SBA launches portal to begin accepting Shuttered Venue Operators Grant applications on April 8

The U.S. Small Business Administration (SBA) launched a splash page for the Shuttered Venue Operators Grant (SVOG) application portal in anticipation of opening applications for the relief program on Thursday, April 8, 2021. Venue operators and other entities interested in applying for a SVOG can sign up to receive email notifications by going to the splash page and clicking on the red sign-up box.

The SVOG program was established by the Economic Aid to Hard Hit Small Businesses, Nonprofits and Venues Act (Economic Aid Act), which appropriated $15 billion for the program. The American Rescue Plan Act, signed into law by President Joe Biden on March 11, 2021, appropriated an additional $1.25 billion, bringing the SVOG program funding to a total of $16.25 billion, with more than $16 billion allocated for grants.

Eligible entities may be live venue operators or promoters, theatrical producers, live performing arts organization operators, museum operators, motion picture theatre operators, and talent representatives. Additionally, entities of these types owned by state or local governments (for example, museums or historic homes) are eligible to apply if the governmentally-owned entity also acts solely as a venue operator, museum, etc. and not also include other types of entities. The Economic Aid Act requires a venue to have defined performance and audience spaces. If a particular venue cannot meet this requirement, it is not eligible to apply for a SVOG. Eligible applicants may qualify for grants equal to 45% of their gross earned revenue, with the maximum amount available for a single grant award of $10 million. Reserved is $2 billion for eligible applications with up to 50 full-time employees.

The business must have been in operation as of February 29, 2020. If an entity was not in business during 2019, but was conducting business operations on Feb. 29, 2020, including incurring costs of necessary start-up, preparatory activities in the lead time before an anticipated opening date, it is eligible to apply if it can show the required earned revenue loss. Firms not in operation in 2019 may qualify for a SVOG if their gross earned revenues for the second, third, or fourth quarter of 2020 demonstrate a reduction of not less than 25% from their gross earned revenue for the first quarter of 2020. For firms that had commenced start-up operations but were unable to open as anticipated due to the pandemic, they would only be eligible under this alternate method if they had earned revenue in the first quarter of 2020 from sources such as advance ticket sales, merchandising, etc. Firms which had been conducting business operations and incurring expenses in 2020 in a pre-opening capacity but which had no earned revenue for the first quarter of 2020 would not be eligible to apply. 

The American Rescue Plan Act also amended the SVOG program so entities that apply for a PPP loan after Dec. 27, 2020, can also apply for a SVOG, with the eligible entity’s SVOG to be reduced by the PPP loan amount. The PPP loan applications have been updated to reflect this.

The following types of circumstances would preclude an otherwise eligible firm from a SVOG:

• It does not have a place of business located in the United States, does not operate primarily within the U.S., and does not make a significant contribution to the U.S. economy through payment of taxes or use of American products, materials or labor.
• It was not in operation as of Feb. 29, 2020.
• It is a publicly traded corporation, or is majority owned and controlled by a publicly traded corporation.
• It presents live performances or sells products or services of a prurient sexual nature.
• More than 10% of its 2019 gross revenue came from the federal government (not counting disaster assistance).
• It owns or operates venues, theatres, museums or talent agencies in more than one country, owns or operates venues, theatres, museums or talent agencies in more than ten states, AND it had more than 500 employees as of Feb. 29, 2020.
• Five other firms with which it is affiliated have already received SVOG awards.
• It is a museum and other museums with which it is affiliated have already received $10 million in SVOG funding.

The SBA’s website, is the best source for information for those looking to apply for a grant. To prepare in advance of the SVOG application portal opening on April 8, 2021, potential applicants should get registered in the federal government’s System for Award Management (SAM.gov), as this is required for an entity to receive a SVOG, and reference the preliminary application checklist and eligibility requirements.