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Financing

SBA opens the gates on a new $16.2B aid program

Grants of up to $10 million are reserved for facilities whose main business is live providing entertainment, but some foodservice operations could be eligible.

UPDATE: The U.S. Small Business Administration has pushed back the starting date for receiving SVOG applications, citing "technical difficulties" with the process. "SBA is working closely with the portal vendors to reopen as soon as possible," the agency says in a posting on its website. "SBA will share advance notice of the time and date before the reopening."

Dinner theaters and other entertainment facilities where food and beverage sales generate a secondary revenue stream can apply for federal grants of up to $10 million as of noon on April 8, the U.S. Small Business Administration (SBA) confirmed on opening day.

The money will be drawn from a $16.2 billion aid pool earmarked by Congress back in December to help concert halls, museums, theaters, comedy clubs and performing arts centers survive the pandemic.

The Shutter Venue Operator Grant (SVOG) program is not intended for restaurants or entertainment venues that generate the bulk of their business from foodservice operations. But the SBA notes that some dinner theaters could qualify, depending on their business models.  

Performance facilities where food sales are a secondary business would also presumably be eligible for consideration, though the SBA has a long list of criteria for deciding what businesses merit consideration. To qualify, an establishment must have seen its revenues drop by at least 25% between a quarter of 2020 and the corresponding period of 2019.

Operations owned by public companies are expressly ineligible, as are strip joints and offer places offering adult entertainment.

The grant applications will be handled on a first-in, first-out basis, with awards set to start at the end of April, the SBA says. However, preference will be given during the first 14 days of the allocation process to facilities that lost 90% or more of their revenues between April and December of 2020. During the second 14 days, applications from places that suffered a revenue drop of 70% of more will have a weighted value.

“The SBA is committed to moving as quickly as possible to deliver this vital funding effectively and equitably—ensuring relief goes to those venue operators whose revenues have been most impacted by the pandemic,” SBA Administrator Isabella Guzman said in a statement.

The SVOG program is one of several ancillary aid initiatives that are intended to supplement the relief provided to small businesses through the Paycheck Protection Program, the federal government’s main effort to help that community.

The SBA has not yet revealed when it will start accepting applications for grants from the $28.6 billion Restaurant Revitalization Fund.

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