Events and venues affected by the COVID-19 pandemic throughout the U.S. have been waiting for relief that would address the live event industry's unprecedented losses, and on January 14th, 2021, the U.S. Small Business Administration (SBA) presented their plan to support the events industry: the Shuttered Venue Operators Grant (SVO). What is the SVO, what does it mean to event organizers, are you eligible, and how can you apply? We break down everything you need to know about the grant in simple terms below, including how much funding you can expect to receive and where to get more information.
What is the Shuttered Venue Operators Grant?
The SVO Grant is part of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, and includes a total of $15 billion in grants to shuttered venues. These grants will be administered by SBA’s Office of Disaster Assistance. At the time of writing, exact details of how the grant will be processed are being worked out.
How much can venues expect to receive from the SVO Grant?
How much your venue or live event organization gets from the SVO Grant will depend on when you started your operations.
If you started your operations before January 1, 2019, the grant will equal to 45% of your 2019 gross earned revenue, up to a maximum of $10 million.
If you started your operations after January 1, 2019, the grant amount will be calculated by taking the average monthly gross revenue for each full month you were in operation during 2019 and multiplying it by six (6), up to a maximum of $10 million.
Note on availability: out of the total of $15 billion, $2 billion has been reserved for eligible applicants with up to 50 employees. This means that the SVO will be distributed to both large and small live event organizations, and you should apply if you meet the eligibility criteria regardless of your organization’s size.
Who is eligible for the Shuttered Venue Operations Grant?
While specific details about the SVO Grant’s eligibility criteria are still pending, there are a few broad guidelines.
You are eligible to apply for the SVO Grant is you are one of the following:
- Live venue operator or promoter
- Theatrical producer
- Live performing arts organization operator
- Relevant museum operator, zoo and aquarium that meets specific criteria
- Motion picture theater operator
- Talent representative
- A business entity owned by an eligible entity that also meets the eligibility requirements
You must also:
- Have been in operation as of February 29, 2020
- As a venue or promoter must not have received a PPP loan on or after December 27, 2020
How do I apply for the grant?
The SBA is not yet accepting applications, however they have released a schedule for the order which the applications will be processed, which will be based on the degree of economic loss suffered by your organisation.
SVO Grant application processing schedule
Your application will be closer to the front of the line of being processed depending on how much revenue you lost. Furthermore, if you qualify for the first or second priority due to 2020 losses, you may also apply to receive Supplemental Funding for losses experienced during the most recent 2021 quarter. Here’s what the SVO Grant’s schedule looks like:
Days 1 to 14.
If you lost 90% or more of your revenue between April 2020 and December 2020 as a result of COVID-19 pandemic, your application will be placed in the first priority.
Days 15 to 28.
If you lost 70% or more of your revenue between April 2020 and December 2020 as a result of COVID-19 pandemic, your application will be placed in the second priority.
Begins after the 28 days during which First and Second Priority awards were granted.
If you lost 25% or more of your revenue between April 2020 and December 2020 as a result of COVID-19 pandemic, your application will be placed in the second priority.
Is made available after the First and Second Priority.
If you are awarded a First or Second Priority grant, and lost 70% or more of your revenue in most recent calendar quarter (as of April 1, 2021).
How am I allowed to use the funds from the SVO Grant?
There are a number of acceptable expenses that can be covered by the SVO Grant, as well as a number of ways that you are prohibited from spending the funds.
You are allowed to use the SVO Grant funds to cover essential operation expenses, labor costs, taxes and debts. Here they are in detail:
Eligible labor-related expenses:
- Cover your payroll costs
- Pay for expenses related to worker protection
- Pay independent contractors, as longs as the annual compensation does not exceed $100k per contractor
Eligible operating expenses:
- Make payments for your rent and utilities
- Cover ordinary business expenses as well as maintenance costs
- Cover administrative costs as well as fees and licensing
- Pay your state and local taxes
- Make insurance payments
Eligible debt and mortgage payments:
- Make 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 prior to February 15, 2020)
- Operating leases in effect as of February 15, 2020
Eligible production specific costs:
- You are allowed to use the SVO Grant for advertising, production transportation, and capital expenditures related to producing a theatrical or live performing arts production, however this may not be the primary use of the funds.
Finally, the SBA has also detailed areas where you are not allowed to use the funds.
You may NOT use funds from the SVO Grant to:
- Buy real estate
- Make payments on loans originated after February 15, 2020
- 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 prohibited by the Administrator
What records will I need to maintain after receiving the grant?
If you receive the SVO Grant, you will need to keep records that show your compliance with the program’s requirements. This includes proof of your organization’s eligibility, as well as other requirements such as compliance with the fund allocation guidelines.
You will need to retain your employment records for four years after receiving the grant, and keep all other records for three years.
Where do I get more information about the grant?
The SBA has provided an email for getting additional information. While they are likely to be experiencing a lot of inquiries, you can reach out at SVOGrant@sba.gov.