What the CARES Act Means to the Creative Community

On March 27, Congress passed and President Trump signed the Coronavirus Aid, Relief, and Economic Security (CARES) Act--the third phase of the federal government’s COVID-19 response. This $2 trillion emergency stimulus package 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.

There are a number of provisions within the CARES Act that artists, cultural workers, independent contractors, and both for-profit and nonprofit businesses can access, including:

Federal Arts and Cultural Funding

• $75 million for the National Endowment for the Arts--40% will be allocated to State and Regional Arts Agencies.
• $75 million for the National Endowment for the Humanities--40% will be allocated to State and Regional Humanities Agencies. 

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

These funds are a supplement to annual appropriations for each agency. 

The NEA announced CARES Act guidelines for the Grant Program here.

Economic Relief for Individual Artists, Culture Workers, and Independent Contractors

• 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 .   
• Check out this snapshot guide, Government Support for Creative Professionals Impacted by COVID-19, from The Arts, Entertainment, and Media Industry Coordinating Committee (AEMI).
• Check out CARES Act Unemployment – Learn how the benefits apply to you from Arts & Business Council of Greater Boston and Volunteer Lawyers for the Arts.
• Read more about Unemployment and Coronavirus from the Massachusetts Department of Unemployment Assistance, including when CARES Act benefits will be available to independent contractors. As of April 17, MA and other states are still awaiting federal guidance on how to distribute the funds. As such, Gov. Baker said the benefits are not available to be applied for as of today and he advised people seeking CARES ACT benefits NOT to apply for them through the current MA unemployment benefits portal, as unnecessary traffic on that website may delay benefits for qualified applicants. Read more on CARES Act unemployment implementation here.

Economic Relief for Arts and Cultural Organizations

• $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 CARES 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.
  • Learn more about these SBA and EIDL loans through The Small Business Owner’s Guide to the CARES Act, created by The U.S. Senate Committee on Small Business and Entrepreneurship.
  • MASSCreative encourages those interested in applying for these SBA and EIDL loans to look up a SBA qualified lender in Massachusetts and contact them for further consultation. 

As of Thursday April 16, 2020 the funds for both the PPP and EIDL programs were exhausted. Congress is working right now on proposals to add additional funds. 

• $5 billion for Community Development Block Grants to cities and counties.
  • MASSCreative encourages nonprofit arts and cultural organizations to contact local government leadership including Mayors, Town Managers, and Select Boards to discuss applying for a Community Development Block Grant. 

We recognize that organizations with more than 500 employees will not qualify for the SBA loan programs. The Massachusetts Work Share Program is a possible resource to investigate.

• Charitable Giving Tax Deduction Incentives 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.

Navigating these Provisions

The Massachusetts Department of Unemployment Assistance is holding a series of Virtual Town Hall presentations on applying for unemployment assistance. As of April 17, MA and other states are still awaiting federal guidance on how to distribute the funds. Gov. Baker advised people seeking CARES ACT benefits NOT to apply for them through the current MA unemployment benefits portal until the benefits are made available.

• Access the step-by-step unemployment assistance presentation or attend a Virtual Town Hall online or by phone here.

Our national arts advocacy partner, Americans for the Arts, hosted a series of webinars for artists and cultural organizations to help navigate through these new federal provisions during this challenging time. 

•  COVID-19 Relief Package Briefing (recording from March 31)
• April 8, 3PM: How the CARES Act Support the Arts Sector (recording from April 8)
  
  To access these recordings, go to the red 'Register' button on the right of the page via the links above)

The National Nonprofit Council hosted a briefing for nonprofit organizations to understand the various provisions of the CARES Acts and what it means for nonprofits.

Federal Coronavirus Relief Bills: What Do They Mean for Nonprofits? (recording from March 31)

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