Even as Phoenix Music Venues Reopen, They're Still Dealing With Funding Challenges

Even as Phoenix Music Venues Reopen, They’re Still Dealing With Funding Challenges

In fall 2020, Phoenix New Times spoke with several Valley promoters and venue owners to understand the larger effects of COVID-19. Across the board, these stakeholders shared a sense of frustration, careful optimism, and genuine anguish as they stared down the barrel of a year-long closure.

Now, some seven months later, we’ve circled back with several owners, and while there’s clearly a greater sense of optimism these days, each interviewee explained that we’re not yet out of the woods.

“It’s been a very long several months,” says Stephen Chilton, who owns The Rebel Lounge and operates Psyko Steve Presents. “And it’s going to be a long, long several months for venues and promoters to get organized.”

In December, after months of uncertainty and bureaucratic back-and-forth, help seemed to arrive when the Save Our Stages Act was finally passed. The program, which promised some $16 billion in assistance, was reorganized as part of the Shuttered Venue Operators Grant. That grant is available not only for concert venues but also museums, movie theaters, and “talent representatives.”

Chilton says upon its announcement, the SVOG program seemed to have an immediate effect.

“I was tracking venues closing all last year, and by last fall, it was just an avalanche of venues closing, like we were at a cliff,” he says. “But starting in December, since the bill passed, we haven’t seen very many venues close.”

It’s because of this very momentum that Chilton and other local owners/operators, including Brannon Kleinlein of Last Exit Live and Rhythm Room’s Bob Corritore, immediately filed for assistance.

“People have been able to borrow money or empty retirement accounts or savings knowing that these funds are how they’re going to get out of that hole,” Chilton says.

However, beyond some initial optimism, there have been real challenges faced by applicants. The U.S. Small Business Administration, which handles the SVOG program, has effectively dropped the ball on both approvals and fund dispersal, according to several metro Phoenix venue owners/promoters.

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French band Caravan Palace performs at Crescent Ballroom in June 2016.

Jim Louvau

It’s not just that the SVOG website crashed on day one. (Chilton, who serves as a board member for the National Independent Venue Association, says the SBA received 3,000-plus applications that first day.) Or, as Corritore explained, that the process took “over seven hours” to complete, and that this grant doesn’t cover everything as outlined within SOSA. It’s also a prevailing sense of disrespect experienced by owners.

“They were telling us it was taking so long for the application to be available because, ‘Hey, we want to do it right.’ Well, they didn’t get it right,” says Kleinlein. “It was another two weeks before we could apply again. It’s a slap in the fucking face, really, for music venues.”

A subsequent blow, Kleinlein says, came when the SBA provided what he calls preferential treatment to the country’s restaurant industry.

“Then, while we’re still sitting here waiting, they roll out the Restaurant Revitalization Fund, which [involves] less red tape,” he says. “It covers breweries, bars, and taverns; you don’t have to have food. Most venues would qualify.” (Per QSR Magazine, the RRF, which closed to applications in mid-May, has its own problems, as 362,000 applicants, applying for total funding of $75 billion, vie for the $28.6 billion available.)

Kleinlein says that the lack of “priority” afforded to live venues likely had everything to do with the influence of the restaurant industry.

“The restaurant lobbyists have been around for a long time, and there’s a lot of money behind [them],” he says. “So, is it a coincidence that [the RRF] came out? And that it was easier to apply for and had a better funding system? I don’t think it is.”

Chilton commented about the relationship between these sectors, highlighting how funding one over the other seemed counterintuitive.

“The restaurants were like, ‘Wait, we get our business when there’s events,’ and so the restaurants are struggling because the venues near them aren’t open,” he says. “You just start to realize how much of these other businesses are driven by ours.”

Kleinlein noted that the distinction between SVOG and the RRF funds also gave owners/operators a difficult choice to make when applying for assistance.

“Is the payout formula [for the RRF] better than it was with [SVOG]?,” he says. “It’s put everybody in a position of, ‘Okay, which one do I apply for? If I apply for [SVOG], and that ends up running out of funds, then I don’t get into the restaurant one.’

“If it sounds like I’m frustrated, it’s because I am.”

A shot of Brandon Decker at Last Exit Live.EXPAND

A shot of Brandon Decker at Last Exit Live.

Luxicon Photography

These “blows” are seen as a continuation of struggles from the early days of closure. Owners continued to struggle with communicating venues’ unique value to lawmakers. Chilton says the SBA has “never done something like this, and it’s an industry the SBA doesn’t really understand.” Chilton and others, though, did thank local representatives like Greg Stanton and Kyrsten Sinema for their combined efforts.

Meanwhile, Joel Goldenthal, the CEO of The Nash, says that while livestreams initially proved promising, they quickly reached their utility, adding, “It was very effective in accomplishing what we set out to do for six months. Then it just got to the point where it’s literally zero.”

Even with these issues, owners remain hopeful as the SVOG further rolls out. As Broadway News reported on May 26, the SBA sent out acceptances to select venues, with the plan to disperse funds for venues which lost at least 90 percent of their revenue. Then, 14 days later, funds will be dispersed for those venues which lost 70 percent or more. In a text from May 30, Chilton says he only knew a “few [venues] so far getting approval,” though none in Arizona, with more announcements planned in early June.

“We’re in limbo,” Kleinlein says. He adds that while he is among those owners who lost 90 percent or more —Goldenthal says The Nash saw 95 percent of their revenue slashed — so too are most venues nationwide, potentially fostering added competition for limited funds.

In fact, as Kleinlein and several other owners mentioned, the aid may also present some challenges.

“So all it’s going to be able to do is just dig us out of a hole a little bit, and probably not even all the way,” Kleinlein says. “For places like myself, we were able to work something out with the landlord where I wasn’t open and I could defer payment to a later time. Well, now that I am open, rent is due.”

Regardless, venues are looking forward to their reopenings this summer and fall.

The Nash, which has a “soft open” in June, will roll out more shows starting in July. Chilton says he’ll start promoting shows in September and October. The Rhythm Room, says Corritore, plans to reopen September 1. Last Exit Live, which started presenting shows in early May, will “run three to four shows weekly” through September/October. In a statement from its PR firm, Live Nation said The Van Buren will announce its expanded calendar in the near future.

The Rebel Lounge's always entertaining marquee.EXPAND

The Rebel Lounge’s always entertaining marquee.

The Rebel Lounge/Facebook

With just a few months to go, owners/operators are already hard at work in reopening. Aside from staffing concerns expressed by venues, Charlie Levy, who owns Valley Bar and Crescent Ballroom, noted that it’ll be “close to opening as if from day one,” with logistical issues like inventory and promotions to address after extended closures. There’s also the challenge of simply booking shows.

“It’s hard to do last-minute planning in this business,” Chilton says. “If I don’t book something on a Friday at least two months out, I don’t have an event on that Friday.” However, Chilton quickly added that he’s “never booked as much so far out as I am right now,” with shows set for spring 2022.

All of this planning, Corritore says, potentially ignores one distinct possibility.

“What would be a real spoiler is if there was another spike in the pandemic,” he says. “If all of a sudden there’s a danger of working ahead, then all that goes away. So all of this, all the parts, are dependent.”

Levy echos a similar sentiment. He says that while Crescent and Valley Bar’s summer/fall slate is expected to happen, he “can’t see the future, so I don’t make guarantees.”
But most venues seem intent to strive onward regardless. That momentum speaks to the renewed sense of community that venues experienced amid COVID. Corritore, Levy, and Kleinlein each applauded Chilton for working with NIVA on behalf of Arizona’s venues.

It’s not just a feel-good affair; this sharing of resources may have helped the Valley’s scene remain afloat. Chilton says that of the closed venues nationwide — last year, NIVA estimated that 1,000 venues could shutter (per Rolling Stone) — Arizona “all but escaped; I can only think of two venues that closed during all this.” (Club Red shuttered in March, while The Lunchbox is “likely gone for good.”)

Many venue promoters aren’t set on just plotting out the next few months. Whereas Last Exit Live, Crescent Ballroom, and Rebel Lounge are looking forward to returning to some level of “normalcy,” The Nash’s staff have reevaluated their approach. Their return shows in June are the start of a brand-new “diminished capacity,” a decision that reflects a trend of industry-wide post-COVID changes.

“We sold jazz as an intimate art form,” Goldenthal says. “But all the things we had as selling points could potentially bite us coming up. So we’re getting ahead of to make people feel more comfortable coming back in.”

Most venues, however, seemed focused on bigger plans, like further growing the Valley as a concert destination. Both Chilton and Kleinlein said that summer 2022 could not only mark a full return, but added touring and demand for shows could even counter Arizona’s historically slow summer concert season.

“I do think that 2022 is going to be a completely stacked year,” Kleinlein says. “I think there’s going to be more shows to go around and hopefully that provides the opportunity for us to have more shows. Maybe we can get to six, seven nights a week of being open. It will be the busiest year for the industry in the last 10 years.” 

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