SBA Shuttered Venue Operators Grant Program (SVOG)

Changes from April 9, 2021 to April 12, 2021

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SBA Shuttered Venue Operators Grant
April April 912, 2021 , 2021
Program (SVOG)
Robert Jay Dilger
The Small Business Administration (SBA) administers several types of programs to support The Small Business Administration (SBA) administers several types of programs to support
Senior Specialist in Senior Specialist in
small businesses, including direct disaster loan programs to assist their recovery from natural small businesses, including direct disaster loan programs to assist their recovery from natural
American National American National
disasters; loan guaranty and venture capital programs to enhance their access to capital; disasters; loan guaranty and venture capital programs to enhance their access to capital;
Government Government
management and technical assistance training programs to assist business formation and management and technical assistance training programs to assist business formation and

expansion; and contracting programs to increase their opportunities in federal contracting. expansion; and contracting programs to increase their opportunities in federal contracting.
Sean Lowry
Analyst in Public Finance Analyst in Public Finance
Congressional interest in the SBA’s programs has always been high, but has become especially Congressional interest in the SBA’s programs has always been high, but has become especially

acute in the wake of the Coronavirus Disease 2019 (COVID-19) acute in the wake of the Coronavirus Disease 2019 (COVID-19) pandemic’s widespread adverse pandemic’s widespread adverse
economic impact on the U.S. economy. During the 116th Congress, in an effort to assist small economic impact on the U.S. economy. During the 116th Congress, in an effort to assist small

businesses adversely affected by COVID-19, Congress approved legislation that provided the businesses adversely affected by COVID-19, Congress approved legislation that provided the
SBA $1.088SBA $1.088 trillion in appropriations, a 35,282% increase over the $3.075 billion the SBA received during the 115th trillion in appropriations, a 35,282% increase over the $3.075 billion the SBA received during the 115th
Congress.Congress.
Most of the SBA’s funding during the 116th Congress was provided through supplemental appropriations for new and Most of the SBA’s funding during the 116th Congress was provided through supplemental appropriations for new and
expanded programs, including the Paycheck Protection Program ($806.45 billion), Economic Injury Disaster Loans ($50.02 expanded programs, including the Paycheck Protection Program ($806.45 billion), Economic Injury Disaster Loans ($50.02
billion), Emergency Economic Injury Disaster Loan advance (grant) payments ($20 billion), Targeted Economic Injury billion), Emergency Economic Injury Disaster Loan advance (grant) payments ($20 billion), Targeted Economic Injury
Disaster Loan advance (grant) payments ($20 billion), and the Shuttered Venue Operators Grant (SVOG) program ($15 Disaster Loan advance (grant) payments ($20 billion), and the Shuttered Venue Operators Grant (SVOG) program ($15
billion). billion).
This report focuses on the new $16.25 billion SVOG This report focuses on the new $16.25 billion SVOG program—authorized by P.L. 116-260,program—authorized by P.L. 116-260, the Economic Aid to Hard-Hit the Economic Aid to Hard-Hit
Small Businesses, Nonprofits, and Venues Act (Division N, Title III of the Consolidated Appropriations Act, 2021), provided Small Businesses, Nonprofits, and Venues Act (Division N, Title III of the Consolidated Appropriations Act, 2021), provided
an additional $1.25 billion by P.L. 117-2, the American Rescue Plan Act of 2021, and administered by the SBA’s Office of an additional $1.25 billion by P.L. 117-2, the American Rescue Plan Act of 2021, and administered by the SBA’s Office of
Disaster Assistance—which provides grants to shuttered venues affected by the COVID-19 pandemic. Eligible participants Disaster Assistance—which provides grants to shuttered venues affected by the COVID-19 pandemic. Eligible participants
include live venue operators or promoters; theatrical producers; live performing arts organization operators; “relevant” include live venue operators or promoters; theatrical producers; live performing arts organization operators; “relevant”
museum operators, including zoos and aquariums; motion picture theater operators; talent representatives; and subsidiaries of museum operators, including zoos and aquariums; motion picture theater operators; talent representatives; and subsidiaries of
eligible entities that also meet the program’s eligibility requirements. eligible entities that also meet the program’s eligibility requirements.
Qualifying applicants can receive an initial grant equal to 45% of their gross earned revenue, up to $10 million. No less than Qualifying applicants can receive an initial grant equal to 45% of their gross earned revenue, up to $10 million. No less than
$2 billion in grant funding is reserved for eligible applicants with up to 50 full-time equivalent employees. Supplemental $2 billion in grant funding is reserved for eligible applicants with up to 50 full-time equivalent employees. Supplemental
grants equal to 50% of an initial grant (subject to the $10 million total cap) are also available under specified circumstances. grants equal to 50% of an initial grant (subject to the $10 million total cap) are also available under specified circumstances.
This report examines the SVOG’s legislative origins, implementation, eligibility requirements, grant amounts, statutory This report examines the SVOG’s legislative origins, implementation, eligibility requirements, grant amounts, statutory
requirements prioritizing the grant awards to qualified applicants who have suffered the greatest economic requirements prioritizing the grant awards to qualified applicants who have suffered the greatest economic ~~loss~~los s, allowable use , allowable use
of proceeds, and recordkeeping requirements. It assesses the administrative challenges facing the SBA, which has a great deal of proceeds, and recordkeeping requirements. It assesses the administrative challenges facing the SBA, which has a great deal
of experience administering lending programs but much less experience administering grant programs for for-profit of experience administering lending programs but much less experience administering grant programs for for-profit
businesses. It also discusses congressional oversight issues likely to arise over the coming months, including assessing the businesses. It also discusses congressional oversight issues likely to arise over the coming months, including assessing the
program’s efficacy in assisting small businesses. program’s efficacy in assisting small businesses.
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Introduction
Congressional interest in the Congressional interest in the ~~Small~~ Smal Business Administration (SBA) has become Business Administration (SBA) has become ~~especially~~especial y acute acute
in the wake of the Coronavirus Disease 2019 (COVID-19) pandemic’s widespread adverse in the wake of the Coronavirus Disease 2019 (COVID-19) pandemic’s widespread adverse
economic impact on the U.S. economy, including productivity losses, supply chain disruptions, economic impact on the U.S. economy, including productivity losses, supply chain disruptions,
major labor dislocation, and significant financial pressure on both businesses and households. major labor dislocation, and significant financial pressure on both businesses and households.
During the 116th Congress, in an effort to assist During the 116th Congress, in an effort to assist ~~small~~ smal businesses adversely affected by COVID-businesses adversely affected by COVID-
19, Congress approved legislation that provided the SBA19, Congress approved legislation that provided the SBA $1.088 $1.088 ~~trillion~~tril ion in appropriations, a in appropriations, a
35,282% increase over the $3.075 35,282% increase over the $3.075 ~~billion~~bil ion the SBA the SBA received during the 115th Congress.1 Most of received during the 115th Congress.1 Most of
the SBA’s funding during the 116th Congress was provided through supplemental appropriations the SBA’s funding during the 116th Congress was provided through supplemental appropriations
for new and expanded programs, including the Paycheck Protection Program (PPP; $806.45 for new and expanded programs, including the Paycheck Protection Program (PPP; $806.45
~~billion~~bil ion), Economic Injury Disaster Loans (EIDL; $50.02 ), Economic Injury Disaster Loans (EIDL; $50.02 ~~billion~~bil ion), Emergency EIDL advance ), Emergency EIDL advance
(grant) payments ($20 (grant) payments ($20 ~~billion~~bil ion), and Targeted EIDL advance (grant) payments ($20 ), and Targeted EIDL advance (grant) payments ($20 ~~billion~~bil ion).2 In ).2 In
addition, Congress appropriated $15 addition, Congress appropriated $15 ~~billion~~bil ion for a new, Shuttered Venue Operators Grant (SVOG) for a new, Shuttered Venue Operators Grant (SVOG)
program.3program.3
During the 117th Congress, P.L. 117-2, the American Rescue Plan Act of 2021, provided the SBA During the 117th Congress, P.L. 117-2, the American Rescue Plan Act of 2021, provided the SBA
an additionalan additional $53.6 $53.6 ~~billion~~bil ion, including $1.25 , including $1.25 ~~billion~~ bil ion for the SVOG.4 for the SVOG.4
The $16.25 The $16.25 ~~billion~~ bil ion SVOG program, which provides grants to shuttered venues affected by the SVOG program, which provides grants to shuttered venues affected by the
COVID-19 pandemic, can be distinguished among these other economic relief programs, in part, COVID-19 pandemic, can be distinguished among these other economic relief programs, in part,
because it is targeted to certain types of entities in the arts and entertainment industry—live because it is targeted to certain types of entities in the arts and entertainment industry—live
performance venues, museums, and movie theaters—instead of “performance venues, museums, and movie theaters—instead of “~~small~~ smal businesses,” more businesses,” more
~~generally~~general y. These lines of business are among those most significantly affected by COVID-19 and . These lines of business are among those most significantly affected by COVID-19 and
are projected to be among the most delayed to recover to pre-pandemic levels of economic are projected to be among the most delayed to recover to pre-pandemic levels of economic
activity.5activity.5
This report examines the SVOG’s legislative This report examines the SVOG’s legislative origins, implementation, eligibilityorigins, implementation, eligibility requirements, requirements,
grant amounts, statutory requirements prioritizing the grant awards to qualified applicants who grant amounts, statutory requirements prioritizing the grant awards to qualified applicants who
have suffered the greatest economic loss, have suffered the greatest economic loss, ~~allowable~~al owable use of proceeds, and recordkeeping use of proceeds, and recordkeeping

~~1 The Small Business~~ 1 T he Small Business Administration (SBA) received $1.92 billion in regularAdministration (SBA) received $1.92 billion in regular appropriations and $1.086 trillion in appropriations and $1.086 trillion in
supplemental appropriations during the 116th Congress and $1.416 billion in regularsupplemental appropriations during the 116th Congress and $1.416 billion in regular appropriations and $1.659 billion appropriations and $1.659 billion
in supplemental appropriations for disaster assistance duringin supplemental appropriations for disaster assistance during ~~the 115th~~ the 115 th Congress. Congress.
For additional information and analysis of the SBA’sFor additional information and analysis of the SBA’s appropriations, see CRSappropriations, see CRS Report R43846, Report R43846, Small Business
~~Administration~~Adm inistration (SBA) Funding: Overview and Recent Trends, by Robert Jay Dilger. , by Robert Jay Dilger.
2 For additional information and analysis of these programs, see CRS2 For additional information and analysis of these programs, see CRS Report R46284, Report R46284, COVID-19 Relief Assistance to
~~Small~~ to Sm all Businesses: Issues and Policy Options, by Robert Jay Dilger, Bruce, by Robert Jay Dilger, Bruce R. Lindsay, and SeanR. Lindsay, and Sean Lowry ~~Lowry~~. .
3 Enacted as part of P.L. 116-260, the Economic Aid to Hard-Hit Small 3 Enacted as part of P.L. 116-260, the Economic Aid to Hard-Hit Small Businesses,Businesses, Nonprofits, and VenuesNonprofits, and Venues Act Act
(Division N, (Division N, ~~Title~~T itle III of the Consolidated Appropriations Act, 2021, hereinafter P.L. 116-260). III of the Consolidated Appropriations Act, 2021, hereinafter P.L. 116-260).
4 For additional information and analysis of these programs, see CRS4 For additional information and analysis of these programs, see CRS Report R46284, Report R46284, COVID-19 Relief Assistance to
~~Small~~ to Sm all Businesses: Issues and Policy Options, by Robert, by Robert Jay Dilger, BruceJay Dilger, Bruce R. Lindsay, and SeanR. Lindsay, and Sean Lowry ~~Lowry~~. .
5 For example, the unemployment rate in the arts, entertainment, and recreation industry was 19.1% in January 2021 5 For example, the unemployment rate in the arts, entertainment, and recreation industry was 19.1% in January 2021
compared to 4.7% in January 2020. Seecompared to 4.7% in January 2020. See U.S. Department of Labor Bureau of Labor Statistics, “U.S. Department of Labor Bureau of Labor Statistics, “~~Table~~ T able A-31 A-31
Unemployed Persons by Industry, ClassUnemployed Persons by Industry, Class of Worker, and Sex,”of Worker, and Sex,” Labor Force Statistics from the Current Population
Survey (last modified February 5, 2021). According to one estimate, the arts, entertainment, and recreation industry is (last modified February 5, 2021). According to one estimate, the arts, entertainment, and recreation industry is
expected to take the longest time to recover (by 2024 or later) to the 2019 level of output. See McKinsey & Company, expected to take the longest time to recover (by 2024 or later) to the 2019 level of output. See McKinsey & Company,
Covid-19 Recovery in Hardest-hit Sectors Could Take More Than 5 Years, July, July 29, 2020, at 29, 2020, at
https://www.mckinsey.com/featured-insights/coronavirus-leading-through-the-crisis/charting-the-path-to-the-next-https://www.mckinsey.com/featured-insights/coronavirus-leading-through-the-crisis/charting-the-path-to-the-next-
normal/covid-19-recovery-in-hardestnormal/covid-19-recovery-in-hardest -hit-sectors-could-take-more-than-5-years#. -hit-sectors-could-take-more-than-5-years#.
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requirements. It also discusses issues of likely interest to Congress, including oversight of the requirements. It also discusses issues of likely interest to Congress, including oversight of the
program’s implementation and ways to measure program performance. program’s implementation and ways to measure program performance.
Legislative Origins
P.L. 116-136, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act), signed P.L. 116-136, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act), signed
into law on March 27, 2020, among other provisions, created the $349 into law on March 27, 2020, among other provisions, created the $349 ~~billion~~bil ion (now $806.45 (now $806.45
~~billion)~~ bil ion) Paycheck Protection Program (PPP), which provides low-interest, forgivable loans to Paycheck Protection Program (PPP), which provides low-interest, forgivable loans to
~~small~~ smal businesses adversely affected by the COVID-19 pandemic.6businesses adversely affected by the COVID-19 pandemic.6
Several organizations, including the National Independent Venue Association (NIVA), argued that Several organizations, including the National Independent Venue Association (NIVA), argued that
PPP loan requirements limited the program’s value for live venue operators. For example, they PPP loan requirements limited the program’s value for live venue operators. For example, they
pointed out that businesses must have a headcount of 500 or fewer employees to be eligible for a pointed out that businesses must have a headcount of 500 or fewer employees to be eligible for a
PPP loan. Each employee is counted regardless of the number of hours worked. Because live PPP loan. Each employee is counted regardless of the number of hours worked. Because live
venue operators venue operators ~~typically~~typical y depend on part-time employees, many of them were deemed ineligible depend on part-time employees, many of them were deemed ineligible
for PPP assistance, even though their full-time equivalent employee count was below 500 for PPP assistance, even though their full-time equivalent employee count was below 500
employees. These organizations also argued that live venue operators tend to have high overhead employees. These organizations also argued that live venue operators tend to have high overhead
expenses and lower payroll costs as a percentage of expenses than other businesses, making it expenses and lower payroll costs as a percentage of expenses than other businesses, making it
difficult for live venue operators to meet the PPP’s requirement that at least 60% of the loan difficult for live venue operators to meet the PPP’s requirement that at least 60% of the loan
proceeds have to be used on payroll to obtain full loan forgiveness.7 proceeds have to be used on payroll to obtain full loan forgiveness.7
In recognition of these arguments, on July 7, 2020, Representative Peter Welch introduced H.R. In recognition of these arguments, on July 7, 2020, Representative Peter Welch introduced H.R.
7806, the Save our Stages Act (SOS Act). The 7806, the Save our Stages Act (SOS Act). The ~~bill~~ bil was cosponsored by Representative Roger was cosponsored by Representative Roger
~~Williams,~~ Wil iams, signaling that the signaling that the ~~bill~~ bil had bipartisan support. The had bipartisan support. The ~~bill~~ bil subsequently had 174 cosponsors. subsequently had 174 cosponsors.
The The ~~bill~~ bil would have authorized the SBAwould have authorized the SBA to make grants to eligibleto make grants to eligible live venue operators, live venue operators,
producers, promoters, or talent representatives with 500 or fewer full-time equivalent employees producers, promoters, or talent representatives with 500 or fewer full-time equivalent employees
who have demonstrated, through revenue losses, that they have been adversely affected by the who have demonstrated, through revenue losses, that they have been adversely affected by the
COVID-19 pandemic. COVID-19 pandemic. ~~Specifically~~Specifical y, the SBA would have been authorized to make an initial, the SBA would have been authorized to make an initial grant grant
to eligibleto eligible operators, promoters, producers, or talent representatives equal to 45% of their 2019 operators, promoters, producers, or talent representatives equal to 45% of their 2019
gross revenue, capped at $12 gross revenue, capped at $12 ~~million~~mil ion, and a supplemental grant equal to 50% of the initial, and a supplemental grant equal to 50% of the initial grant grant
if, as of December 1, 2020, their revenue for the most recent calendar quarter is not more than if, as of December 1, 2020, their revenue for the most recent calendar quarter is not more than
20% of the revenue for the corresponding quarter during 2019. The initial grant award was to be 20% of the revenue for the corresponding quarter during 2019. The initial grant award was to be
used for eligibleused for eligible expenses incurred during the period beginning on March 1, 2020, through expenses incurred during the period beginning on March 1, 2020, through
December 31, 2020. Supplemental grants could be used for eligible expenses incurred during the December 31, 2020. Supplemental grants could be used for eligible expenses incurred during the
period beginning on March 1, 2020, through June 30, 2021. Specified eligibleperiod beginning on March 1, 2020, through June 30, 2021. Specified eligible expenses included, expenses included,
among others, payroll costs, rents, utilities, mortgage interest payments, and personal protective among others, payroll costs, rents, utilities, mortgage interest payments, and personal protective
equipment. The equipment. The ~~bill~~ bil was referred to the House Committee on was referred to the House Committee on ~~Small~~ Smal Business. Business.
Senator John Cornyn introduced an identical companion Senator John Cornyn introduced an identical companion ~~bill~~ bil (S. 4258) in the Senate on July 22, (S. 4258) in the Senate on July 22,
2020. The 2020. The ~~bill~~ bil was co-sponsored by Senator Amy Klobuchar, signaling that the was co-sponsored by Senator Amy Klobuchar, signaling that the ~~bill~~ bil had bipartisan had bipartisan
support, and referred to the Committee on support, and referred to the Committee on ~~Small~~ Smal Business and Entrepreneurship. The Business and Entrepreneurship. The ~~bill~~
bil subsequently had 58 cosponsors. subsequently had 58 cosponsors.
Several organizations, including NIVA and the National Independent Talent Organization, Several organizations, including NIVA and the National Independent Talent Organization,
gathered support for the gathered support for the ~~bills~~bil s. For example, NIVA claimed that it was part of an effort that . For example, NIVA claimed that it was part of an effort that

6 For additional information and analysis of SBA-related6 For additional information and analysis of SBA-related COVID-19COVID-19 programs, see CRSprograms, see CRS Report R46284, Report R46284, COVID-19
Relief Assistance to ~~Small~~Sm all Businesses: Issues and Policy Options, by, by Robert Jay Dilger, BruceRobert Jay Dilger, Bruce R. Lindsay, and Sean R. Lindsay, and Sean
Lowry. Lowry.
7 National Independent Venue Association (NIVA), “About NIVA,” 7 National Independent Venue Association (NIVA), “About NIVA,” ~~accessed~~ accessed on February 2, on February 2, ~~2021~~2 021, at , at
https://www.saveourstages.com/abouthttps://www.saveourstages.com/about -us. -us.
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resulted in more than 2.1 resulted in more than 2.1 ~~million~~ mil ion emails being sent to “elected officials expressing their support emails being sent to “elected officials expressing their support
for the Save Our Stages Act.”8 In addition, at a December 15, 2020, Senate congressional hearing for the Save Our Stages Act.”8 In addition, at a December 15, 2020, Senate congressional hearing
on the on the ~~bill,~~ bil , several organizations’ representatives argued that the live events industry had suffered several organizations’ representatives argued that the live events industry had suffered
major economic losses due to the COVID-19 pandemic, with many venues having no income for major economic losses due to the COVID-19 pandemic, with many venues having no income for
many months, and that the prognosis for the industry’s economic future was bleak. They also many months, and that the prognosis for the industry’s economic future was bleak. They also
argued that eligibilityargued that eligibility for the additional relief that the Save Our Stages Act would provide should for the additional relief that the Save Our Stages Act would provide should
be expanded. As one witness testified, be expanded. As one witness testified,
Save Our Stages Save Our Stages only providesonly provides ~~funding~~ funding for venues,for venues, ~~managers, booking agents and~~
~~promotors. This is 8% of the Live Events Industry. All other segments of the~~ managers, booking agents and promotors. This is 8% of the Live Events Industry. All other segments of the industry industry
receive no support via Save Our Stages. Here is a partial list of companies and people receive no support via Save Our Stages. Here is a partial list of companies and people ~~still~~
stil in needin need of of funding:funding: Artists,Artists, Actors,Actors, Performers,Performers, Sound,Sound, Lighting,Lighting, Video,Video, Pyrotechnics, Pyrotechnics,
Lasers,Lasers, Caterers,Caterers, Rigging,Rigging, Trucking,Trucking, Bussing,Bussing, Staging,Staging, Wardrobe,Wardrobe, Designers,Designers, Dancers, Dancers,
Opera, Theaters, Festivals, Tours, Orchestras, Corporate Shows, Trade Shows, Opera, Theaters, Festivals, Tours, Orchestras, Corporate Shows, Trade Shows,
Conventions, Speakers, TV Studios and Stations, Radio Stations, Film, Theme Parks and Conventions, Speakers, TV Studios and Stations, Radio Stations, Film, Theme Parks and
attractions, Museums, Movie Theaters, Labor Companies, Free Lance workers, Circuses, attractions, Museums, Movie Theaters, Labor Companies, Free Lance workers, Circuses,
Fairs, Rodeos, Water Shows, Freight, Drapes, Power, Radios, Manufacturers, andFairs, Rodeos, Water Shows, Freight, Drapes, Power, Radios, Manufacturers, and many many
others. We urge you to pass Save Our Stages, but to also save the rest of the Live Events others. We urge you to pass Save Our Stages, but to also save the rest of the Live Events
Industry. All these industries need one another to survive. Venues will have no artists to Industry. All these industries need one another to survive. Venues will have no artists to
play in them or people to staff the events without holistic industry funding. Please Save All play in them or people to staff the events without holistic industry funding. Please Save All
Live Events.9 Live Events.9
A revised version of the Save Our Stages Act was added to the FY2021 Consolidated A revised version of the Save Our Stages Act was added to the FY2021 Consolidated
Appropriations Act (P.L. 116-260) during congressional negotiations on the act’s final Appropriations Act (P.L. 116-260) during congressional negotiations on the act’s final
provisions.10 The revised version included additional funding (from $12 provisions.10 The revised version included additional funding (from $12 ~~billion~~bil ion to $15 to $15 ~~billion)~~
bil ion) and expanded eligibilityand expanded eligibility to other industry segments. The act included language targeting the to other industry segments. The act included language targeting the
grants to grants to ~~smaller~~smal er entities with revenue losses. entities with revenue losses.
Eligibility Requirements
EligibleEligible applicants include applicants include
 live venue operators or promoters;  live venue operators or promoters;
 theatrical producers;  theatrical producers;
 live performing arts organization operators;  live performing arts organization operators;
 relevant museum operators, including zoos and aquariums, who meet specific  relevant museum operators, including zoos and aquariums, who meet specific
criteria; criteria;
 motion picture theater operators;  motion picture theater operators;

~~8 NIVA, “Save Our Stages Act Has Passed~~ 8 NIVA, “ Save Our Stages Act Has Passed as Part of the COVID-19 Relief Bill,”as Part of the COVID-19 Relief Bill,” at https://www.saveourstages.com/; at https://www.saveourstages.com/;
Jon Blistein, “Jon Blistein, “ Save Our Stages:Save Our Stages: ~~How~~ How an Industry Hail Mary Became Live Music’san Industry Hail Mary Became Live Music’s $15 Billion Lifeline,” $15 Billion Lifeline,” Rolling Stone, ,
December 22, 2020, at https://www.rollingstone.com/music/music-features/live-music-save-our-stages-relief-1107081/; December 22, 2020, at https://www.rollingstone.com/music/music-features/live-music-save-our-stages-relief-1107081/;
and Dave Brooks, “and Dave Brooks, “ Save OurSave Our ~~Stages~~ Stages Passes With StimulusPasses With Stimulus Package: Where Package: Where ~~That~~T hat $15B Is Going, What It Means for $15B Is Going, What It Means for
Live Music,”Live Music,” billboard, December 22, 2020, at https://www.billboard.com/articles/business/touring/9503986/save-our-, December 22, 2020, at https://www.billboard.com/articles/business/touring/9503986/save-our-
stages-stimulus-package-15-billion/. stages-stimulus-package-15-billion/.
~~9 Testimony~~9 T estimony of Michael Strickland, owner Bandit Lites, U.S. of Michael Strickland, owner Bandit Lites, U.S. Congress,Congress, Senate Committee on Commerce, Science, and Senate Committee on Commerce, Science, and
~~Transportation~~T ransportation, Subcommittee on Manufacturing, , Subcommittee on Manufacturing, ~~Trade~~T rade, and Consumer Protection, , and Consumer Protection, ~~Examining the Impact~~Exam ining the Im pact of COVID-
19 on the Live Event ~~Entertainment~~Entertainm ent Industry, hearing on S., hearing on S. 4258, 116th Cong., 2nd sess., December 15, 2020. 4258, 116th Cong., 2nd sess., December 15, 2020.
10 Jem Aswad, 10 Jem Aswad, “Senator Amy Klobuchar Explains $15 billion Save“Senator Amy Klobuchar Explains $15 billion Save Our StagesOur Stages Act,” Act,” Chicago Tribune, December 21, , December 21,
2020, at https://www.chicagotribune.com/entertainment/ct-ent-amy-klobuchar-save-our-stages-act-20201221-2020, at https://www.chicagotribune.com/entertainment/ct-ent-amy-klobuchar-save-our-stages-act-20201221-
jpvwthm3tvabnonqtrhx3crr54-story.html. jpvwthm3tvabnonqtrhx3crr54-story.html.
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 talent representatives; and  talent representatives; and
 subsidiary businesses of eligible entities that also meet the eligibility  subsidiary businesses of eligible entities that also meet the eligibility
requirements on their own rights.11 requirements on their own rights.11
In addition, applicants must In addition, applicants must ~~generally~~general y
 be located in, and primarily operate within, the United  be located in, and primarily operate within, the United States; States;
 make a significant contribution to the United States’ economy through the  make a significant contribution to the United States’ economy through the
payment of taxes or the use of American products, materials or labor; payment of taxes or the use of American products, materials or labor;
 have been in operation as of February 29, 2020;  have been in operation as of February 29, 2020;
 have not received a PPP loan on or after December 27, 2020;  have not received a PPP loan on or after December 27, 2020;
 not be a publicly traded corporation, or majority owned and controlled by a  not be a publicly traded corporation, or majority owned and controlled by a
publicly traded corporation; publicly traded corporation;
 not present live performances or  not present live performances or ~~sell~~ sel products of a prurient sexual nature; products of a prurient sexual nature;
 not have more than 10% of their 2019 gross revenue from the federal government  not have more than 10% of their 2019 gross revenue from the federal government
(not counting disaster assistance); (not counting disaster assistance);
 have a reduction of at least 25% in gross earned revenue during (at least) one  have a reduction of at least 25% in gross earned revenue during (at least) one
quarter of 2020 as compared to the corresponding quarter of 2019; and quarter of 2020 as compared to the corresponding quarter of 2019; and
 certify that the uncertainty of current economic conditions makes necessary the  certify that the uncertainty of current economic conditions makes necessary the
grant to support ongoing operations. grant to support ongoing operations.
As As ~~will~~ wil be discussed, additional eligibilitybe discussed, additional eligibility requirements also exist for specific types of individuals requirements also exist for specific types of individuals
and entities. and entities.
Furthermore, an applicable entity cannot be owned or controlled by a parent entity with Furthermore, an applicable entity cannot be owned or controlled by a parent entity with more
than two of the following characteristics:12 of the following characteristics:12
 owning or operating venues, relevant museums, motion picture theatres, or talent  owning or operating venues, relevant museums, motion picture theatres, or talent
agencies or talent management companies in more than one country; agencies or talent management companies in more than one country;
 owning or operating venues, relevant museums, motion picture theaters, or talent  owning or operating venues, relevant museums, motion picture theaters, or talent
agencies or talent management companies in more than 10 states; or agencies or talent management companies in more than 10 states; or
 having more than 500 full-time equivalent employees (not counting employees  having more than 500 full-time equivalent employees (not counting employees
working fewer than 10 hours per week) as of February 29, 2020.13 working fewer than 10 hours per week) as of February 29, 2020.13

~~11 SBA, “Shuttered Venue Operators Grant~~ 11 SBA, “ Shuttered Venue Operators Grant ,” at https://www.sba.gov/funding-programs/loans/coronavirus-relief-,” at https://www.sba.gov/funding-programs/loans/coronavirus-relief-
options/shuttered-venue-operators-grantoptions/shuttered-venue-operators-grant . .
For entities with multiple subsidiaries, For entities with multiple subsidiaries, the parent entity must meet the eligibility criteria, but each subsidiarythe parent entity must meet the eligibility criteria, but each subsidiary ~~does~~ does not not
need to meet the criteria independently. A maximum of five businessneed to meet the criteria independently. A maximum of five business affiliates can receive a grant (six grants in all). In affiliates can receive a grant (six grants in all). In
addition, an eligibleaddition, an eligible museum,museum, and all of its subsidiaryand all of its subsidiary museums,museums, may receive no more than $10 million combined under may receive no more than $10 million combined under
the program. the program.
If a subsidiary If a subsidiary wants to apply for its own grant, it must meet the eligibility requirements. Subsidiarieswants to apply for its own grant, it must meet the eligibility requirements. Subsidiaries that qualify for that qualify for
grants on their own are not treated as affiliates of their parent entities or one another. grants on their own are not treated as affiliates of their parent entities or one another.
12 In determining ownership and control, the SBA’s affiliation rules generally apply to the Shuttered Venue 12 In determining ownership and control, the SBA’s affiliation rules generally apply to the Shuttered Venue Operators Operators
Grant (SVOG)Grant (SVOG) program. Seeprogram. See 13 C.F.R.13 C.F.R. §121.301(f). P.L. 116-260 provides for a modified application of the affiliation §121.301(f). P.L. 116-260 provides for a modified application of the affiliation
rulesrules to the SVOG.to the SVOG. One example is that a parent could employ more than 500 employees (possibly excludingOne example is that a parent could employ more than 500 employees (possibly excluding it from it from
beingbeing “small” under the SBA’s“small” under the SBA’s size standards) but still receive an SVOGsize standards) but still receive an SVOG as long as it doesas long as it does not operate in more than 1 not operate in more than 1
country or 10 states. Another exception to the general affiliation rules is explained in thecountry or 10 states. Another exception to the general affiliation rules is explained in the “ “ Initial Grant Amount ”” of this of this
report. report.
13 Based13 Based on P.L. 116-260, full-time equivalent employees are determined according to the following rules:on P.L. 116-260, full-time equivalent employees are determined according to the following rules: (1) any (1) any
employee working at leastemployee working at least 30 hours per week30 hours per week is counted as a full-time employee; (2) any employee working at least 10 is counted as a full-time employee; (2) any employee working at least 10
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Live Venue Operator or Promoters, Theatrical Producers, and Live
Performing Arts Organization Operators
In addition to the program’s general eligibilityIn addition to the program’s general eligibility criteria, a live venue operator or promoter, criteria, a live venue operator or promoter,
theatrical producer, or live performing arts organization operator, which may be for-profit, theatrical producer, or live performing arts organization operator, which may be for-profit,
nonprofit, or publicly owned and operated, must nonprofit, or publicly owned and operated, must
 be, or intend to be, organizing, promoting, producing, managing, or hosting  be, or intend to be, organizing, promoting, producing, managing, or hosting
future live concerts, comedy shows, or theatrical productions or other events by future live concerts, comedy shows, or theatrical productions or other events by
performing artists as their principal business activity; performing artists as their principal business activity;
 have a defined performance and audience space, mixing equipment, a public  have a defined performance and audience space, mixing equipment, a public
address system, and a lighting rig; address system, and a lighting rig;
 engage one or more individuals to carry out not less than two of the following  engage one or more individuals to carry out not less than two of the following
roles: sound engineer, a booker, a promoter, a stage manager, security personnel, roles: sound engineer, a booker, a promoter, a stage manager, security personnel,
and a box office manager; and a box office manager;
 have a paid ticket or cover charge to attend most performances and paid artists  have a paid ticket or cover charge to attend most performances and paid artists
who do not play for free or solely for tips, except for fundraisers or similar who do not play for free or solely for tips, except for fundraisers or similar
charitable events. The performers must be paid in an amount that is based on a charitable events. The performers must be paid in an amount that is based on a
percentage of sales, a guarantee (in writing or standard contract), or another percentage of sales, a guarantee (in writing or standard contract), or another
~~mutually~~mutual y beneficial formal agreement. Venues owned or operated by nonprofit beneficial formal agreement. Venues owned or operated by nonprofit
entities that produce free events must be produced and managed primarily by entities that produce free events must be produced and managed primarily by
paid employees, not volunteers; paid employees, not volunteers;
 generate at least 70% of revenue through cover charges or ticket sales, production  generate at least 70% of revenue through cover charges or ticket sales, production
fees or reimbursements, nonprofit educational initiatives, or the sale of event fees or reimbursements, nonprofit educational initiatives, or the sale of event
beverages, food, or merchandise; or beverages, food, or merchandise; or
 make tickets available  make tickets available for purchase by the public an average of not less than 60 for purchase by the public an average of not less than 60
days in advance of the live concerts, comedy shows, theatrical productions, or days in advance of the live concerts, comedy shows, theatrical productions, or
other qualifying events and have performers who are paid in an amount that is other qualifying events and have performers who are paid in an amount that is
based on a percentage of sales, a guarantee, or another based on a percentage of sales, a guarantee, or another ~~mutually~~mutual y beneficial formal beneficial formal
agreement.agreement.
Relevant Museum Operators, including Zoos and Aquariums
In addition to the program’s general eligibilityIn addition to the program’s general eligibility requirements, relevant museum operators, which requirements, relevant museum operators, which
include aquariums, arboretums, botanical gardens, art museums, children’s museums, general include aquariums, arboretums, botanical gardens, art museums, children’s museums, general
museums, historic houses and sites, history museums, nature centers, natural history and museums, historic houses and sites, history museums, nature centers, natural history and
anthropology museums, planetariums, science and technology centers, specialized museums, and anthropology museums, planetariums, science and technology centers, specialized museums, and
zoological parks (see 20 U.S.C. §9172), must zoological parks (see 20 U.S.C. §9172), must

hours and fewer than 30 hours per week is counted as one-half of a full-time employee; and (3) any employee working hours and fewer than 30 hours per week is counted as one-half of a full-time employee; and (3) any employee working
fewer than 10 hours per week are not counted as an employee. Also, in determining employment, subsidiary entities fewer than 10 hours per week are not counted as an employee. Also, in determining employment, subsidiary entities
that otherwise qualify for grants are not treated as affiliates of their parent entities, or one another. that otherwise qualify for grants are not treated as affiliates of their parent entities, or one another. ~~The~~T he SBA has SBA has
indicated that once the qualifying employees are determined, the applicant calculates the average number of employees indicated that once the qualifying employees are determined, the applicant calculates the average number of employees
over the prior year in each individualover the prior year in each individual pay period and dividespay period and divides that amount by the number of pay periods in the year to that amount by the number of pay periods in the year to
determine if its average number of full-time equivalent employees is 500 or fewer. determine if its average number of full-time equivalent employees is 500 or fewer.
For rolling guidanceFor rolling guidance on eligibility criteria, see SBA,on eligibility criteria, see SBA, “ “Shuttered VenueShuttered Venue Operators Grants – FAQ,” accessedOperators Grants – FAQ,” accessed February February
16, 2021, at https://www.sba.gov/document/support16, 2021, at https://www.sba.gov/document/support -shuttered-venue-operators-grants-faq?utm_medium=email&-shuttered-venue-operators-grants-faq?utm_medium=email&
utm_source=govdelivery. utm_source=govdelivery.
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 operate as a public, tribal, or private nonprofit agency or institution organized on  operate as a public, tribal, or private nonprofit agency or institution organized on
a permanent basis for a permanent basis for ~~essentially~~essential y educational, cultural heritage, or aesthetic educational, cultural heritage, or aesthetic
purposes; have a professional staff; own or utilize tangible objects, care for the purposes; have a professional staff; own or utilize tangible objects, care for the
tangible objects, and exhibit the tangible objects to the public on a regular basis; tangible objects, and exhibit the tangible objects to the public on a regular basis;
 be open or intend to reopen;  be open or intend to reopen;
 serve as a relevant museum as its principal business activity;  serve as a relevant museum as its principal business activity;
 have indoor exhibition spaces that are a component of the principal business  have indoor exhibition spaces that are a component of the principal business
activity and have been subjected to pandemic-related occupancy restrictions; and activity and have been subjected to pandemic-related occupancy restrictions; and
 have at least one auditorium, theater, or performance or lecture  have at least one auditorium, theater, or performance or lecture ~~hall~~ hal with fixed with fixed
seating and regular programming. seating and regular programming.
Motion Picture Theatre Operators
In addition to the program’s general eligibilityIn addition to the program’s general eligibility requirements, a motion picture theater operator, requirements, a motion picture theater operator,
which may be for-profit, nonprofit, or government-owned, must which may be for-profit, nonprofit, or government-owned, must
 have as its principal business activity the ownership or operation of at least one  have as its principal business activity the ownership or operation of at least one
place of public accommodation for the purpose of showing movies for a fee; place of public accommodation for the purpose of showing movies for a fee;
 be open or intend to reopen for the primary purpose of publicly exhibiting motion  be open or intend to reopen for the primary purpose of publicly exhibiting motion
pictures; pictures;
 have at least one auditorium that includes a motion picture screen and fixed  have at least one auditorium that includes a motion picture screen and fixed
audience seating, a projection booth or space containing at least one motion audience seating, a projection booth or space containing at least one motion
picture projector, and a paid ticket charge; and picture projector, and a paid ticket charge; and
 market motion pictures through show-time listings in printed or electronic  market motion pictures through show-time listings in printed or electronic
publications, on websites, by mass mail, or on social media. publications, on websites, by mass mail, or on social media.
Talent Representatives
In addition to the program’s general eligibilityIn addition to the program’s general eligibility requirements, a talent representative (i.e., a requirements, a talent representative (i.e., a
corporation, limited liabilitycorporation, limited liability company, partnership, or sole proprietorship serving as an agent or company, partnership, or sole proprietorship serving as an agent or
manager for artists and entertainers) may be for-profit, nonprofit, or publicly owned and operated, manager for artists and entertainers) may be for-profit, nonprofit, or publicly owned and operated,
and must and must
 be representing or managing artists and entertainers;  be representing or managing artists and entertainers;
 have at least 70% of its operations involved in representing or managing artists  have at least 70% of its operations involved in representing or managing artists
and entertainers; and entertainers;
 book or represent musicians, comedians, actors, or similar performing artists  book or represent musicians, comedians, actors, or similar performing artists
primarily at live events in venues or at festivals; and primarily at live events in venues or at festivals; and
 represent performers that are paid in an amount that is based on the number of  represent performers that are paid in an amount that is based on the number of
tickets sold, or a similar basis (e.g., entrance fees). tickets sold, or a similar basis (e.g., entrance fees).
Grant Amounts
The SVOG program awards initial and, if funding is available, supplemental grants. The SVOG program awards initial and, if funding is available, supplemental grants.
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Initial Grant Amount
EligibleEligible entities that were in operation on January 1, 2019, receive an initial grant equal to 45% of entities that were in operation on January 1, 2019, receive an initial grant equal to 45% of
their 2019 gross earned revenue, or $10 their 2019 gross earned revenue, or $10 ~~million~~mil ion, whichever is less.14 , whichever is less.14
Eligible Eligible entities that began operations after January 1, 2019, receive an initial grant equal to the entities that began operations after January 1, 2019, receive an initial grant equal to the
entity’s average monthly gross revenue for each full month it was in operation during 2019 entity’s average monthly gross revenue for each full month it was in operation during 2019
~~multiplied~~ multiplied by six, or $10 by six, or $10 ~~million,~~ mil ion, whichever is less. whichever is less.
A relevant museum operator may not receive grants in excess of $10 A relevant museum operator may not receive grants in excess of $10 ~~million for all~~ mil ion for al relevant relevant
museums operated by the operator. Pursuant to the program’s affiliation rules, an applicant, museums operated by the operator. Pursuant to the program’s affiliation rules, an applicant,
together with its affiliates, cannot collectively receive more than $60 together with its affiliates, cannot collectively receive more than $60 ~~million~~ mil ion in grants. in grants.
Supplemental Grant Amount
A supplemental grant equals 50% of the initialA supplemental grant equals 50% of the initial grant (subject to the total $10 grant (subject to the total $10 ~~million cap on all~~
mil ion cap on al SOVG grants received by the recipient). SOVG grants received by the recipient).
The SBA may not award a supplemental grant until The SBA may not award a supplemental grant until ~~all~~ al applications for initialapplications for initial grants submitted grants submitted
within the program’s first 60 days have been processed. within the program’s first 60 days have been processed.
Individuals or entities that received an initial Individuals or entities that received an initial grant may receive a supplemental grant if, as of grant may receive a supplemental grant if, as of
April 1, 2021, the individuals’ or entities’ revenue (not including amounts received under the April 1, 2021, the individuals’ or entities’ revenue (not including amounts received under the
CARES Act and its amendments) for the most recent quarter (first quarter of 2021) is not more CARES Act and its amendments) for the most recent quarter (first quarter of 2021) is not more
than 30% of the revenue for the corresponding quarter in 2019 (first quarter of 2019). than 30% of the revenue for the corresponding quarter in 2019 (first quarter of 2019).
The SBA is authorized to establish alternative methods to calculate revenue losses for seasonal The SBA is authorized to establish alternative methods to calculate revenue losses for seasonal
employers that would be adversely affected if January, February, and March are excluded from employers that would be adversely affected if January, February, and March are excluded from
the calculation of year-over-year revenue. the calculation of year-over-year revenue.
Prioritization of Grant Disbursements
P.L. 116-260 requires the SBA to prioritize the awarding of initialP.L. 116-260 requires the SBA to prioritize the awarding of initial grants in the following manner: grants in the following manner:
First Priority Period—During the first 14 days of the program accepting applications, the SBA —During the first 14 days of the program accepting applications, the SBA
may only award grants to otherwise eligible applicants that have experienced a 90% or greater may only award grants to otherwise eligible applicants that have experienced a 90% or greater
revenue loss during the period beginning on April 1, 2020, through December 31, 2020, revenue loss during the period beginning on April 1, 2020, through December 31, 2020,
compared with the applicant’s revenue during the same period in 2019 due to the COVID-19 compared with the applicant’s revenue during the same period in 2019 due to the COVID-19
pandemic. pandemic.
Second Priority Period—During the next 14 days of the program, the SBA may only award —During the next 14 days of the program, the SBA may only award
grants to otherwise eligible applicants that have experienced a 70% or greater revenue loss during grants to otherwise eligible applicants that have experienced a 70% or greater revenue loss during
the period beginning on Aprilthe period beginning on April 1, 2020, through December 31, 2020, compared with the 1, 2020, through December 31, 2020, compared with the
applicant’s revenue during the same period in 2019 due to the COVID-19 pandemic. applicant’s revenue during the same period in 2019 due to the COVID-19 pandemic.
The SBA may award up to 80% ($12 The SBA may award up to 80% ($12 ~~billion~~bil ion) of the SVOG program’s funds during this 28-day ) of the SVOG program’s funds during this 28-day
priority period. priority period.

~~14 The SBA~~ 14 T he SBA counts only fundscounts only funds received from the sale of goodsreceived from the sale of goods or services as earned revenue. Revenueor services as earned revenue. Revenue from other fund from other fund
sources, suchsources, such as donations, sponsorships, governmental assistance, or returns on investments are not counted. as donations, sponsorships, governmental assistance, or returns on investments are not counted. ~~Gross~~Gros s
earned revenue isearned revenue is the total of earned revenue from the various sales of goodsthe total of earned revenue from the various sales of goods and services, such asand services, such as admission tickets, admission tickets,
merchandise, food and beverages,merchandise, food and beverages, advertising sales,advertising sales, and contracted presentation income. See SBA,and contracted presentation income. See SBA, “ “Shuttered Venue Shuttered Venue
Operators Grants – FAQ,”Operators Grants – FAQ,” January 27, 2021, at https://www.sba.gov/document/supportJanuary 27, 2021, at https://www.sba.gov/document/support -shuttered-venue-operators--shuttered-venue-operators-
grants-faq?utm_medium=email&utm_source=govdelivery. grants-faq?utm_medium=email&utm_source=govdelivery.
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Third Priority Period—Thereafter, initial grants of remaining funds can be made to —Thereafter, initial grants of remaining funds can be made to ~~all~~ al other other
eligibleeligible applicants (entities that have experienced a 25% or greater revenue loss between one applicants (entities that have experienced a 25% or greater revenue loss between one
quarter of 2019 and the corresponding quarter in 2020 due to the COVID-19 pandemic).quarter of 2019 and the corresponding quarter in 2020 due to the COVID-19 pandemic).
As mentioned, the SBA may not award a supplemental grant until As mentioned, the SBA may not award a supplemental grant until ~~all~~ al applications for initial applications for initial
grants submitted within the program’s first 60 days have been processed. In addition, the SBA is grants submitted within the program’s first 60 days have been processed. In addition, the SBA is
required to reserve no less than $2 required to reserve no less than $2 ~~billion~~ bil ion of appropriated funds during the first 59 days of the of appropriated funds during the first 59 days of the
opening of the SVOG program for grants to entities with 50 or fewer full-time equivalent opening of the SVOG program for grants to entities with 50 or fewer full-time equivalent
employees.employees.
Use of Grant Funds
The initialThe initial grant award may be used for eligible expenses incurred during the period beginning on grant award may be used for eligible expenses incurred during the period beginning on
March 1, 2020, through December 31, 2021. Supplemental grants may be used for eligible March 1, 2020, through December 31, 2021. Supplemental grants may be used for eligible
expenses incurred during the period beginning on March 1, 2020, through June 30, 2022. expenses incurred during the period beginning on March 1, 2020, through June 30, 2022.
Any initial Any initial grant proceeds that are not spent (on grant proceeds that are not spent (on ~~allowable~~al owable expenses) within one year and any expenses) within one year and any
supplemental grant proceeds not spent within 18 months of disbursement must be returned to the supplemental grant proceeds not spent within 18 months of disbursement must be returned to the
SBA. SBA.
Grant funds may be used for the following expenses: Grant funds may be used for the following expenses:
 payroll costs;  payroll costs;
 rent payments;  rent payments;
 utility payments;  utility payments;
 scheduled mortgage payments (not including the prepayment of principal);  scheduled mortgage payments (not including the prepayment of principal);
 scheduled debt payments (not including the prepayment of principal) on any  scheduled debt payments (not including the prepayment of principal) on any
indebtedness incurred in the ordinary course of business prior to February 15, indebtedness incurred in the ordinary course of business prior to February 15,
2020; 2020;
 worker protection expenditures;  worker protection expenditures;
 payments to independent contractors (not to exceed $100,00 in annual  payments to independent contractors (not to exceed $100,00 in annual
compensation per independent contractor); compensation per independent contractor);
 other ordinary and necessary business expenses, including maintenance costs,  other ordinary and necessary business expenses, including maintenance costs,
administrative costs (including fees and licensing costs); state and local taxes and administrative costs (including fees and licensing costs); state and local taxes and
licensing fees; operating leases in effect as of February 15, 2020, and insurance licensing fees; operating leases in effect as of February 15, 2020, and insurance
payments; and payments; and
 advertising, production transportation, and capital expenditures related to  advertising, production transportation, and capital expenditures related to
producing a theatrical or live performing arts production, concert, exhibition, or producing a theatrical or live performing arts production, concert, exhibition, or
comedy show.15 comedy show.15
Grant funds may not be used to Grant funds may not be used to
 purchase real estate;  purchase real estate;
 make payments on loans originated after February 15, 2020;  make payments on loans originated after February 15, 2020;
 make investments or loans;  make investments or loans;

15 P.L. 116-260 specifies that grant proceeds cannot15 P.L. 116-260 specifies that grant proceeds cannot be usedbe used primarily for advertising, production transportation, and primarily for advertising, production transportation, and
capital expenditures related to producing a theatrical or live performing arts productioncapital expenditures related to producing a theatrical or live performing arts production , concert, exhibition, or comedy , concert, exhibition, or comedy
show. show.
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 make contributions or other payments to, or on behalf of, political parties,  make contributions or other payments to, or on behalf of, political parties,
political committees, or candidates for elective office; or political committees, or candidates for elective office; or
 cover any other expenditure prohibited by the SBA Administrator.16  cover any other expenditure prohibited by the SBA Administrator.16
Initial Program Rollout
The SBA has a long history of providing grants to marketing, management, and technical The SBA has a long history of providing grants to marketing, management, and technical
assistance training providers (e.g., assistance training providers (e.g., ~~Small~~ Smal Business Development Centers, Women Business Business Development Centers, Women Business
Centers, SCORE, Microloan intermediaries), and, in recent years, with state governments through Centers, SCORE, Microloan intermediaries), and, in recent years, with state governments through
the State Trade Expansion Program.17 The SBA does not have directly comparable experience the State Trade Expansion Program.17 The SBA does not have directly comparable experience
administering grants to for-profit businesses. As such, the agency does not have as many administering grants to for-profit businesses. As such, the agency does not have as many
analogous programs or precedents to expedite the development of the SVOG program. analogous programs or precedents to expedite the development of the SVOG program.
P.L. 116-260 was signed into law on December 27, 2020. The act did not specify a deadline for P.L. 116-260 was signed into law on December 27, 2020. The act did not specify a deadline for
the SBAthe SBA to implement the SVOG program, which the SBA to implement the SVOG program, which the SBA ~~typically~~typical y does through the publication does through the publication
of regulations in the of regulations in the Federal Register and the release of SBA guidance or procedural notices on and the release of SBA guidance or procedural notices on
the SBAthe SBA website. website.
However, other statutorily required deadlines suggested that Congress expected the SBA to However, other statutorily required deadlines suggested that Congress expected the SBA to
implement the SVOG program expeditiously. For example, the SBA was given until February 10, implement the SVOG program expeditiously. For example, the SBA was given until February 10,
2021 (45 days from the date of enactment) to submit an oversight and audit plan to the House 2021 (45 days from the date of enactment) to submit an oversight and audit plan to the House
Committee on Committee on ~~Small~~ Smal Business and Senate Committee on Business and Senate Committee on ~~Small~~ Smal Business and Entrepreneurship Business and Entrepreneurship
“that details—(A) the policies and procedures of the Administrator for conducting oversight and “that details—(A) the policies and procedures of the Administrator for conducting oversight and
audits of grants under this section; and (B) the metrics that the Administrator audits of grants under this section; and (B) the metrics that the Administrator ~~shall~~ shal use to use to
determine which grants determine which grants ~~will~~ wil be audited.” be audited.”
The act also specified that the SBA The act also specified that the SBA was to provide to the House and Senate Committees on was to provide to the House and Senate Committees on ~~Small~~
Smal Business, not later than February 25, 2021 (60 days after the date of enactment), the first of a Business, not later than February 25, 2021 (60 days after the date of enactment), the first of a
series of monthly oversight and audit reports of the initial grants approved and disbursed. series of monthly oversight and audit reports of the initial grants approved and disbursed.
Soon after P.L. 116-260’s enactment, the SBA created a SVOG program web page, providing a Soon after P.L. 116-260’s enactment, the SBA created a SVOG program web page, providing a
brief overview of the program’s details (when enacted, available funding, and a link to frequently brief overview of the program’s details (when enacted, available funding, and a link to frequently
asked questions), program eligibility, formulas for determining SVOG initialasked questions), program eligibility, formulas for determining SVOG initial and supplemental and supplemental
grant amounts, application instructions (grant amounts, application instructions (~~initially~~ initial y just a table indicating how grant awards were to just a table indicating how grant awards were to
be prioritized because the application portal was not yet available), and be prioritized because the application portal was not yet available), and ~~allowable~~al owable uses for the uses for the
funds.18funds.18
Recognizing that venue operators were anxious for the program to begin and eager to learn if they Recognizing that venue operators were anxious for the program to begin and eager to learn if they
would qualify for assistance, on January 14, 2021, the SBA held an informational webinar on the would qualify for assistance, on January 14, 2021, the SBA held an informational webinar on the

~~16 The SBA~~ 16 T he SBA has not prohibited any other uses to date. has not prohibited any other uses to date.
17 In addition, the SBA17 In addition, the SBA is authorized to provide grants to states to contract with small businessesis authorized to provide grants to states to contract with small businesses to plant trees. to plant trees. ~~The~~T he
program wasprogram was operational during the 1990s. See P.L. 101-515, the Departments of Commerce, Justice, and State, the operational during the 1990s. See P.L. 101-515, the Departments of Commerce, Justice, and State, the
Judiciary,Judiciary, and Related Agenciesand Related Agencies Appropriations Act, 1991Appropriations Act, 1991 . .
For additional information and analysis concerning the SBA’sFor additional information and analysis concerning the SBA’s management and technical assistance training programs, management and technical assistance training programs,
see CRSsee CRS Report R41352, Report R41352, ~~Small Business Management~~Sm all Business Managem ent and Technical Assistance Training ~~Programs~~Program s, by Robert Jay , by Robert Jay
Dilger. For additional information and analysis concerning the SBA’sDilger. For additional information and analysis concerning the SBA’s trade and export promotion programs, see CRS trade and export promotion programs, see CRS
Report R43155, Report R43155, ~~Small Business Administration Trade and Export Promotion Programs~~Sm all Business Adm inistration Trade and Export Prom otion Program s, by Sean Lowry. , by Sean Lowry.
18 18 ~~The~~T he frequently asked questions document was frequently asked questions document was ~~updated~~ updated on January 27, 2021, and February 5, 2021. Seeon January 27, 2021, and February 5, 2021. See SBA, SBA,
“Shuttered Venue“Shuttered Venue Operators Grants – FAQ,” January 27, 2021, at https://www.sba.gov/document/support-shuttered-Operators Grants – FAQ,” January 27, 2021, at https://www.sba.gov/document/support-shuttered-
venue-operators-grants-faq?utm_medium=email&utm_source=govdelivery. venue-operators-grants-faq?utm_medium=email&utm_source=govdelivery.
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SVOG program.19 The webinar provided introductory information about the SVOG program, who SVOG program.19 The webinar provided introductory information about the SVOG program, who
can apply, how potential organizations can prepare, and additional details concerning program can apply, how potential organizations can prepare, and additional details concerning program
eligibilityeligibility and the application process.20 A second informational webinar, provided by the Central and the application process.20 A second informational webinar, provided by the Central
Indiana Indiana ~~Small~~ Smal Business Development Center, was held on February 2, 2021.21 The SBA provided Business Development Center, was held on February 2, 2021.21 The SBA provided
a third informational webinar on the program on March 31, 2021.22a third informational webinar on the program on March 31, 2021.22
The SBA Office of Disaster Assistance expected that it would take some time for the program to The SBA Office of Disaster Assistance expected that it would take some time for the program to
become operational because the SBA’s disaster assistance electronic application processing become operational because the SBA’s disaster assistance electronic application processing
software is configured for loans, not grants. As a result, the SBA has to create new software to software is configured for loans, not grants. As a result, the SBA has to create new software to
process SVOG applications. SBA’s Office of Disaster Assistance had a similar process SVOG applications. SBA’s Office of Disaster Assistance had a similar ~~challenge~~chal enge in in
administering the Emergency Economic Injury Disaster Loan (EIDL) advance payment (grant) administering the Emergency Economic Injury Disaster Loan (EIDL) advance payment (grant)
program (authorized by P.L. 116-136) and the Targeted EIDL advance payment (grant) program program (authorized by P.L. 116-136) and the Targeted EIDL advance payment (grant) program
(authorized by P.L. 116-260). Although both of these programs are (authorized by P.L. 116-260). Although both of these programs are ~~technically still~~ technical y stil a loan, the a loan, the
SBA had to rewrite the software underpinning its disaster assistance electronic portal to account SBA had to rewrite the software underpinning its disaster assistance electronic portal to account
for the programs’ various eligibility requirements and loan (award) amounts. for the programs’ various eligibility requirements and loan (award) amounts.
As the SBA continued to build the SVOG program’s application portal and complete the As the SBA continued to build the SVOG program’s application portal and complete the
program’s regulations and guidance, many venue operators contacted both the SBA and program’s regulations and guidance, many venue operators contacted both the SBA and
congressional offices with questions about program eligibilitycongressional offices with questions about program eligibility and the application acceptance and the application acceptance
date. In response to these questions, some Members of Congress contacted the SBA, urging the date. In response to these questions, some Members of Congress contacted the SBA, urging the
agency to provide eligibilityagency to provide eligibility for specific types of venues. For example, Senators Marco Rubio, for specific types of venues. For example, Senators Marco Rubio,
Jim Risch, and Mitt Romney sent a letter to the SBAJim Risch, and Mitt Romney sent a letter to the SBA on January 16, 2021, urging the agency to on January 16, 2021, urging the agency to
include minor league sports venues in the program.23 The SBA subsequently included in its include minor league sports venues in the program.23 The SBA subsequently included in its
SVOG Frequently Asked Questions (FAQs) document, updated on January 27, 2021, that minor SVOG Frequently Asked Questions (FAQs) document, updated on January 27, 2021, that minor
league sports venues league sports venues ~~generally~~general y would not be eligible would not be eligible because “sports are not a form of performing because “sports are not a form of performing
art.”24 art.”24
On March 5, 2021, the SBA published a preliminary SVOG application checklist on its website to On March 5, 2021, the SBA published a preliminary SVOG application checklist on its website to
help potentialhelp potential applicants identify documentation that applicants identify documentation that ~~will~~ wil be needed once the application portal is be needed once the application portal is

~~19 SBA, “SBA~~ 19 SBA, “ SBA to Host Shuttered Venueto Host Shuttered Venue Operators Grant Webinar on Jan. 14Operators Grant Webinar on Jan. 14 ,” at https://www.sba.gov/article/2021/jan/,” at https://www.sba.gov/article/2021/jan/
12/sba-host12/sba-host -shuttered-venue-operators-grant-webinar-jan-14-0. -shuttered-venue-operators-grant-webinar-jan-14-0.
20 SBA, 20 SBA, “ “Archived Webinar: Shuttered VenueArchived Webinar: Shuttered Venue Operators Grant Overview,” November 14, 2021, at Operators Grant Overview,” November 14, 2021, at
https://www.youtube.com/watch?v=PdfQGb6z-gg. https://www.youtube.com/watch?v=PdfQGb6z-gg.
21 SBA,21 SBA, “ “Shuttered VenueShuttered Venue Operators Grant - Emergency Assistance for EligibleOperators Grant - Emergency Assistance for Eligible ~~Venues~~ Venues Affected by the COVID Affected by the COVID
Pandemic,” February 2, 2021, at https://www.eventbrite.com/e/qa-session-on-the-shuttered-venue-operators-grant-Pandemic,” February 2, 2021, at https://www.eventbrite.com/e/qa-session-on-the-shuttered-venue-operators-grant-
tickets-138490953169?aff=erelexpmlttickets-138490953169?aff=erelexpmlt . .
22 SBA, 22 SBA, “Archived Webinar: Shuttered Venue“Archived Webinar: Shuttered Venue Operators Grant Information Operators Grant Information ~~Session~~Sessio n,” March 31, 2021, at ,” March 31, 2021, at
https://www.youtube.com/watch?v=CNWsgR9ESUs. https://www.youtube.com/watch?v=CNWsgR9ESUs.
23 Sen. Mitt Romney, “Romney Urges SBA23 Sen. Mitt Romney, “Romney Urges SBA to Include Minor Leagueto Include Minor League Sports VenuesSports Venues in Grant Eligibility: Wouldin Grant Eligibility: Would Permit Permit
OgdenOgden Raptors to Receive Grant FundsRaptors to Receive Grant Funds for Lindquistfor Lindquist Field,”Field,” January 16, 2021, atJanuary 16, 2021, at https://www.romney.senate.gov/https://www.romney.senate.gov/
romney-urges-sba-include-minor-league-romney-urges-sba-include-minor-league-~~sports~~sport s-venues-grant-venues-grant -eligibility. -eligibility.
24 24 ~~The~~T he SBA SBA indicated that “indicated that “ while sports are not a form of performing artwhile sports are not a form of performing art , if the operator of a sports stadium or similar , if the operator of a sports stadium or similar
athletic arena can meet the statutory definition of an eligible entity under the Economic Aid Act, includingathletic arena can meet the statutory definition of an eligible entity under the Economic Aid Act, including the the
requirement that its principal businessrequirement that its principal business activity must be the organization, promotion, management, or hosting of live activity must be the organization, promotion, management, or hosting of live
concerts, comedy shows, theatrical productions or other events by performing artists, it should beconcerts, comedy shows, theatrical productions or other events by performing artists, it should be ~~eligible~~ eligible to apply for to apply for
an SVOG.”an SVOG.” ~~See SBA, “~~ See SBA, “ Shuttered VenueShuttered Venue Operators Grants – FAQ,” January 27, 2021, at https://www.sba.gov/Operators Grants – FAQ,” January 27, 2021, at https://www.sba.gov/
document/supportdocument/support -shuttered-venue-operators-grants-faq?utm_medium=email&utm_source=govdelivery. -shuttered-venue-operators-grants-faq?utm_medium=email&utm_source=govdelivery.
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up and running (updated on March 11, 2021).25 The SBA also published on its website on March up and running (updated on March 11, 2021).25 The SBA also published on its website on March
5, 2021, a table summarizing the SVOG’s eligibility5, 2021, a table summarizing the SVOG’s eligibility requirements (updated on March 16, 2021).26requirements (updated on March 16, 2021).26
On March 19, 2021, the SBA announced that it would start accepting SVOG applications on April On March 19, 2021, the SBA announced that it would start accepting SVOG applications on April
8, 2021.27 8, 2021.27 ~~Now that~~However, the application portal experienced technical difficulties, and the portal was shut down. No applications were accepted. The portal remains closed as the SBA works on a fix. Once the application portal is up and running, questions about the technical issues and continuing questions about SVOG program eligibility ~~the application portal is up and running, questions about SVOG program~~
~~eligibility and the inevitable questions about the portal’s ease of use for applicants~~ may shift to may shift to
questions about the portal’s ability to provide information of interest for evaluating the program’s questions about the portal’s ability to provide information of interest for evaluating the program’s
use and efficacy. For example, use and efficacy. For example, ~~will~~ wil this information enable Congress to assess the program’s (1) this information enable Congress to assess the program’s (1)
output performance, as measured by the number and value of the grant awards, average grant output performance, as measured by the number and value of the grant awards, average grant
size, use of funds, and the distribution of grant awards by firm size, demographic characteristics, size, use of funds, and the distribution of grant awards by firm size, demographic characteristics,
or business location; and (2) outcome or business location; and (2) outcome performance, as measured by the number of jobs retained performance, as measured by the number of jobs retained
and created, or recipient survivability. and created, or recipient survivability.
Program Oversight and Reporting Requirements
P.L. 116-260 requires the SBA to increase its oversight of the SVOG program. To assist the P.L. 116-260 requires the SBA to increase its oversight of the SVOG program. To assist the
agency in this effort, grant recipients must retain employment records documenting their agency in this effort, grant recipients must retain employment records documenting their
compliance with the program’s employment requirements for four years after receiving grants. compliance with the program’s employment requirements for four years after receiving grants.
Other records necessary to document compliance with SVOG requirements must be retained for Other records necessary to document compliance with SVOG requirements must be retained for
three years after receiving the grant. The SBA is authorized to review and audit these records, and three years after receiving the grant. The SBA is authorized to review and audit these records, and
in the case of fraud, will require repayment of misspent funds or result in legal action to collect in the case of fraud, will require repayment of misspent funds or result in legal action to collect
the funds. the funds.
In addition, as mentioned, the SBA was given until February 10, 2021 (45 days from the date of In addition, as mentioned, the SBA was given until February 10, 2021 (45 days from the date of
enactment) to submit an oversight and audit plan to the House Committee on enactment) to submit an oversight and audit plan to the House Committee on ~~Small~~ Smal Business and Business and
Senate Committee on Senate Committee on ~~Small~~ Smal Business and Entrepreneurship “that details—(A) the policies and Business and Entrepreneurship “that details—(A) the policies and
procedures of the Administrator for conducting oversight and audits of grants under this section; procedures of the Administrator for conducting oversight and audits of grants under this section;
and (B) the metrics that the Administrator and (B) the metrics that the Administrator ~~shall~~ shal use to determine which grants use to determine which grants ~~will~~ wil be audited.” be audited.”
The act also specified that the SBA The act also specified that the SBA was to provide to the House Committee on was to provide to the House Committee on ~~Small~~ Smal Business Business
and Senate Committee on and Senate Committee on ~~Small~~ Smal Business and Entrepreneurship, not later than February 25, 2021 Business and Entrepreneurship, not later than February 25, 2021
(60 days after the date of enactment) and each month thereafter until one year after the date on (60 days after the date of enactment) and each month thereafter until one year after the date on
which the grant funds have been expended, an oversight and audit report that includes which the grant funds have been expended, an oversight and audit report that includes
 the total number of initial  the total number of initial grants approved and disbursed; grants approved and disbursed;
 the total amount of grants received by each eligible person or entity, including  the total amount of grants received by each eligible person or entity, including
any supplemental grants; any supplemental grants;
 the number of active investigations and audits of grants;  the number of active investigations and audits of grants;
 the number of completed reviews and audits of grants, including a description of  the number of completed reviews and audits of grants, including a description of
any findings of fraud or other material noncompliance; and any findings of fraud or other material noncompliance; and
~~ any substantial changes made to the oversight and audit plan previously~~
~~submitted.~~

~~25 SBA, “Shuttered Venue~~ 25 SBA, “ Shuttered Venue Operators Grant Preliminary Application ChecklistOperators Grant Preliminary Application Checklist ,” at https://www.sba.gov/document/,” at https://www.sba.gov/document/
supportsupport -shuttered-venue-operators-grant-preliminary-application-checklist. -shuttered-venue-operators-grant-preliminary-application-checklist.
26 SBA, 26 SBA, “ “Shuttered VenueShuttered Venue Operators Grant Eligibility Requirements,”Operators Grant Eligibility Requirements,” at https://www.sba.gov/document/support-at https://www.sba.gov/document/support-
shuttered-venue-operators-grant-eligibility-requirements. shuttered-venue-operators-grant-eligibility-requirements.
27 SBA, 27 SBA, ~~“SBA~~ “ SBA Launches Portal to Begin Accepting Shuttered VenueLaunches Portal to Begin Accepting Shuttered Venue Operators Grant Applications on April 8 National Operators Grant Applications on April 8 National
informational webinar to review application process on March 30informational webinar to review application process on March 30 ,” March 19, 2021. ,” March 19, 2021.
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 any substantial changes made to the oversight and audit plan previously submitted. In a related development, on April 7, 2021, the SBA’s Office of Inspector General (OIG) issued a In a related development, on April 7, 2021, the SBA’s Office of Inspector General (OIG) issued a
management alert indicating “serious concerns with the control environment and the tracking of management alert indicating “serious concerns with the control environment and the tracking of
performance results in the Shuttered Venue Operators Grant (SVOG) requiring immediate performance results in the Shuttered Venue Operators Grant (SVOG) requiring immediate
attention and action.”28 The OIG indicated that the SBA had decided to take into account an attention and action.”28 The OIG indicated that the SBA had decided to take into account an
assessment of the applicant’s level of risk (low, moderate, and high)29 and the award amount to assessment of the applicant’s level of risk (low, moderate, and high)29 and the award amount to
determine the SVOG award payment schedule (from 1 to 4 payments) and the likelihood of the determine the SVOG award payment schedule (from 1 to 4 payments) and the likelihood of the
applicant being audited (applicant being audited (~~see~~see Table 1)..
Table 1. SBA’s Planned Risk Assessment for the SVOG Program’s Grant Recipients
Risk Level
Award Amount
Payment Schedule
Low Risk Low Risk
Less Less than $1 mil ion than $1 mil ion
Lump Sum or 2 payments Lump Sum or 2 payments
Moderate Risk Moderate Risk
Less Less than $1 mil ion than $1 mil ion
2 payments 2 payments
Moderate Risk Moderate Risk
$1 mil ion $1 mil ion to $10 mil ion to $10 mil ion
2 or 3 payments 2 or 3 payments
High Risk High Risk
$1 mil ion $1 mil ion to $10 mil ion to $10 mil ion
3 or 4 payments 3 or 4 payments
Source: SBA,SBA, Office of Inspector General (SBA OIG),Office of Inspector General (SBA OIG), Management Alert Serious Concerns About SBA’s Control
Environment and the Tracking of Performance Results in the Shuttered Venue Operators ~~Grant~~ Grant Program,, Report Report
Number 21-13, April 7, 2021, p. 3, at https://www.sba.gov/sites/default/files/2021-04/Number 21-13, April 7, 2021, p. 3, at https://www.sba.gov/sites/default/files/2021-04/
SBA%20OIG%20Report%2021-13.pdf. SBA%20OIG%20Report%2021-13.pdf.
The OIG noted that the SBA expected 15,000 applicants and an average award amount of $1 The OIG noted that the SBA expected 15,000 applicants and an average award amount of $1
~~million.~~ mil ion. “In cases where disbursements have multiple payments, the grantee “In cases where disbursements have multiple payments, the grantee ~~will~~ wil be required to be required to
submit documentation to show how the funds were spent prior to receiving the next submit documentation to show how the funds were spent prior to receiving the next
~~installment~~ instal ment.”30 The OIG also noted that under the planned disbursement schedule .”30 The OIG also noted that under the planned disbursement schedule
the majority of awards will be categorized as low risk and as such, be disbursed in sweeping the majority of awards will be categorized as low risk and as such, be disbursed in sweeping
lump sum payments with minimal requirements and expectations for post-award lump sum payments with minimal requirements and expectations for post-award
accountability.... with the exception of auditing all grant recipients receiving $10 million, accountability.... with the exception of auditing all grant recipients receiving $10 million,
which is the maximumwhich is the maximum cap for any single award, the plan would likely result in a minimal cap for any single award, the plan would likely result in a minimal
number of recipients subject to an audit. Most notably at the low-risk level, ODA [SBA number of recipients subject to an audit. Most notably at the low-risk level, ODA [SBA
Office of DisasterOffice of Disaster Assistance]Assistance] ~~set~~ set a maximum numbera maximum number of 10 audits,of 10 audits, despite program despite program
officials’ estimates that the majority of grant recipients would be in the ~~officials’ estimates that the majority of grant recipients would be in the~~ low-risk level. low-risk level.
Based on this framework, ODA’s audit plan exposes billions of dollars to potential misuse Based on this framework, ODA’s audit plan exposes billions of dollars to potential misuse
ofof ~~funds because the bulk of grant funds will not be subject to a reasonable degree of~~
~~scrutiny.31~~
~~The OIG recommended that the SBA “reassess the audit risk plan to identify vulnerabilities,~~
~~commensurate with the expected volume of applications and average award amount, to strengthen~~

~~28 SBA,~~ funds because the bulk of grant funds will not be subject to a reasonable degree of scrutiny.31 28 SBA, Office of Inspector General (SBA,Office of Inspector General (SBA, OIG),OIG), Management Alert Serious Concerns About SBA’s Control
~~Environment~~Environm ent and the Tracking of ~~Performance~~Perform ance Results in the Shuttered Venue Operators Grant Program , Report , Report
NumberNumber 21-13, April 7, 2021, p. 1, at https://www.sba.gov/sites/default/files/2021-04/SBA%20OIG%20Report%2021-21-13, April 7, 2021, p. 1, at https://www.sba.gov/sites/default/files/2021-04/SBA%20OIG%20Report%2021-
13.pdf (hereinafter SBA, OIG, 13.pdf (hereinafter SBA, OIG, ~~Management~~Managem ent Alert Serious Concerns About SBA’s Control ~~Environment~~Environm ent and the
Tracking of ~~Performance~~Perform ance Results in the Shuttered Venue Operators Grant Program ). ).
29 Before awarding29 Before awarding a SVOGa SVOG grant, the SBAgrant, the SBA ~~reviews~~ reviews the applicant’s risk usingthe applicant’s risk using factors such asfactors such as the applicant’s financial the applicant’s financial
stability, history of unsatisfactory performance, history of fulfilling the conditions of prior grants, and other stability, history of unsatisfactory performance, history of fulfilling the conditions of prior grants, and other ~~evidence~~evidenc e of of
responsibility. Seeresponsibility. See SBA,SBA, “Applications for New Awards;“Applications for New Awards; Shuttered VenueShuttered Venue Operators Grants (SVOG),”Operators Grants (SVOG),” 86 86 Federal
Register 16274, March 26, 2021. 16274, March 26, 2021.
30 SBA, 30 SBA, OIG,OIG, Management Alert Serious Concerns About SBA’s Control Environment and the Tracking of
~~Performance~~Perform ance Results in the Shuttered Venue Operators Grant Program , p. 3. , p. 3.
31 SBA,31 SBA, OIG,OIG, Management Alert Serious Concerns About SBA’s Control Environment and the Tracking of
~~Performance Results in the Shuttered Venue Operators Grant Program, p. 3.~~
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The OIG recommended that the SBA “reassess the audit risk plan to identify vulnerabilities, commensurate with the expected volume of applications and average award amount, to strengthen internal controls and reduce rise of misuse of federal funds.”32 The OIG’s management alerts do internal controls and reduce rise of misuse of federal funds.”32 The OIG’s management alerts do
not require, and not require, and ~~typically~~typical y do not include, a written response from the SBA. As a result, the SBA’s do not include, a written response from the SBA. As a result, the SBA’s
rationale for, defense of, or reconsideration of its planned award payment schedule and auditing rationale for, defense of, or reconsideration of its planned award payment schedule and auditing
framework was not presented in the OIG’s report.framework was not presented in the OIG’s report.
Concluding Observations
The SVOG program marks a departure from the typical structure of the SBA’s current programs. The SVOG program marks a departure from the typical structure of the SBA’s current programs.
The SBA has relatively littleThe SBA has relatively little experience, let alone systems in place, to administer a grant program experience, let alone systems in place, to administer a grant program
to a large number of for-profit and nonprofit entities. The SBA’s programs have to a large number of for-profit and nonprofit entities. The SBA’s programs have ~~typically~~typical y been been
targeted to “targeted to “~~small~~ smal business concerns,” as defined by the business concerns,” as defined by the ~~Small~~ Smal Business Act and implementing Business Act and implementing
regulations. In contrast, the SVOG uses unique sets of eligibility standards that are not tied to the regulations. In contrast, the SVOG uses unique sets of eligibility standards that are not tied to the
industry-specific size standards used in the SBA’s business loan programs. In addition, the SBA’s industry-specific size standards used in the SBA’s business loan programs. In addition, the SBA’s
programs have programs have ~~typically~~typical y catered to catered to ~~all small~~ al smal businesses, regardless of industry. The SVOG could businesses, regardless of industry. The SVOG could
represent a shifting congressional interest in having the SBA target assistance at meeting the represent a shifting congressional interest in having the SBA target assistance at meeting the
needs of specific industries in economic distress. needs of specific industries in economic distress.
Over the coming months, congressional oversight Over the coming months, congressional oversight ~~will~~wil , most likely, focus on the SBA’s , most likely, focus on the SBA’s
implementation of the SVOG program and eligibilityimplementation of the SVOG program and eligibility questions. As time passes, increased questions. As time passes, increased
attention is likelyattention is likely to be focused on fraud detection and prevention and program performance. The to be focused on fraud detection and prevention and program performance. The
SBA’s reporting requirements SBA’s reporting requirements ~~will~~ wil provide Congress information related to the agency’s efforts to provide Congress information related to the agency’s efforts to
detect, prevent, and prosecute fraudulent behaviors. The reporting requirements detect, prevent, and prosecute fraudulent behaviors. The reporting requirements ~~will~~ wil also provide also provide
information related to program outputs, such as the total number of initial and supplemental information related to program outputs, such as the total number of initial and supplemental
grants approved and disbursed and grant recipients. It remains to be determined whether Congress grants approved and disbursed and grant recipients. It remains to be determined whether Congress
~~will~~ wil receive useful information for measuring program outcomes, such as how many jobs the receive useful information for measuring program outcomes, such as how many jobs the
grants helped to create or retain, their impact on venue survivability and profit growth, and their grants helped to create or retain, their impact on venue survivability and profit growth, and their
impact on the artists who rely on these venues for their livelihoods. impact on the artists who rely on these venues for their livelihoods.

Author Information

Robert Jay Dilger Robert Jay Dilger
Sean Lowry Sean Lowry
Senior Specialist in American National Government Analyst in Public Finance Senior Specialist in American National Government Analyst in Public Finance

~~32 SBA, OIG,~~ Perform ance Results in the Shuttered Venue Operators Grant Program , p. 3. 32 SBA, OIG, Management Alert Serious Concerns About SBA’s Control Environment and the Tracking of
~~Performance~~Perform ance Results in the Shuttered Venue Operators Grant Program , p. 6. , p. 6.
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R46689 R46689 · VERSION 56 · UPDATED
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