Senators Klobuchar and Cornyn Demand ‘Immediate Action’ by SBA Over Save Our Stages Delay

Jem Aswad
·6 min read

Almost six months after Congress passed the $16 billion Save Our Stages act into law, less than 100 of the nearly 5,000 struggling independent venues have been approved for relief money, according to its most recent report, released June 9 by the Small Business Administration, which distributes the loans. Venue sources tell Variety that just “a few” have actually received any money.

This shockingly dysfunctional state of affairs — which has included broken websites and reams of bureaucracy, including venue owners being inaccurately informed they had been deemed dead by the SBA’s research —stands in bold contrast to the initial $800 billion Paycheck Protection Program and the more recent $29 billion Restaurant Revitalization Fund, which delivered relief money to businesses within days.

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While the SBA made some long-belated moves last week to improve the situation, shifting management from its Office of Disaster Assistance to a group from its Office of Capital Access, which coordinated PPP and and the Restaurant Revitalization Fund. But venues are closing as they wait for relief money they should have had many months ago.

It took eight months of intense lobbying to pass Save Our Stages — which was authored by Senators Amy Klobuchar and John Cornyn and sponsored by Senate Majority Leader Chuck Schumer and dozens of Congresspeople. And on Tuesday, Klobuchar and Cornyn wrote a letter to SBA chief Isabella Guzman imploring her to “take immediate action to ensure that the relief reaches eligible applicants without further delay.” (The full list of co-signors is listed at the bottom of the letter below.)

While its language is less inflammatory than that of a letter sent by Arizona Congressman Greg Stanton last week — which read in part, “So far, the SBA’s rollout and execution of the grant program has been a disaster … What can I tell [his constituents] to explain why the SBA can’t get it together?” — it doesn’t pull punches in criticizing the SBA’s “insistence on strict compliance,” “unnecessary delays,” “restrictions on communication with grant applicants” and “bureaucratic process.” (Read the letter in full below.)

The Small Business Administration’s ineptitude is actually helping big business: The venues owned by giant corporations like Live Nation and AEG have already begun reopening and putting on concerts, while the small venues that Save Our Stages was designed to protect can’t even reopen until they receive the funds that were passed into law nearly six months ago.

Whether the senators’ letter, or any other effort, will salvage this tragically bungled relief effort before many more venues are forced to close remains to be seen.

June 15, 2021

The Honorable Isabella Casillas Guzman
Administrator, Small Business Administration
409 3rd Street, SW
Washington, DC 20416

Dear Administrator Guzman: The Save Our Stages Act, now the Shuttered Venue Operators Grant (SVOG) program, was created to prevent widespread closures of venues that have been devastated by the loss of revenue due to the COVID-19 pandemic. As supporters of the SVOG program, we urge you to take immediate action to ensure that the relief reaches eligible applicants without further delay.

With each passing day, more independent businesses are forced to shutter permanently or file for bankruptcy. Landlords and banks are no longer permitting deferrals and are pressing for immediate payment of past due accounts; businesses are receiving eviction notices; mom-and-pop businesses are being forced to sell.

It has been nearly six months since Congress passed the Save our Stages Act, nearly two months since the second launch of the program, and [nearly 50] days since the Small Business Administration (SBA) began receiving applications. We urge you to immediately take steps to ensure the funds are distributed to qualified applicants.

The SVOG program is unique, with necessary restrictions built in to ensure taxpayer funding goes only to eligible applicants in need. Under the terms of the law, the SVOG program requires the award of funding to eligible applicants who meet the simple requirements of the program. In this context, the insistence on strict compliance with competitive grant rules has created unnecessary delays in funding. Similarly, restrictions that SBA has placed on communication with grant applicants are unnecessary and have prevented the agency from providing administrative support to individual applicants that could have streamlined the application review process. Bureaucratic process cannot stand in the way of getting these desperately needed funds out the door.

Further delays are unacceptable and would have irreversible consequences for these industries. In an effort to keep our constituents informed and ensure our small businesses receive the support they were promised, we respectfully request you provide us with the following information:

  1. The number SVOG awards that have been approved;

  2. The number of SVOG grants that have been disbursed to recipients;

  3. The amount of SVOG funding that has been disbursed;

  4. The number of applications with holds;

  5. The number of first-priority applicants that have received an award notice;

  6. What SBA is doing to update small business owners on the status of their applications;

  7. What SBA is doing to ensure applicants are not incorrectly associated with similar-named individuals and entities on the List of Excluded Individuals/Entities (LEIE);

  8. What SBA is doing to correct false DNP designation notices sent to thousands of applicants;

  9. SBA’s justification for breaking grant awards, regardless of size, into multiple disbursements; and

  10. SBA’s timeline for subsequent disbursements and what grantees need to do to receive them.

Sincerely,

Senator Amy Klobuchar (D-MN)
Senator John Cornyn (R-TX)

Senators Bill Cassidy (R-LA), Bob Menendez (D-NJ), James Risch (R-ID), Tammy Baldwin (D-WI), Angus King (I-ME), Patty Murray (D-WA), Deb Fischer (R-NE), John Hickenlooper (D-CO), Bill Haggerty (R-TN), Mike Crapo (R-ID), Dick Durbin (D-IL), Jack Reed (D-RI), Rob Portman (R-OH), Ben Ray Luján (D-NM), John Thune (R-SD), Elizabeth Warren (D-MA), Roger Marshall (R-KS), Maggie Hassan (D-NH), Chuck Schumer (D-NY), Marsha Blackburn (R-TN), Patrick Leahy (D-VT), Thom Tillis (R-NC), Richard Blumenthal (D-CT), Chris Van Hollen (D-MD), Steve Daines (R-MT), Ed Markey (D-MA), Tina Smith (D-MN), Mark Kelly (D-AZ), John Boozman (R-AR), Ron Wyden (D-OR), Mitt Romney (R-UT), Chuck Grassley (R-IA), Brian Schatz (D-HI), Sherrod Brown (D-OH), Jon Tester (D-MT), Mike Braun (R-IN), Tammy Duckworth (D-IL), Gary Peters (D-MI), Jacky Rosen (D-NV), Ted Cruz (R-TX), Marco Rubio (R-FL), Bob Casey (D-PA), Maria Cantwell (D-WA), Mark Warner (D-VA), Shelley Moore Capito (R-WV), Kyrsten Sinema (D-AZ), Debbie Stabenow (D-MI), Martin Heinrich (D-NM), Jeff Merkley (D-OR), Joe Manchin (D-WV), Alex Padilla (D-CA), Jeanne Shaheen (D-NH) and Chris Coons (D-DE).

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