Updated (Mar 26, 2021):
-
Register now>> South Arts is scheduled to host a webinar on Federal Funding with Nina Ozlu Tunceli from the Arts Action Fund on March 31st at 3:30 PM
Expected to be voted on Tuesday, March 9 for the last time and then delivered to the President to be signed into law, the American Rescue Plan (ARP) contains many arts-friendly provisions that help prop up an industry that’s been almost entirely shuttered for a year now. Below is a summary of the bill and how it can support the arts.
Big shoutout to our colleagues at Arts NC from whom we’ve lifted a lot of this content, with their permission. The SCAA has been in the throws of statehouse work the last two weeks (with news coming soon we hope) and it’s great to have colleagues who don’t mind sharing! Thanks Nate!
$135 Million for the National Endowment for the Arts
This one-time increase is targeted for COVID relief across the country. Remember, 40% of all NEA funds go to the states, meaning SC is poised to receive, we estimate, around $800,000 +/-. The SC Arts Commission is expected to leverage this funding for relief/recovery grants.
$350 Billion in Aid to State and Local Government
Relief funding totaling $350 billion will be distributed to state, territory, and tribal governments as well as to counties, metropolitan cities, and smaller cities and towns. The funds will be distributed as follows:
-
$195.3 billion to states and Washington DC
-
$20 billion for tribal governments
-
$4.5 billion for US territories
-
$60 billion to counties
-
$42 billion to metropolitan cities
-
$18 billion to smaller cities and towns
-
$10 billion for a capital projects fund
There is still much we do not know about the details of how these funds can be spent, though the American Rescue Plan outlined four expenses on which these governments are required to use this funding:
-
Respond to or mitigate the public health emergency with respect to COVID–19 or its negative economic impacts;
-
Cover costs incurred as a result of such emergency;
-
Replace revenue that was lost, delayed, or decreased (as determined based on revenue projections as of January 27, 2020) as a result of such emergency; or
-
Address the negative economic impacts of such emergency.
This last bullet is where governments will gain the authority to grant funds out to impacted industries. Further guidance in the bill specifically encourages governments to support businesses and nonprofits who were hurt by COVID, including tourism (which the arts are definitely part of).
Shuttered Venue Operators (SVO) Grants & Flexibility
The ARP adds another $1.25 billion to the SVOG program for a total of $16.25 billion available. Also, all those considering applying for an SVO Grant will be allowed to first apply for and receive a First or Second Draw PPP loan through an approved lender in this year, before the March 31st PPP application deadline. Eligible entities may then also apply for an SVO Grant when that application opens, subtracting their 2021 PPP loan amount from their SVO Grant award.
Extension & Tax Exemption of Federal Unemployment Benefits
-
Federal Pandemic Unemployment Compensation (FPUC) is extended for 25 weeks through September 6, 2021. During that period FPUC will provide federal funding for a $300 increase to all UI weekly benefits resulting from the pandemic.
-
Pandemic Unemployment Assistance (PUA) is expanded by 25 weeks (from 50 to 75 possible weeks), extending the program until September 6, 2021. PUA provides federal funding to states for weekly unemployment insurance (UI) benefits to the self-employed and independent contractors (1099 “gig” workers), as well as those who have exhausted all other UI benefits, who are unemployed as a result of the pandemic.
-
Pandemic Emergency Unemployment Compensation (PEUC) is expanded by 25 weeks (from 24 to 49 possible weeks), extending the program until September 6, 2021. PEUC provides federal funding for weekly UI benefits of claimants who have exhausted their state UI benefits.
-
Unemployment benefit payments will be tax-free for the first $10,200 of benefits for households with annual incomes less than $150,000.
Employee Retention Tax Credit (ERTC)
The Employee Retention Tax Credit (ERTC or ERC) will be extended for an addition two quarters at the same rate of up to $7,000 PER QUARTER (70% on $10,000 in wages) per employee for the EACH and EVERY quarter of 2021 for those businesses and nonprofits that that had a 20% loss of revenue in a single calendar quarter in 2020 compared to the same period in 2019, regardless of whether they have received a First or Second Draw PPP loan or an SVO Grant. These entities will also be able to receive a refundable credit for payroll taxes of up to $5,000 (50% on $10,000 in wages) per employee retroactively for all of 2020.
