27 Mar US live events sector’s CARES Act concerns
The US Government’s $2.2tn (€2tn/£1.8tn) economic stimulus package “stops the bleeding” but does not do enough to stabilise the live events industry in the wake of the Covid-19 outbreak, according to Isaac Rothwell, spokesperson for the Live Events Coalition.
On Wednesday, the US Senate passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act with bipartisan support (96-0) in a move designed to mitigate the effects of the pandemic for businesses, individuals, states and workers.
Among other things, the bill established a $350bn loan guarantee programme to help small businesses retain employees on the payroll. However, Rothwell, the national director of operations at Digerati Productions, told TheTicketingBusiness that due to the “unique nature of our industry we require grants and not loans that are later forgiven.”
He continued: “Much of our industry is not financed traditionally and therefore doesn’t have the banking relationships needed to quickly apply and get adequate relief. Additionally, most of the important larger players in our industry are not truly large corporate conglomerates on the national level so the bill left a large hole for relief for medium sized business that are too big for SBA loans and leveraged in such a way that taking on debt is not an option. Basically, we need grants.”
Reflecting Rothwell’s thoughts, Eileen Valois, Live Events Coalition member and senior vice president sports and fan entertainment at PRG Worldwide Entertainment Technology Solutions, said the CARES Act only supports a small number of workers in the industry.
She said the industry is currently focused on trying to get through the crisis period such as covering operating expenses and payroll issues. However, she said the goal of the Live Events Coalition is to be mindful of the industry’s ability to recover and stabilise following this long-term blackout forced upon them by the Covid-19 outbreak.
She added: “Live events came to a grinding halt – literally overnight with no warning. People don’t often realise how expansive the live industry is. It includes so many people from the people who supply the badges, to ticketing firms, merchandise vendors, and promoters, among many others, who are suddenly without a job or an income.”
The CARES Act has made no impact on stabilising the live industry, Rothwell said, adding: “It looks to simulate the entire economy while our sector has no way to generate revenue. So, much more specific measures will have to be taken to address our specific and unique needs that differ greatly from other industries.”
However, both executives acknowledged that the CARES Act’s expanded unemployment is a “step in the right direction,” but notes that most of the 1099 employees, or independent contractors, and salaried employees in the live industry “will not be able to make ends meet without deferring monthly bills.”
Rothwell continued: “There are many middle class single income families in our industry that will not be able to support their families on max unemployment benefits even with an extra $600.
“We are looking at six months to a year shutdown for live events no matter how this plays out and I know for me that would be getting by on 30% of my monthly income to support a family of six. I am as worried for my family, as I am for others, as we sacrifice our livelihoods for the good of our nation.”
The Live Events Coalition was formed earlier this week off the back of Rothwell’s individually-launched petition, which grew legs following support from Valois and others. The Change.org petition, which is directed at President Donald Trump, is seeking a federal aid package that includes Emergency Medicaid Health insurance to cover uninsured business owners, contractors and laid off employees, as well as the ability to submit cancelled contracts as loss of income on 2020 taxes. It is also calling for $200bn in low interest federally backed business liquidity loans and $100bn in employee retention grants to avoid widespread layoffs.
Rothwell told TheTicketingBusiness that the petition would now change course following the CARES Act announcement. He said: “I have been absorbing a lot of data and advice from around the industry and some economic development experts. This will lead to some more specific requests that I believe will stabilise our industry if acted on by the Federal Government.”
The petition has already gained 373,567 signatures, with a target of 500,000.