City awards second round of SAVES funds to closed music venues

The city has begun awarding grants to 28 music venues selected to receive assistance from a $5 million program created to help preserve businesses that have been largely closed since the onset of the Covid-19 pandemic last spring. The grants of up to $140,000 each were the second phase of awards from the Save Austin’s Vital Economic Sectors (SAVES) program, which was among nearly a dozen new Covid recovery programs spun up over the past year using city and federal funds.

The first phase of $20,000 SAVES grants were given to 74 venues late last year to provide an emergency infusion to cover rent and other debt accrued since March 2020 when the city canceled South by Southwest amid the spread of the virus. That initial pool of recipients was eligible to apply for the second round, with about 60 businesses attempting to get more city funding.

The Long Center, which helped to administer the program, looked at major factors such as a business’ overall vulnerability and its impact on the city’s cultural fabric, with discrete metrics such as total revenue decline, working capital available, percentage of revenue created by live music, total number of performances per year, staffing levels, and infrastructure investments also taken into consideration.

Bobby Garza, vice president of programs and community outreach for the Long Center, said there was about $2.9 million of unmet need between the program’s budget and the total requests from the second round. While some venues have adjusted their business models to operate as bars and restaurants over the past year, there has been a large falloff in revenue that requires city or federal assistance to cover.

“We knew going into this that the $5 million in this fund was less than what the total community need was, since there were a lot of venues that were in crisis and really struggling,” he said. “Even with other revenue streams available, I don’t think anyone responded that they were doing just fine right now.”

There is more help on the way for music venues, both in Austin and beyond, since Thursday marked the opening of the application process for the $16 billion federal Shuttered Venue Operators Grant program. The city is also due to receive another infusion of several million dollars from the second recently passed federal stimulus, with staff and Council set to discuss next week how to begin allocating that money.

Garza said the Long Center has the data available on what is needed to help the city’s music venues, with the hope of gradually opening back up as vaccination levels continue to increase through the spring and summer.

“We know from the application process for the second phase of grants that there’s still at least $2.9 million of need left, so that’s a good starting point. Council will be the ones to determine the priorities for the next round of funding and we’ve always said that if there’s a need to continue administering a new infusion of funds, then that is something we’d be willing to push.”

The second round of SAVES grants included participation in a technical assistance program, with the expectation that venues and their landlords would negotiate a workable debt repayment schedule and possibly a revised lease agreement to keep financially fragile music venues open around the city.

Rebecca Reynolds, president of Music Venue Alliance Austin, said with the city’s real estate market hotter than ever, there is increased pressure on those businesses that could result in displacement without proactive steps like reopening leases.

“One requirement was a tech assistance panel to create conversations with landlords about what’s the middle ground, because the city didn’t want to award tenants grant money to then pass on to landlords so when the landlords get made whole it’s like nothing ever happened. There’s a need to negotiate in the middle somewhere,” she said.

“Some landlords understand and are willing to do that, and others not so much, and their thinking is that the market right now is so hot we can get rid of this without having to negotiate anything.”

Photo by Larry D. Moore, CC BY-SA 4.0, via Wikimedia Commons.

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