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The CARES Act: A Retrospective One Year Later

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After intense advocacy by Recording Academy members, Congress intervened to bolster a cratering economy by passing the bipartisan and bicameral CARES Act, an achievement to celebrate a year after its passage
Matthew Bango
Advocacy
Apr 15, 2021 - 9:03 am

On March 27, 2020, after significant input and backing by the Recording Academy and other organizations, Congress intervened to bolster a cratering economy by passing the bipartisan and bicameral Coronavirus Aid, Relief, and Economic Security (CARES) Act. A $2 trillion stimulus package, the CARES Act was designed to temporarily stabilize the economy and safeguard ties between workers and their employers, including those in the music industry. Now more than one year into the pandemic, let’s look back and celebrate the CARES Act on the first anniversary of its passage, which has proved to be a pivotal lifeline for many music creators.

The CARES Act established innovative relief programs, extended unemployment insurance eligibility to music creators historically excluded from assistance, and appropriated funds to directly support the arts community. With input from the Recording Academy, Congress implemented the Paycheck Protection Program (PPP) to provide relief for self-employed workers and small businesses, passed an unprecedented and historic expansion of unemployment benefits, known as Pandemic Unemployment Assistance (PUA), for gig workers, freelancers, and other self-employed music professionals, and appropriated $75 million in supplemental funding for the National Endowment for the Arts. These programs, and more, gave direct influx of cash to music creators and small businesses at the onset of the pandemic.

Amongst the initial rush of implementation of the CARES Act, many music creators questioned how to best navigate this new relief programs. Recognizing the need for greater assistance within the music ecosystem, the Recording Academy hosted a webinar on how to best navigate the relief landscape and established the “CARES Act Hotline” to answer individual questions. These resources directly assisted hundreds of music creators to accurately apply for a PPP loan and navigate complex unemployment insurance scenarios. 

Future advocacy work then focused on fixing technical problems as they were identified. For example, many “mixed earners,” those with both traditional and freelance income, found themselves to be ineligible for certain unemployment programs due to oversights included in the CARES Act and the antiquated state unemployment systems. Additionally, many small businesses had difficulty accessing PPP money before the program exhausted funding. 

The Recording Academy identified solutions to many of these problems, and shifted gears to ensure relief truly worked for the music ecosystem. Many of these proposed technical corrections were passed as standalone bills, included in subsequent relief packages, or addressed administratively, including extending the PPP application window, establishing a supplemental fund for mixed earners, and improving the PPP formula for self-employed workers, among others.

And as chronicled by Billboard, the Recording Academy and its members didn’t stop with short-term fixes but continued to advocate for long-term solutions to ensure a full recovery for music creators. As part of a year-end spending deal, the Recording Academy and its allies in the music ecosystem secured funding for several creator-friendly legislative priorities, including expanding pandemic unemployment assistance programs for eligible self-employed workers, establishing a $15 billion supplemental fund to assist live music venues, and replenishing SBA loan programs for independent contractors and small businesses, among others. The Academy and its members also managed to secure necessary guidance changes and funding for the SBA relief programs, and an additional extension of unemployment programs for gig workers, self-employed individuals, and mixed earners as part of the American Rescue Plan, which was signed into law in March 2021.

This past year has proven to be physically, emotionally, and mentally difficult for all Americans, and music creators have been particularly impacted by the pandemic. Unable to access traditional income streams and distant from their community, many creators have been left wondering where their next paycheck will originate from or when their next opportunity to reunite with their beloved bandmates will occur. While this year has tested the entire music ecosystem, our ability to stand united behind a shared cause has resulted in tremendous legislative accomplishments.

While our fight against the COVID-19 pandemic started with the CARES Act, we must continue to pressure Congress in support of long-term solutions geared at recovery, including securing the passage of the HITS Act and ensuring the swift implementation of the Shuttered Venue Operators Grant. As always, the Recording Academy and its members will continue to champion legislative solutions to establish a more equitable and creator-friendly music ecosystem.  

Take Action: Ask Congress to Pass the HITS Act

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Small Business Association To Wind Down Paycheck Protection Program, Ending Historic Relief Program

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As part of a massive revamp, the SBA is winding down the end of the nearly $1 trillion PPP while setting up an online loan forgiveness process. Here's how you can access it
Morgan Enos
Advocacy
Jul 28, 2021 - 3:09 pm

The Paycheck Protection Program helped buoy millions of small businesses during the COVID-19 pandemic—and now it's coming to an end.

As Politico reports, the Small Business Association (SBA) on Wednesday announced the beginning of the end of the historic, nearly $1 trillion program, announcing in its stead an online loan forgiveness platform that will accept applications from small borrowers.

This initiative will encourage borrowers with loans of $150,000 or less — accounting for more than 90 percent of the pandemic-era program — to apply for loan forgiveness.

The ability to turn PPP loans into grants in exchange for maintaining payroll was a key component of the small business rescue initiative. However, nearly 7 million of those loans have not been forgiven.The SBA's new platform will accept applications from small borrowers directly in a format that officials estimate will take businesses just a few minutes to go through.

What's more, they plan to spare certain borrowers who received second PPP loans this year worth less than $150,000 from having to supply documentation proving that they suffered a 25 percent revenue reduction in 2020 that was required to receive the aid.

The SBA plans to launch the site on a pilot basis on Wednesday (7/28) and have it go live around August 4. This development will be germane to many music creators, who may be considered sole proprietors, independent contractors, or self-employed businesses—which is exactly who the PPP was aimed at in the first place.

Last February, the Biden Administration and SBA jointly announced changes to the PPP, adding increased access to essential financial relief for the creative workforce. Formed as part of the CARES Act, the PPP has enjoyed overwhelming bipartisan support due to its ability to rapidly deliver relief to qualified small businesses, sole proprietors and independent contractors. 

While the PPP will soon be a thing of the past, the Recording Academy's Advocacy wing urges those still in need to access the upcoming portal and pursue PPP loan forgiveness if they meet the qualifications.

Updated: Biden Administration Announces Creator-Friendly Changes To The Paycheck Protection Program

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National Endowment For The Arts Announces Guidelines For Grant Awards Under American Rescue Plan

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Additional good news has arrived regarding NEA funding: President Biden and Congress are moving toward "record level" funding for the arts for the pending fiscal year
Morgan Enos
Advocacy
Jun 30, 2021 - 3:32 pm

The National Endowment for the Arts recently announced its guidelines for grant awards under the American Rescue Plan (ARP), which President Biden signed into law in March and includes $135 million in emergency relief funding for the NEA. 

While venues are reopening nationwide in response to mass vaccinations and artists are finally seeing work, this increased cash flow to the NEA will be a boon to creative industries that the COVID-19 pandemic existentially threatened for more than a year.

Earlier this year, the NEA distributed 40% of that $135 million ($52 million) to state and regional arts agencies.  The remaining 60% will now be available through two competitive grant opportunities: one for local arts agencies, and one for non-profit organizations.

The NEA is currently accepting applications with an emphasis on specific organizations. These include those that serve populations whose opportunities to experience the arts are limited by ethnicity, economics, geography, or disability; organizations with small and medium-sized budgets; organizations from rural to urban communities; and organizations that may be applying for federal support through the Arts Endowment for the first time.

According to the NEA website, that support is limited to any or all of the following:

salary support, full or partial, for one or more staff positions; fees/stipends for artists and/or contractual personnel; facilities costs such as mortgage principal, rent, and utilities; costs associated with health and safety supplies; and marketing and promotion costs.

For the Recording Academy, expanding opportunities to organizations that have not previously received NEA funds was a priority. Grants to organizations are intended to support day-to-day business expenses/operating costs and will be awarded in grant amounts of $50,000, $100,000 or $150,000. (Those applications are due in August.)

The NEA's guidelines mark the latest positive development in federal aid for creative industries. On June 28, 2021, the U.S. House Appropriations Interior Subcommittee released its FY 2022 spending bill. This subcommittee is responsible for setting the funding levels for the National Endowment for the Arts (NEA) and other cultural agencies. The subcommittee matched the Biden Administration's budget request of $201 million for the NEA. This would represent an increase of $33.5 million over the current budget for the NEA, the largest increase in the agency's history.

Next, the spending bill will still need to pass the subcommittee, full committee, and the full House. The same process will also take place in the Senate Appropriations Committee. Daryl Friedman, the Recording Academy's Chief Advocacy Officer, has submitted written testimony to both the House and Senate requesting full funding for the NEA.

"The NEA remains an integral part of the cultural bedrock of the United States, working to bring music and the arts to towns and communities across the country," Friedman wrote. "Its mission has never been more important, and as the creative arts look to recover from the COVID-19 pandemic, the agency will prove to be a key lynchpin in the resumption of arts throughout America."

The Recording Academy's Advocacy department will continue to keep lawmakers, music workers and listeners abreast of new developments in this quest for equity in creative spheres. For more information, visit the NEA's website at https://www.arts.gov.

Why The American Music Fairness Act Will Give Music Creators What They Deserve

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Updated: Biden Administration Announces Creator-Friendly Changes To The Paycheck Protection Program

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The Biden Administration announced welcomed changes to the Paycheck Protection Program, increasing aid to music creators
Matthew Bango
Advocacy
Feb 24, 2021 - 11:45 am

UPDATE: This article, originally posted on Feb. 24, 2021, has been updated with new information for music makers and music small businesses based on the recent passage of the American Rescue Plan, and new regulatory updates by the Small Business Administration.  Importantly, effective March 3, self-employed individuals (including independent contractors, gig workers, and sole proprietors) will be eligible for an increased PPP loan amount based on their gross income. Per the SBA, this change is limited to applicants who had yet to be approved for a loan as of March 3.

Additionally, per the American Rescue Plan, eligible businesses may now apply for both a PPP loan and a Shuttered Venue Operators Grant (SVOG). Previously, potential applicants for SVOGs were prohibited from applying for assistance from programs. Under the new law, the PPP loan will offset the potential amount of an SVOG. The SVOG program will open for applicants on April 8, and PPP remains open for all small businesses until May 31.

Please contact advocacy@grammy.com with any questions.

The Biden Administration and Small Business Administration (SBA) announced new changes to the Paycheck Protection Program (PPP) on Monday, February 22, which will result in increased access to essential financial relief for the creative workforce.  Formed as part of the CARES Act, the PPP has enjoyed tremendous bipartisan support due to the program’s ability to quickly deliver relief to qualified small businesses, including sole proprietors and independent contractors. The PPP administers favorable loans to eligible borrowers through participating financial institutions, and many of the loans convert to grants if they are primarily used to fund payroll expenses.

While the relief program is appreciated and utilized by the music community, many struggling creatives were originally left with either limited or no access to the available loans administered by the SBA. But starting today, the SBA attempts to correct these inequities and other longstanding programmatic flaws by implementing new guidance.

Many creators will be directly impacted by the SBA’s updated funding formula for sole proprietors, independent contractors, and self-employed individuals. Previously, the PPP loan was calculated by multiplying an applicant’s payroll expense by 2.5, resulting in a much lower loan for sole-proprietors compared with larger businesses. Under the updated guidance, the SBA will calculate the loan amount for these types of workers by using gross income instead of net profits, resulting in larger payments for many members of the music ecosystem. This change is effective March 3, and applicable to applicants who have yet to be approved for a PPP loan in 2021. The Recording Academy has consistently advocated for this change since March, 2020, which will help make PPP loans more responsive to the needs of self-employed individuals.

From the program’s inception, many minority-owned businesses and businesses located in underserved communities faced difficulty accessing loans due to a lack of a formal pre-existing relationship with large financial institutions. To correct that program, the SBA has earmarked $1 billion in funds for low- and moderate-income areas. While this is a step in the right direction, the Biden Administration and the SBA must continue to increase outreach and assistance to these underserved communities and minority-owned institutions.

The SBA also prioritized getting relief to businesses with 20 employees or less, which started on February 24 and concluded on March 9, 2021. Previously, these businesses struggled to secure PPP funds due to the overcrowded lending portal. Understanding that many businesses in the music ecosystem are extremely small operations, the Academy has long advocated for the SBA to prioritize the delivery of financial relief to the smallest of businesses, many of whom are on the verge of collapse due to the pandemic’s enduring impact.

Other changes in guidance include the elimination of borrowing restrictions for business owners with non-fraud felony convictions, the removal of the disqualifying federal student loan debt delinquency factors, and the expansion of the program to qualify all lawful U.S. residents. Learn more about the application process on the SBA’s website. 

While many of these promising changes will positively impact the entire music ecosystem, Congress understood the need of providing additional relief and passed President Biden’s “American Rescue Plan” as a result. The relief package addresses the many complex challenges facing creators by extending unemployment assistance, appropriating funds to help small businesses survive, and investing in the National Endowment for the Arts (NEA). The Academy applauds President Biden and Congress on the passage of this landmark bill, and looks forward to collaborating on an equitable and seamless implementation of these critical relief programs, many of which will greatly assist the entire music ecosystem.

Editor’s Note: This article was originally published in February 2021 and has been updated to reflect the passage of the American Rescue Plan end of the 14-day exclusive application window.

Read More: Billboard: How The Recording Academy And Its Allies Scored Big Wins In COVID Relief Package

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The Recording Academy Announces Behind The Record Advocacy to Advance Creators’ Rights in Washington

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Behind the Record Advocacy is a new virtual advocacy program for Academy members to advance the rights of creators behind the record
Advocacy
Sep 17, 2021 - 2:52 pm

The Recording Academy's Advocacy department recently launched Behind the Record Advocacy, a new virtual advocacy program for Academy members to champion the rights of creators behind the record.

Building off the success of the Academy’s Behind the Record initiative, the Academy is expanding its commitment to give credit where credit is due by meeting virtually with Members of Congress to educate them on the creators behind their favorite records, and discuss the key issues impacting the music community.

The new Advocacy program takes place nationwide on October 14. Academy members can register at the landing page here.

During the virtual meetings, Academy members will focus on legislation currently being considered in Washington that would have a direct impact on America’s recording artists, songwriters, and studio professionals, like the HITS Act and the American Music Fairness Act. Behind the Record Advocacy will fight to ensure that those behind the record can earn fair compensation for their work.

The Recording Academy Advocacy department will organize and schedule the meetings, as well as help educate registrants on the issues, talking points and key messaging. Participants just have to be themselves, discuss their careers, and their livelihoods as music makers, while helping to champion the key legislation that would advance their rights as music makers.

The virtual advocacy day is designed to complement the widely popular Behind the Record movement, taking place the very next day on October 15. The third annual Behind the Record initiative will once again spark an impactful, cultural moment on social media where all creators are recognized for their essential roles in making the music we love.

Registration for Behind the Record Advocacy closes Monday, Sept. 20, so don't delay if you'd like to participate in this one-of-a-kind initiative!

The Recording Academy's Advocacy Team Joins Twitter Spaces: A New Way To Have Discussions That Uplift All Musicians