These Austin businesses are reimbursing employees after cutting their salaries during the pandemic

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AUSTIN (KXAN) — ZACH Theatre is rebuilding after being hit by COVID-19 pandemic shutdowns and revenue losses.

In a press release Monday, organizers say they’ll be using their $2.6 million dollars awarded from the Shuttered Venue Operators Grant (SVOG) to rehire staff and reimburse lost wages.

ZACH says they cut salaries for 21 full-time employees by 10-25% due to COVID reductions, and that every employee will get those wages paid back — totaling about $170,000.

“We had felt, since the beginning, that the most important thing would be to make our employees whole again,” says Elisbeth Challener, managing director of ZACH Theatre. “They were the people that sacrificed for ZACH, they were the people that did whatever it took — if that meant being furloughed, if that meant being laid off, or if that meant being having salary cuts taken.”

Alamo Drafthouse says they are also using their SVOG funds to reimburse lost wages to salaried employees who worked through the pandemic on reduced pay.

Challener says they made that decision even before the money came in. It’s money Greg Garcia wasn’t expecting to see again.

“Just, like, this load lifting off the shoulders,” says Garcia, ZACH Theatre marketing and analytics associate director. “Especially when it came, right like it’s, it’s now. And with back to school things or school supplies and that sort of thing.”

Garcia says with offices and school opening back up, gas and other essentials are starting to add up again, making back-pay a relief. (Photo courtesy Greg Garcia)

Garcia saw 10% shaved off his pay every month for nearly a year.

“Kind of like everybody taking a hit, so that everybody can stay on and…keep doing what we’re doing,” he says.

He and his family scaled back on groceries and utilities.

“We did change our spending patterns overall,” Garcia says.

He worked through the tight budget and says he didn’t think about leaving for another job.

“I love this place,” says Garcia, who has been with the venue for about 12 years. “I kind of felt like I was in this… family of people that are fighting, essentially, to keep theatre going, to keep art alive.”

The venue recently announced its 2021-2022 season and will also use the grant money to get back to pre-COVID staffing levels of 68 employees. Leaders say they’re currently around the halfway mark.

The Small Business Administration closed applications for SVOG on Friday.

The agency dealt with complaints from venues that still hadn’t received funding, months after legislation was passed and applications submitted.

SBA spokesperson June Teasley says since then, they have “moved the SVOG program to another department better equipped to facilitate applications in a more timely way.”

The agency had previously stated that the application requirements were complicated, but Teasley said on Monday that they had not changed those requirements.

The latest data indicates that $12.5 billion has been requested from businesses through the SVOG program and $8.7 billion has been awarded, so far. Congress allocated $16 billion to the program.

Teasley says although SVOG applications are no longer being accepted, the SBA “may reopen the portal or make other adjustments to its plan to best meet the needs of small businesses.”

Garcia working at ZACH Theatre. The managing director says they started bringing back furloughed employees in the spring, then brought cut salaries back to full pay. Now, they are dispensing back-pay. (Photo courtesy Greg Garcia)

The agency will be opening applications for supplemental grants later this month, for those who have already received an initial grant.

Challener says they are hoping for that money, too– which could be up to 50% of the initial award amount.

“I think we can say wholeheartedly that it will go into the art onstage,” says Challener.

She says while the initial funding is going toward hiring employees and back-pay, supplemental funding will be geared toward production and education programs.

It will also go toward replenishing the reserves they had to dip into during the pandemic, after 20 years of balanced budgets.

The latest data report indicates that ZACH Theatre is one of about 90 venues in Austin that have received SVOG funding, so far.

The agency has declined more than 3,000 applications across the country.

Teasley says there are many reasons why that might happen and no specific trends, but that the SBA is currently inviting some of those applicants to apply for reconsideration of award amounts and appeals.

“This rare opportunity gives applicants a chance to prove their eligibility and reverse a prior decision,” she said.

The SBA tells KXAN an updated data report is scheduled to be released Monday afternoon but it had not yet been released as of publication. They were the people that sacrificed for Zach, they were the people that did whatever it took, if that meant being furloughed, if that meant being laid off, or if that meant being having salary cuts taken.

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