Los Angeles Music Scene: Save Our Stages Approved by Congress

The Satellite

The second COVID-19 stimulus bill just got approved by Washington DC (President Trump delayed the signing by a few days when he decided to push for a $2,000 per person check). Of much interest to Los Angeles local music scene fans, it included the Save Our Stages funding of $15 billion. From Rolling Stones (Dec 21):

Legislation allocates $15 billion in funding to “venues, independent movie theaters, and cultural institutions” as Save Our Stages act is folded into $900 billion stimulus bill 

Of the $15 billion, $10 billion is dedicated to music venues and promoters. Venues can apply for grants equal to 45% of 2019 gross revenues with a cap of $10 million. Priority is given to those who lost 90% of their revenue over the last year. Two weeks later, those who have lost 70% can then apply for a grant. Considering that Los Angeles venues shut down in mid-March, that would indicate an 80% drop in revenue if revenues are straight-lined across the year. I'm not sure how revenue trends throughout the year for local venues so I'm not sure if Los Angeles venues will be in the first or second wave.

. . . Speaking on the Senate floor Monday, Amy Klobuchar said the bill will help venues cover six months of expenses to make it through what will hopefully be the tail-end of the pandemic . . . “The grants can be used to cover all the major costs the venues have to pay to stay in business including rent and mortgage utilities, employee wages, key benefits, maintenance costs, state and local taxes, payments to contractors, purchases of protective equipment.”

I focus on the "six months of expenses." Those of us in Los Angeles know that music venues have already been shut down for 9 months. My speculation is that venues won't open until September. Maybe I'm too pessimistic and they open in June. Either way, venues in Los Angeles (and I say Los Angeles, because I have to believe that Texas will allow Austin venues to open up months before Los Angeles allows venues to open) may be shut for 15 to 18 months. Six months of expenses could be just 1 / 3 of the need -- though some of the rest could be covered by borrowing from a bank, fundraising, online concerts, merchandise sales, temporarily getting rent reductions, loan term changes, etc etc.

The Chicago Tribune (Dec 21) adds a Senator Amy Klobuchar Q&A from Variety that considers my above concern.

SINCE SAVE OUR STAGES WILL LARGELY BE COVERING EXPENSES FROM THIS YEAR, DO YOU EXPECT ANOTHER STIMULUS BILL NEXT YEAR?

Yes, especially for the state and local governments and others, and Joe Biden has committed to that. Every month that goes by, you learn about who has been hardest hit -- people as well as businesses, and we’re going to have the benefit of that hindsight by February.

It does seem that Variety and Senator Amy Klobuchar realize that this $10 billion isn't enough and that many venues will still close if additional grants aren't provided. Of course, her answer takes a more macro look at the need for a 3rd stimulus package versus answering directly about music venues. Is that cause for concern or is she just being cautious with her language -- she is a lawyer after all? But my honest opinion is that if various states allow their venues to start opening up soon in 2021, there would be less Congressional support for venues in states that keep them shut down until later in the year.