What the American Rescue Plan Means for the Creative Workforce
President Biden and the new 117th Congress worked quickly to provide additional financial relief to combat the enduring impact of the COVID-19 pandemic by passing the $1.9 trillion American Rescue Plan (ARP) in March 2021, which the Academy supported and helped shape many of the final provisions included in the legislation.
Below are some key benefits for music creators:
- Updates guidance and appropriates additional funding for existing Small Business Administration (SBA) loan programs.
- Adds $1.25 billion to the Shuttered Venue Operators Grants (SVOG) fund, which supports eligible live venue operators or promoters, theatrical producers, live performing arts organization operators, museum operators, motion picture theatre operators, or talent representatives who demonstrate a 25% reduction in revenue.
- The Small Business Administration (SBA) is responsible for issuing $15 billion in loans included in the previous financial relief package.
- More information on the SVOG program can be found HERE.
- Increases the Emergency Injury Disaster Loan (EIDL) funds by $15 billion and the Paycheck Protection Program (PPP) funds by $7.25 billion.
- The EIDL application can be found HERE.
- If you recieved a PPP loan of $150,000 or less you are now eligible to apply for 100% forgiveness directly via the SBA (and not through your lender), more information can be found HERE.
- For PPP loans greater than $150,000, be sure to submit your PPP Forgiveness Form to your bank lender in order to convert your loan to a tax-free grant.
- Allows applicants to apply for both PPP and SVOG loans, a departure from the guidance included in the previous relief package.
- Check back for additional guidance on these programs.
- Extends unemployment programs for gig workers, self-employed individuals, and “mixed earners"
- Expands the Pandemic Unemployment Assistance (PUA) through September 6, 2021.
- Continues to fund the Federal Pandemic Unemployment Compensation (FPUC) at $300 per week and to add $100 per week for music creators with mixed income (a combination of W2/1099 wages) sources through September 6, 2021.
- 9/6 Update: Pursuant to the American Rescue Plan, all federal unemployment workers expired on September 6.
- 5/20 Update: Certain states have opted out early of federal programs, and will discontinue benefits prior to September 6.
- Waives federal income tax up to $10,200 for unemployment benefits received in 2020.
- Includes other relief provisions to directly combat the virus and the resulting financial fallout.
- Issues direct relief payments of $1,400 per taxpayer and $1,400 per child or adult dependent for single filers earning less than $80,000 or joint filers earning less than $160,000 in adjusted gross annual income.
- Includes funds earmarked for vaccine distribution, rental assistance, schools, and state and local governments, among others.
What the Consolidated Appropriations Act of 2021 Meant for the Music Ecosystem
As part of an end-of-year government spending bill, Congress reached a deal to provide the American public with additional COVID-19 relief on Sunday, December 20, 2020. The package includes $900 billion in new COVID-19 relief that will fund many critical provisions to assist struggling creators to survive the enduring financial hardship inflicted by the pandemic:
- Expanded critical pandemic unemployment assistance programs for eligible self-employed workers
- Increased the Pandemic Unemployment Assistance (PUA) program to April 5, 2021, including an extension of the eligibility period to 50 weeks
- Authorized a $100 per week bonus payment for music makers with mixed income to offset some of the eligibility complications encountered under the CARES Act
- Re-imagined the Federal Pandemic Unemployment Compensation (FPUC) program by funding it at $300 per week in additional unemployment benefits for all individuals receiving unemployment assistance until March 14.
- Established a $15 billion supplemental fund to assist live entertainment venues and other struggling cultural institutions
- Authorized $15 billion in Small Business Administration (SBA) grants for eligible live venue operators or promoters, theatrical producers, live performing arts organization operators, museum operators, motion picture theatre operators, or talent representatives who demonstrate a 25% reduction in revenue
- The agency will make initial grants of up to $10 million per eligible entity and a supplemental grant that is equal to 50% of the initial grant, which can be used for payroll costs, rent, utilities, and personal protective equipment (PPE).
- Modeled after the Save Our Stages (SOS) Act, the program helped independent venues survive the enduring impact of the pandemic and ensure live music can return to the stage safely in the future.
- Replenished Small Business Administration loan programs for self-employed workers and small businesses
- Appropriated $284 billion for both first and second rounds of Paycheck Protection Program (PPP) loans for individual, self-employed music makers and small businesses, which may be fully forgiven if primarily used on payroll expenses.
- Replenished the Economic Injury Disaster Loans (EIDL) program with $20 billion in new funding, awarding self-employed workers and businesses a special advance grant up to $10,000 to pay for expenses.
- Allocated $3 billion in funding for Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) in an attempt to address the uneven impact of COVID-19 felt by minority-owned businesses and underserved communities.
What the CARES Act Meant for Music Makers
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, a $2 trillion COVID-19 relief package, contained a number of key protections and provisions that put music creators in a better position for immediate and long-term relief.
As the benefits rolled out nationwide, there were several key areas of relief that certain music creators were eligible for:
- Designed a new pandemic unemployment assistance program for eligible self-employed workers
- Available to self-employed music professionals who, due to the effects of the Coronavirus, are out of work or unable to work.
- Eligibility for unemployment benefits was retroactive and the duration of unemployment benefits was extended for an additional 13 weeks (beyond the standard 26 weeks) through the end of the year.
- In addition to standard unemployment benefits, individuals also received an additional $600 per week for a period of four months, ending July 31.
- 8/1 Update: The FPUC program has now expired. An Executive Order, signed by the President, provided additional temporary unemployment benefits to certain qualified applicants.
- Established new Small Business Administration loans for self-employed workers
- Individual, self-employed music makers were eligible to apply for “paycheck protection” loans from the SBA which may qualify for full loan forgiveness if they are used to provide income support.
- Individual, self-employed music makers were also eligible to apply for Economic Injury Disaster Loans (EIDL), including a special advance grant up to $10,000 that can be used to pay for expenses and does not have to be repaid.
- Created a $75 million supplemental fund for the National Endowment for the Arts
- 60% of funds were dedicated to direct grants for non-profit organizations and other eligible recipients to respond to the coronavirus.
- The remaining 40% were distributed to state and regional arts councils, which also can go to fund and assist local musicians and artists.
- Funds were available through September 2021 and are in addition to the $162 million appropriated for the NEA in the current fiscal year.
How the Recording Academy Advocated for COVID Relief
Recording Academy’s “Contact Congress” campaign resulted in tens of thousands of emails to Congress asking for this relief. At the same time, Academy lobbyists in Washington, working with a broad coalition of entertainment organizations, lobbied key Senators and Congressional leadership. Many of the provisions that would help freelance music professionals were not included in the original drafts and were added as a result of lobbying from the music community. You can read more about the Academy's efforts in Billboard.
The Academy is continuing to work with House and Senate leadership to explore additional areas of support for the music community.