Shuttered Venue Operators Grant Program Confused by Technical Faults

The Anthem, a popular live music venue, is displaying a message of support on their marquee on April 3, 2020 in Washington, DC.

Drew Angerer | Getty Images

It was literally a long, dark year at the Independent in San Francisco. The music and comedy shows that filled the venue’s stage and boosted the local economy have been halted since early March 2020. Apart from a few sales of goods, total sales have decreased by almost 100%.

“It’s been a devastating year for The Independent and our industry. We are the first to close and the last to reopen,” said Allen Scott, managing director of The Independent.

“All of these little clubs that really are the backbone of the live touring industry aren’t built to lose three, six – let alone twelve or 18 – months of money,” said Scott.

Owners like Scott have been eager to submit their applications to the Small Business Administration’s Shuttered Venue Operators Grant program, a $ 16 billion fund that aims to get the industry going until personal entertainment can resume . Music clubs, theaters, event organizers and more can access grants of up to $ 10 million based on 2019 gross revenues under the program initiated during Covid’s second aid package.

However, the SBA portal faced technical challenges on launch day and the application process is currently suspended.

The portal should be open on Thursday afternoon. However, when it closed at 4:15 p.m., no applications were filed. On Friday it was closed all day while the agency worked on solving the technical problems. Late on Friday, the SBA announced that the portal would be closed for the whole weekend.

“If a reopening date is set, we’ll provide updates in advance so applicants have time to prepare,” the agency said in a tweet late Friday.

When the portal opens, the funds will be distributed based on availability, the agency said.

“This decision was not taken lightly as we understand that this hard-hit industry must be quickly relieved,” SBA spokeswoman Andrea Roebker said in a statement on Thursday, adding that the agency is working on getting them back in as soon as possible To put into operation.

Earlier on Friday, the SBA said, it worked with its vendors to fix the technical problems it had identified.

At the moment the wait continues. Industry reps and owners, grateful for the lifeline, were frustrated with the mishaps and the delay in getting help out the door. The challenges were reminiscent of issues faced the first few days of the paycheck protection program launch last year. This program experienced delays in processing applications.

“We are grateful to the SBA for their hard work creating this program … There is a lot of confusion and fear around the process, but we are still hopeful. The application cannot come soon enough,” said Scott. “Our livelihood depends on it.”

The National Independent Venue Association was formed during the pandemic to advocate for relief. It now represents around 3,000 local venues and promoters across the country.

NIVA estimates that hundreds of venues have permanently closed their doors due to the pandemic. And more are threatened, as the shutdown could extend into summer and autumn. Supporting the struggling venues will be key to rebuilding the economy once things are open again, the group said.

“We’re part of the backbone of our local economy because for every dollar spent on a ticket at a small music venue, it generates $ 12 in economic activity for businesses in the area,” said Audrey Fix Schafer, a board member of the NIVA.

“If they want their communities to come back, they need this economic magnet of independent venues like ours once the full reopening is certain,” she said. The group projects these venues to have a direct annual economic impact of nearly $ 10 billion on local communities.

For many venues, opening with partial capacity is not “economically feasible” due to the high overhead costs, according to the group. National tour routing is also not expected to be in full swing until artists can fully tour in reopened locations.

As owners and operators await help, they are confident that music and theater lovers can return in person later this year, and the program will have ample funding to meet those in need.

Casey Lowdermilk, assistant general manager of the Bill Graham Civic Auditorium in downtown San Francisco, said the venue had grown to zero from 450 employees and 80 concerts a year.

“Hopefully this money will be enough and get to all the venues that need it in time,” Lowdermilk said. “And hopefully by June or July we will have a real track of when we can return to full capacity events that are indoor venues.”

Scott of the Independent is confident that once the opening is certain, the demand will be there.

“We are ready to come back to it,” he said. “People got cooped up. We had some leading indicators in the industry, some festivals that were on sale, and some tours that all stalled. … I’m very optimistic about demand out there. And we can’t wait to open our doors. “

– CNBC’s Whitney Ksiazek contributed to this report.

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