Federal Economic Stimulus Relief Funds Provide Encouraging Support to the Nation’s Community-Based Arts and Culture Organizations Experiencing $3.6 Billion in Devastating Losses


The $2 trillion emergency stimulus package that Congress passed this week includes $300 million in economic relief to support nonprofit cultural organizations, museums, libraries, public broadcasting, and state and local arts and humanities agencies, as well as substantial additional economic relief opportunities for independent contractors like “gig economy” workers such as actors, musicians, and artists and nonprofit organizations and small businesses, including those working in the creative economy. Thousands of museums, performing arts centers, dance companies, theaters, writing programs, historical sites, libraries, and arts schools have had to close their venues and cancel performances, exhibitions, festivals, events, and entire seasons as a result of the pandemic. This has caused the loss of thousands of jobs and these cultural organizations are at severe financial risk.    

In response to the crisis within our cultural industry, Americans for the Arts quickly began surveying the economic impact of the coronavirus on the nonprofit arts industry. In just two weeks, more than 8,000 organizations provided detailed data on their measurable impact. The survey shows 93% of responding organizations have had to cancel events with total lost attendance topping more than 53 million people. The estimated direct loss of income for this industry to date is $3.6 billion. Americans for the Arts shared with Congress the details of its survey results, along with a series of specific legislative requests to prevent the collapse of the arts and culture industry in America.   

Americans for the Arts President and CEO Robert L. Lynch commented:  

“Americans for the Arts is thankful that Congress has made an initial investment of more than $300 million in stimulus relief funds to the arts that will be administered by key federal agencies, such as the National Endowment for the Arts, the National Endowment for the Humanities, and the Institute of Museum and Library Services. Funds will be granted to nonprofit and governmental cultural agencies in all 50 states and will be put to work to help save thousands of jobs and cultural organizations in communities across the country.  

“However, given that the arts and culture sector has faced a $3.6 billion economic loss just to date, we had hoped for more relief for the arts community. While this support is of great value, my concern is that it isn’t enough to keep many small and medium sized arts organizations afloat when their audiences can’t reach them, and their doors will likely have been shuttered for weeks and even months. Nonprofit arts organizations are the lifeblood of our communities. While the mission of these cultural organizations is to inspire, educate, and unite us, the general public may not realize that the arts and culture are also an economic powerhouse in this country. According to the Bureau of Economic Analysis, the arts and culture are a $878 billion economic industry, representing 4.5% of the nation’s GDP, supporting 5 million jobs, and generating a $29.7 billion trade surplus. Small business in America such as restaurants, parking lots, hotels, transportation, lodging, and others also depend on a robust arts community to bring customers to their venues. The nation cannot afford to lose the arts in their communities because they are part of both the economic and social recovery of our nation.

“We are also grateful that our cultural sector and the creative workforce—that has seen its audiences, and revenue, quarantined for several weeks now without an end in sight—has been made eligible for the paid leave provisions, the unemployment insurance expansion, and the Small Business Administration emergency disaster loan provisions.”

Specifically, the stimulus legislation includes the following arts-related items to address the continuing damage caused by the COVID-19 virus:
 
Federal Arts Funding (Note: This is a supplement to their annual appropriations)  

  • $75 million for the National Endowment for the Arts
  • $75 million for the National Endowment for the Humanities

Special note: Congress is waiving matching NEA and NEH grant requirements as well as the requirement for grants to be project specific. All these new fast-track grants will be for general operating support with no match.  

  • $75 million for the Corporation for Public Broadcasting
  • $50 million for the Institute of Library and Museum Sciences
  • $25 million for the Kennedy Center
  • $7.5 million for the Smithsonian

Arts-Eligibility Within Community Development Block Grants, Small Business Administration, and Unemployment Insurance

  • $5 billion for Community Development Block Grants to cities and counties 
  • $350 billion for Small Business Administration (SBA) emergency loans of up to $10 million for small businesses—including nonprofits (with less than 500 employees), sole proprietors, independent contractors, and self-employed individuals (like individual artists)—to cover payroll costs, mortgage/rent costs, utilities, and other operations. These loans can be forgiven if used for those purposes. This new eligibility is a key element of the CREATE Act
  • $10 billion for Emergency Economic Injury Disaster Loans (EIDL) for loans up to $10,000 for small businesses and nonprofits to be used for providing paid sick leave for employees, maintaining payroll, mortgage/rent payments, and other operating costs  
  • Expanded Unemployment Insurance (UI) that includes coverage for furloughed workers, freelancers, and ”gig economy” workers. The bill also increases UI payments by $600/week for four months, in addition to what one claims under a state unemployment program     

Charitable Giving Tax Deduction Incentives That Will Also Help Nonprofit Arts Organizations

  • An “above-the-line” or universal charitable giving incentive for contributions made in 2020 of up to $300. This provision will now allow all non-itemizer taxpayers (close to 90% of all taxpayers) to deduct charitable contributions from their tax return, an incentive previously unavailable to them. Additionally, the stimulus legislation lifts the existing cap on annual contributions for itemizers from 60 percent of adjusted gross income (AGI) to 100 percent of AGI for contributions made in 2020.

The inclusion of these provisions to help the broad and essential nonprofit community, the arts sector, and the creative workforce can be attributed, in part, to the monumental grassroots outreach to Congress by arts advocates across the country, coordination with national nonprofit industry coalitions, and Americans for the Arts and Arts Action Fund outreach to the U.S. House and Senate and the Trump Administration. It is likely that another stimulus package will be considered by Congress as the economic fallout from the coronavirus adds up across the country and Americans for the Arts will be working with stakeholders in every corner of the nation to ensure additional support is providing to a nonprofit arts industry that is in economic freefall.
 
For more information, please visit the Americans for the Arts Coronavirus (COVID-19) Resource and Response Center.





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