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Concert halls and theaters still waiting for government help for small businesses

The North Park Theater in Buffalo, New York, is a local landmark. With a single screen, 600 seats, and ornate domed ceilings, it’s an increasingly rare gem in a sea of ​​multiplex cinemas.

“This is the kind of place you want to see a movie – you’re going to forget about the outside world and escape for a few hours,” said Ray Barker, the theater’s programming director. He has worked at North Park since the 1990s, when he started out as a dealership clerk.

North Park has been around for a century and has survived major economic shocks like the Great Depression and the Great Recession of 2008. When the Covid pandemic hit it turned dark, and now it is in desperate need of a lifeline. .

Theater expects a $ 200,000 grant he applied for under the Small Business Administration’s Shuttered Venue Operators Grant, Barker said. North Park has reopened as pandemic restrictions have been lifted, but help is crucial in digging the benchmark for a mountain of debt racked up over the past year.

“The bleeding hasn’t stopped for 13 months. This program was supposed to help us, and it didn’t, ”he said. The theater’s request was submitted, but for more than six weeks Barker said he had had no word on his status. On Tuesday, he learned from the SBA that the theater’s application has been approved, with next steps to follow, but it is not yet known when funding will be received.

The SBA’s SVOG program, a $ 16 billion fund, was created to help support the industry until in-person entertainment can resume. Music clubs, theaters, promoters and others can access grants of up to $ 10 million, based on 2019 gross income, under the program, which was included in the second Covid relief plan which was enacted in December.

The program’s application portal was hampered by technology glitches, opening and closing within hours of launching on April 8, with no applications being submitted. It reopened weeks later after an uproar over the delay, and applicants like Barker rushed to resubmit in hopes of securing a much-needed grant.

But now the wait is on for him and thousands of others. At noon Monday, more than two months after SVOG’s initial launch, the SBA announced that 1,445 grants had been awarded for a total of $ 833.4 million. The agency said in its weekly report that 7,118 applications remained in the submission phase and 5,853 were under consideration. The combined applications represent $ 11.6 billion in grants.

One of those nominations is from the Great American Music Hall in San Francisco. Dave Bruno, the site’s general manager, said he was eagerly awaiting information on the status of a request for a $ 2 million grant. He heard the application was “under review” by the SBA, but no word yet on funding..

Waiting delays reopening of plans

Like North Park, the music hall has a rich history, beginning in the early 1900s as a burlesque house, then a restaurant. It was reinvented in concert halls in the 1970s. The aid will help pay off debts, bring back employees and prepare to reopen later this summer, Bruno said.

“We could have reopened earlier if we had had the money, but right now it’s like we’ll be lucky to open when we should be opening,” he said. “By asking us to wait longer, you are asking all of our employees to wait and get back to work.”

In other Covid recovery programs, like the Paycheck Protection Program and the most recent Restaurant Revitalization Fund, beneficiaries received funds within days of their request.

At a Senate hearing in May, new SBA administrator Isabel Guzman said SVOG program money would soon flow to businesses in need, adding that the agency was in regular communication with the parties. stakeholders. She also acknowledged the first technical difficulties with the application portal.

“We are dealing with these requests as quickly as possible. It’s a very complex program by law, with various types of entities, that has created many eligibility requirements along the way… and requires extensive applicant-by-applicant review, ”Guzman said.

In response to questions about the issues and the speed of approval of applications under the program, the agency told CNBC in a statement, “We have [a] dedicated team of hundreds of reviewers working around the clock to process, approve and disburse funds as quickly as possible to get sites across the country back on track. Largely because of legal requirements – created under the last administration – requests require careful consideration. To shed more light, applicants have included 30 to 100 documents in their applications to ensure that they meet the guidelines of the law and that each should be reviewed before proceeding with the grant award process. “

The agency added that its current pace does not reflect the high standards the SBA strives to meet.

A person familiar with the agency’s efforts said she was working with the White House and other agencies to allocate additional resources to secure grants quickly, but manual review of applications slowed the process down. The team that worked on the Restaurant Revitalization Fund is now helping administer the program, fraud controls have been optimized and a new browser program to help with IRS audits is being implemented, said this person. The person requested anonymity as they were not authorized to speak on behalf of the SBA.

“The options are exhausted”

For defenders, the pace of funding is unacceptable. The National Independent Venue Association, formed during the pandemic to help independent operators survive, called on the SBA to resolve its interagency issues and release all funds immediately. The group, which has some 3,000 members across the country and lobbied for the SVOG program, said the sites could not reopen without help.

Audrey Fix Schaefer, NIVA’s communications director, said there have been recent changes and the agency has been more communicative last week, however, desperation among applicants remains.

“The SBA is supposed to help small businesses. Every day that they don’t release that money, conglomerates are helped,” said Fix Schaefer, who is also communications director for several independent sites in the Washington, DC area. “Our people will go to them.… The groups will go to them. It’s not just 2021, it’s for the next five to 10 years.”

The sites must bring back workers, pay off debts and prepare to reopen, Fix Schaefer said. She explained that many operators have exhausted not only emergency aid, but also their personal savings.

“These theater operators have had no income since March 2020. They’ve used up their savings. They’ve put second mortgages on their homes. They’ve used up their 401 (k) and their children’s college funds. They’ve exhausted their children’s college funds. take loans they would never normally have taken if they could, but they are exhausted – their options are exhausted, “she said.

For workers and music lovers like Bruno, the past year has been both a professional and a personal challenge. Help cannot come soon enough.

“For someone like me, and everyone who comes to the shows and participates in the making of the shows, this is our way of life. It is our way of life that is being taken away from us,” he said. about the impact of the pandemic on the live entertainment industry.

Back in Buffalo, Barker’s message is that the grant the theater needs goes far beyond just sustaining the business he runs – it’s about the community.

“They don’t just see a movie – they have a drink or a coffee after the movie to talk about the movie,” he said. “It helps all these little businesses in the neighborhood. We’re kind of a rising tide that lifts all the boats, and if we’re not here to attract people… then they’re hurt. Everyone is interconnected in this economy.”

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