The Shuttered Venue Operator Grant (SVOG) is one of the most recent SBA grant programs. Live venue operators have been particularly hit hard by COVID-19 and this program is designed to give them the extra support that they need.
If this program is successful, we expect that we might see similar programs for the travel and hospitality industry.
This program is new and subject to change at any moment. Be wary of anyone saying they have experience with this program, that they can guarantee or promise a result, or are charging a large contingency fee.
What does the SVOG Program offer?
- For an eligible entity in operation on January 1, 2019, grants will be for an amount equal to 45% of their 2019 gross earned revenue OR $10 million, whichever is less. **
- For an eligible entity that began operation after January 1, 2019, grants will be for the average monthly gross earned revenue for each full month you were in operation during 2019 multiplied by six (6) OR $10 million, whichever is less. **
- NOTE: The grant amount most likely will be adjusted for the amount of funds received through PPP1 and PPP2 programs.
** Taken from Sba.gov on 3/23/2021.
What do you need to apply?
Get started NOW! Even though this program isn’t taking applications yet we suggest that if you are interested, then you should start preparing now for your application.
- This program is scheduled to launch on April 8th. You can preview the application form here: SBA Form 3515 (Note this form is subject to change before it is finalized).
- In the meantime, the SBA has also released a checklist in order to help applicants prepare for when the program launches. The requirements vary depending on the type of business, but one thing of note is that the program requires you to have a DUNs number, a Sams.gov account, and a Cage number.
- The process for getting these things is time-consuming with the SAMs application alone taking several hours to complete (More information on how to do this here).
- Once you have received your DUNs number, SAMs account, and Cage number, you will need to send a notarized letter to the Federal Service Desk to complete your SAMs application (More information on how to do this here).
- If you plan on applying for this program, we suggest you go through this process as soon as possible. To check what other documents you can start gathering, check the SBA checklist here.
DEADLINES: Familiarize yourself with the current forecast of deadlines so that you can have your materials ready when the programs are open to taking applications for your business.
SBA is expected to have a portal set up to start taking applications on April 8th. Starting from that date the application windows will be as follows:
First 14 days of grant awards
|Entities that suffered a 90% or greater revenue loss between April 2020 through December 2020 due to the COVID-19 pandemic.|
Next 14 days of grant awards
|Entities that suffered a 70% or greater revenue loss between April 2020 through December 2020 due to the COVID-19 pandemic.|
Beginning 28 days after first and second priority awards are made
|Entities that suffered a 25% or greater earned revenue loss between one quarter of 2019 and the corresponding quarter of 2020.|
Available after all Priority Periods have passed
|Recipients of first, second, and third priority round awards who suffered a 70% or greater revenue loss for the most recent calendar quarter (as of April 1, 2021, or later).|
Who can apply?
This program is designed to target the live venues that have suffered the most under the pandemic.
Live venue operators or promoters, theatrical producers, live performing arts organization operators, relevant museum operators, zoos and aquariums who meet specific criteria, motion picture theater operators, talent representatives, and each business entity owned by an eligible entity that also meets the eligibility requirements. Additional eligibility requirements can be found here.
It is expected that entities will be ineligible if:
- Operated by a state or local government;
- Have a pending application for or has received a grant under SBA’s Shuttered Venue Operators Grant Program; or
- Is majority-owned or controlled by a publicly traded company.
What can you use it for?
One of the major advantages of these programs is the flexibility in terms of what businesses may or may not use the funds for.
Funds may be used for specific expenses, which include:
- Payroll costs
- Rent payments
- Utility payments
- 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)
- Worker protection expenditures
- Payments to independent contractors (not to exceed $100,000 in annual compensation per contractor)
- Other ordinary and necessary business expenses, including maintenance costs
- Administrative costs (including fees and licensing)
- State and local taxes and fees
- Operating leases in effect as of February 15, 2020
- Insurance payments
- Advertising, production transportation, and capital expenditures related to producing a theatrical or live performing arts production (may not be the primary use of funds).
Grantees may not use award funds 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
LaSusa & Deb, PLLC is here to be a resource for our clients and for the fellow members of our community. Do not hesitate to give us a call at 214-584-6505.