PPP loan or Save Our Stages grant? Austin venues weigh COVID-19 relief options

Austin

AUSTIN (KXAN) — The COVID-19 relief package signed by President Donald Trump over the weekend also approves grant money for performance venues called “Save Our Stages.”

There’s also a second round of Paycheck Protection Program loans, but venues can’t apply for both.

Some, like the Elephant Room, are weighing their options.

“We’re a basement bar. We understand that this is not the first place that’s going to reopen,” said Michael Mordecai, music manager for the Elephant Room and a trombone player.

Mordecai says federal funding opportunities will help them stay afloat until then. He says they’re discussing options with their certified public accountant but are leaning toward applying for the Save Our Stages grant or SOS.

SOS recipients can get grants up to $10 million.

“It’s not much of a decision in my eyes,” said Mitch Roberts, Evo Entertainment Group CEO.

Roberts says they applied for a PPP loan earlier this year but will be opting for SOS this time around, which doesn’t have to be paid back. He says the rules are also more flexible and tailor made to their industry.

“The use of funds isn’t quite as restricted. It allows us to not only pay for payroll but pay for things like rent… accounts payable stuff where we’re needing to pay a vendor or independent contractor that was supposed to play a show or marketing expenses for said show or for said film coming out,” he explained.

The National Independent Venue Association, a strong advocate of SOS, lists these reasons and more as to why PPP loans weren’t effective for this industry.

Roberts hopes the Small Business Administration will start disbursing money in the next couple weeks. Until then, there’s another lifeline for dozens of Austin venues through the city’s SAVES fund.

“That $20,000, it’s going to be a very crucial band aid in getting venues at least to a place right now where they can stop the bleeding until some more aid comes in,” said Patrick Buchta, executive director of the nonprofit advocacy group Austin Texas Musicians.

Buchta says about 70 live music venues have applied for the city’s grant, and he expects those same businesses to apply for the SOS grant.

Mordecai says they just received their SAVES grant and are using it to help start a ‘club cast’ and broadcast shows online.

“Hearing that SOS passed, hearing that we’ve now got money in the bank from the SAVES Act—the Elephant Room is jazzed about all that,” he said.

The City of Austin SAVES fund is taking applications through Jan. 11. You can find more information here.

How will SOS be disbursed?

According to the SBA, hardest-hit venues will get priority for the first 28 days of the program. The agency says a reserve fund will be set up for venues after that priority period.

There will also be $2 billion reserved for venues that have 50 or fewer employees.

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