Cultural institutions are now eligible for federal aid and local support. The New York City Council has enacted legislation to support the hard-hit arts and culture industry and expanded cultural institution access to outdoor and public space. For example, the "Open Culture" program allows cultural institutions to perform on public streets and charge admission for the performances, bringing performance jobs back to the city in a new format. The program is scheduled to begin March 1, 2021 and will remain in effect until October 31, 2021.
A long-awaited stimulus package was passed by Congress on December 23, 2020 and signed by President Trump on December 27, 2020. This package includes $15 billion in aid for cultural institutions, including theaters, museums, zoos, and independent entertainment businesses. To date, these institutions have largely been excluded from or failed to qualify for COVID-19 relief funds.
Under the Save Our Stages Act (the "Act"), cultural institutions may apply for grants from the Small Business Administration, up to $10 million per grant, to support six months of payments to employees and meet such costs as rent, utilities, and maintenance. Applicants must have lost a minimum of 25% of their revenues to qualify. Those who have lost more than 90% of their revenues will be able to apply within the first two weeks after the bill becomes law.
While these grants are welcome news, concerns and uncertainty still exist. First, the Act determines aid based on the amount of revenue lost. This could be troublesome for large nonprofits that typically receive a significant portion of revenues through donations. Second, institutions will be ineligible for a grant if they fall into more than two of the following categories: (i) publicly traded company, (ii) multinational company, (iii) operating in more than 10 U.S. states, (iv) more than 500 full-time employees, and (v) companies that received at least 10% of revenues from government sources. Supporters of the Act stated that these restrictions were meant to keep major movie theaters from applying for relief under the Act, but cultural institutions worry there may be unintended consequences.
We will continue to monitor implementation of the Act and other cultural institution support.