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Article Published: 10 May 2021

Relief in Sight

President Biden’s American Rescue Plan Act offers myriad benefits to the industry.

President Biden achieved a significant legislative win when on March 11, just 50 days into his administration, he signed the $1.9 trillion American Rescue Plan Act (ARPA) of 2021. Responding to the COVID-19 pandemic, the act delivers comprehensive and much-needed relief across a wide sector of society: businesses, nonprofit organizations, states, local governments, schools, families, and individuals.

Significantly, ARPA provides support to the hard-hit arts and cultural sector, opera included. In order to comply with federal, state, and local public health and safety directives, arts organizations have canceled their public events and performances since spring 2020. According to the National Endowment for the Arts, the community has endured some of the nation’s highest rates of unemployment. The national unemployment rate for the fourth quarter of 2020 was approximately six percent, but for producers and directors it was 17 percent and for singers and musicians it was 27 percent.

Economic data shows that the creative economy is an important part of national, state, and local economies. According to 2019 data from the U.S. Department of Commerce’s Bureau of Economic Analysis, arts and cultural economic activity accounted for 4.3 percent of the gross domestic product (GDP), or $919.7 billion. Furthermore, the sector employed over 5.2 million wage-and-salary workers who earned $466 billion, representing a larger share of the nation’s economy than transportation, tourism, or agriculture. For the nation to survive economically during the current pandemic and to thrive beyond it, the creative economy must be supported, while its creative workers, including opera professionals, need to be able to get back to work as soon as possible and as safely as possible.

Fortunately, ARPA extends and establishes various pandemic relief programs for the benefit of arts and cultural-related businesses and nonprofit organizations, as well as local arts communities, families, and individual creative workers. ARPA additionally provides emergency funding to various federal arts and cultural-related agencies, including $135 million to the NEA. Forty percent of this funding ($54 million) will be funneled to state arts agencies, which will distribute these funds via sub-grants to regional arts organizations. The other 60 percent ($81 million) will be apportioned to direct grants to individual entities. The grants will carry no cost share or matching fund requirements. It is also expected that grantees can use their grant awards for operational expenses, including salary support, fees for artists or contractual employees, and facility costs.

The Paycheck Protection Program (PPP), which supports small and medium-sized businesses, as well as sole proprietors and independent contractors, will receive $7.25 billion in additional funding. Meanwhile, ARPA will deliver an additional $1.25 billion, on top of $15 billion already allocated, to the Shuttered Venue Operators Grant (SVOG) program. Established in December, under prior pandemic relief legislation, the SVOG program was designed to help performing arts organizations that operate, own, manage, or rent venues and were forced to cancel public events and performances. The PPP will stop accepting applications after May 31, while the SVOG program started on April 26.

ARPA provides other relief for businesses and nonprofit organizations within the arts and cultural sector. It extends the Employee Retention Tax Credit (ERTC) program until the end of 2021. This is a refundable tax credit against certain employment taxes equal to 50 percent (for 2020) and 70 percent (for 2021) of qualified wages eligible employers pay to their employees. Eligible employers can have their tax liabilities reduced by the credit or receive a check in advance from the Internal Revenue Service. Organizations can apply for a combination of PPP, SVOG, and ERTC funds as long as they direct the proceeds toward different purposes.

The Pension Benefit Guaranty Corporation (PGBC) is an ARPA fund that assists struggling single-employer and multi-employer plans to keep them solvent and cover benefits for the next 30 years. Eligible plans can apply for special financial assistance; once received, it does not need to be repaid.

As opera companies and opera-related nonprofit organizations begin to resume their public performances and public-facing events, ARPA provides billions in funding for COVID testing and the distribution of vaccines. This financial support will allow states and local governments to ease various indoor and outdoor restrictions concerning public health and safety. Furthermore, ARPA provides $350 billion to states and local governments, which will allow states to provide grants to the hardest-hit organizations in the hardest-hit industries, the arts included.

ARPA gives critical financial support to the nation’s families and individuals, including those that work within the creative economy. It extends various federal unemployment assistance programs until September 2021, including the Pandemic Unemployment Assistance Program, which supports self-employed creative workers, gig workers, and independent contractors not considered eligible for regular federal unemployment assistance. This program has supported millions of creative workers during the current pandemic and will ideally provide financial support until arts and cultural-related businesses and nonprofit organizations can resume their public performances and events.

As the nation moves beyond the pandemic, the arts and cultural sector is developing and sharing best practices for the reopening of operations and performance spaces. In January, the NEA released a guide, “The Art of Reopening: A Guide to Current Practices Among Arts Organizations During COVID-19,” that highlights what various performing arts companies and nonprofit organizations are doing across the nation to provide programming and other services to their respective communities.

The Biden-Harris administration is currently working to provide even more support to the nation as it continues to deal with the pandemic and begins to move toward some type of normalcy. The administration has released a $3 trillion economic package to be considered by Congress that would invest in the nation’s infrastructure, help the environment, and fund education and federal workforce-development programs. OPERA America is working to ensure the creative economy continues to be supported during and beyond the current pandemic and to help creative workers get back to work as soon as possible.

This article was published in the Spring 2021 issue of Opera America Magazine.