eligible applications with up to 50 full-time employees.  Entities that were in operation on January 1, 2019 will be eligible for grants amounting to 45% of their 2019 gross earned revenue, or $10 million, whichever is less.  Entities that began operations after January 1 will be eligible for the average monthly gross earned revenue for each full month in operation during 2019, multiplied by six, or $10 million, whichever is less.

In recent weeks, the SBA has published several documents to help entities verify their eligibility and complete their applications. They include:

• FAQ Regarding Shuttered Venue Operators Grant (SVOG)
• SVOG Eligibility Requirements
• SVOG Preliminary Application Checklist
• Cross-program eligibility on SBA COVID-19 relief options
• SVOG-specific version of IRS Form 4506T

The application portal opened on April 8, 2021, and the SBA is accepting SVOG applications on a first-in, first-out basis. The first 14 days of SVOG awards will be dedicated to entities that suffered a 90% or greater revenue loss between April and December 2020. The second 14 days (days 15-28) will include entities that suffered a 70% or greater revenue loss between April and December 2020. Thereafter, SVOG awards will include entities that suffered a 25% or greater revenue loss between one quarter of 2019 and the corresponding quarter of 2020.

State Relief Under Senate Bill 3521

Senate Bill 3521, a new state law signed by Governor Murphy on April 8, makes $15 million in federal funds available to the Economic Development Authority (NJEDA) and the New Jersey Council on the Arts (Council) to award grants to arts and culture organizations who are in need of support as a result of the public health crisis. “Our arts and cultural establishments are among the best in the nation, but they have faced difficult challenges over the past year,” Gov. Murphy said in a press statement announcing his signing of the new law. “It’s time we lifted up these organizations and venues to ensure they are still with us as we emerge from the pandemic and look to once again experience the joy they offer.”

The new law specifically makes available $7.5 million to the EDA for for-profit organizations and $7.5 million to the council for non-profit organizations. The bill defines an eligible “arts and culture for-profit organization” as one that: (1) either organizes, promotes, produces, manages, or hosts at least two regularly occurring live performances or events per week by performing artists for which admission fees are charged and performers are paid based on a percentage of sales, a guarantee, or other mutually beneficial formal arrangement or publicly sells tickets in advance of performing arts events for which performers are paid based on a percentage of sales, a guarantee, or other mutually-beneficial formal arrangement; and (2) can demonstrate to the authority a 25 percent or greater operating revenue loss in the second quarter of 2020 compared to the second quarter of 2019. The NJEDA is tasked with further defining the size of the awards and eligibility requirements.

Applications for grants under Senate Bill 3521 are not yet open.

If you have questions, please contact us

If you have any questions or if you would like to discuss the matter further, please contact me, Zachary Klein, or the Scarinci Hollenbeck attorney with whom you work, at 201-896-4100.