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SPOTLIGHT on the SOS and RESTART Acts

Published on: September 12th, 2020

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The devastation COVID-19 has wrought was nearly unimaginable a scant 8 months ago. Today, we face the greatest GDP plunge in history, unprecedented unemployment, and the heartbreaking loss of more than 160,000 American lives (and counting). Amid the widespread economic impact, though, one industry stands out as utterly cratered at this point. Colorado’s live music scene is shuttered, stages are empty and there is no light at the end of this tunnel save what Levitt Pavilion CEO Chris Zacher refers to as a, “Hail Mary.” Two bills are up for debate in Congress: S. 4258, the Save Our Stages Act, introduced by Senators Cornyn and Klobuchar, and S. 3814/H.R. 7481, the RESTART Act, introduced by Senators Young and Bennet in the Senate and Representatives Golden and Kelly in the House. “The SOS Act and RESTART Act are key components to the short and long term survival of the live music industry across the United States,” Zacher says. “Without at least one of these two Acts passing through Congress, 90percent of the independent music venues across Colorado and the US will permanently close.” I interviewed Zacher and a few other independent venue owners on the Front Range about the state of their business, the impact of COVID-19 they’re seeing, and what these acts mean to them and the future as they see it.

 

French Davis: Tell me about the impact COVID-19 has had on your venues specifically.

 

Andy Bercaw (Owner, Oriental Theater, Denver): It took less than 7 days to deconstruct a year’s worth of work: booking, contracts, budgeting, forecasting/planning, marketing. At this point we are five months dark… This pandemic has not only temporarily boarded up the theater, but has left close to 20 part-time and full-time employees out of work, making the future uncertain for everyone involved. 

 

Marc Gitlin (Owner, Nissi’s, Lafayette): I had just reached a verbal agreement to move the venue to a new location in Lafayette after a frustrating attempt at negotiating a lease at my previous location… My intention was to announce the move, have a 2-month farewell party, and leave with the necessary capital to start the new location. Well, the sudden March 11 closing devastated my plans. I was left with a $20,000 food and beverage inventory and was unable to operate for the last two months which devastated my start-up capital… The federal response has made this even more infuriating because there is no sense of a plan, so it’s impossible to even begin to plan an investment or opening.

 

FD: Tell me about how it’s impacted the music scene in Colorado overall

 

MG: The strongest live music fan demographic in the Front Range is 40-60 age group, and most of the musicians are in this demographic as well. The virus seems to be a more serious concern for these groups, so many venues would be left devastated even if they were allowed to open.  While restaurants can struggle to navigate opening with proper sanitizing  procedures, there is no possible way to do the same at a live music venue.  Also, live music venues are not only selling the music, but it is a night out to engage with friends, meet new friends, laugh, celebrate occasions, and have fun which is the antithesis of the kind of behavior required to avoid the virus.

 

CZ: The impact of COVID-19 has been devastating to the live music industry. But the industry as a whole is much deeper than just the venue owners and talent on stage. On any given night, a venue such as Levitt employs between 15 and 70 people. When you step back and analyze every venue in the state, the numbers are astronomical. The independent venues alone — not including AEG or Live Nation-controlled venues — represent close to $700M a year in economic impact for the State of Colorado. This economic impact is not just related to ticket sales, merch, or food and beverage purchases at the venue; this represents the total economic impact for other businesses that depend on the live music crowds for their livelihood (ride-share, hotels, restaurants, gas stations, etc). When you break all of the data down, the results represent thousands of individuals who are left without a job or health insurance. 

 

Laura Newman (Owner, Herb’s Hideout, Denver): As far as the scene goes, the devastation is heartbreaking. Iconic clubs have closed. No concerts. No jam sessions.

 

FD: Share your thoughts on the bills before Congress and why they matter. 

 

AB: Music venues were the first to close and will likely be the last to open at a somewhat normal capacity, and it will be nearly impossible for many independents to get on the other side of this economic turmoil without help. Not to mention, these local venues have always been at risk in an industry already being dominated by corporate entertainment giants with deep pockets. 

 

LN: A definition of culture is, “maintains conditions suitable for growth.” Without help, our decades of artistic culture will vanish.

 

CZ: The Save Our Stages Act:

Establishes a $10 billion grant program for live venue operators, promoters, producers and talent representatives.

Directs the Small Business Administration to make grants to eligible recipients equal to the lesser of either 45% of gross revenue from 2019 or $12 million.

Allows the Small Business Administration to issue supplemental grants in the future if funding remains available and applicants can demonstrate continued need based on continued revenue loss.

Permits recipients to use grants for costs incurred during the COVID pandemic for rent, utilities, mortgage obligations, PPE procurement, payments to contractors, regular maintenance, administrative costs, taxes, operating leases, and capital expenditures related to meeting state, local, or federal social distancing guidelines.

 

Meanwhile, the RESTART Act

 

Includes forgiveness for the hardest hit businesses based on revenue loss. Our industry is experiencing 100% revenue loss. We cannot take on more debt with negative cash flow.

Provides loan amounts based on gross revenue as well as flexibility in the usee of those funds. Our venues have no work to offer employees. We also have high overhead (large spaces, often in high-rent districts) and low payroll. Therefore, having loan amounts based on multiple expenses/gross revenue/operating costs, and not just payroll is crucial.

Doesn’t penalize businesses with part-time employees:  PPP is available to businesses with fewer than 500 employees using a complete headcount. 

Without one of these acts passing through Congress live music as we all know it will be a thing of the past. 

 

 

FD: What other ideas do you have on a local scale that could help the situation?

 

AB: Keep up with the awesome live streams from local bands and musicians, writing, sharing, creating and fundraising. People want to hear music, even if it’s just in their living room or their porch at home. And support local business and arts and culture as much as possible. 

 

MG: Other than the financial assistance, there needs to be large-scale community support and appreciation. Venue patrons and private event coordinators should embrace admission fees, order food and drinks, and understand how hard it’s been and how lucky we are to have such a vibrant music scene in Colorado.

 

LN: Locally, outside gigs and parties have been cropping up. I’m at a loss for ideas when cold weather hits. Online collaborations are nice , but there is nothing that replaces live music interaction.

 

FD: What advice would you offer to local musicians, private venue owners and fans to get them more involved?

 

CZ: I’ve been asked this question a lot over the past four months. Without venues you don’t have concerts, without concerts artists can’t continue doing what they are doing for a living. Everyone, and I mean everyone, who works in the industry or who enjoys going to concerts needs to understand that this is not a drill and that the data that we are giving you is reliable. We need everyone to go to nivassoc.org to take action. It takes 30 seconds to complete a form that will automatically forward to your Congressional representatives. 

 

AB: Everyone needs to take a minute and visit the Save Our Stages website (www.saveourstages.com) and let Congress know just how vital this is for small business and arts and culture in our state. Time is running out and tragically, venues continue to close every day.

 

MG: Unfortunately, the hospitality industry is notoriously decentralized and unfocused because we’re too busy working hard and trying to make a living on low profit margins. Now is the time to find our voice and make sure we’re even being considered for assistance as America battles the virus. Many industries have been devastated by Covid, but as soon as a cure is announced, people won’t be partying at insurance companies offices or Amazon warehouses but rather their local clubs, bars, and venues.

 

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