Local music venues join national push for federal assistance

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The night of March 11 was the last time an audience filled the seats of downtown Milwaukee’s Pabst Theater.

It was the final show of comedian Dave Chapelle’s two-day tour stop, and Gary Witt, co-owner and chief executive officer of The Pabst Theater Group, sat back stage while what felt like the earth crumbled around him. The novel coronavirus pandemic had arrived and the country was in panic mode.

Since mid-March, the Milwaukee-based entertainment group has canceled more than 200 shows between its four now-shuttered venues, returning hundreds of thousands of dollars worth of tickets, while finding a way to continue paying 45 full-time and 200 part-time employees.

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“In the beginning, we were playing defense,” Witt said. “Every day there was something new and something we never heard of before, and we were in situations that were just so unique that we had never dealt with before.”

But as soon as there was word of disaster relief from the federal government through the $2.2 trillion coronavirus relief package, Witt and his team started to take an offensive approach to the crisis.

Witt joined forces with other independent music venues across the country such as The Troubadour in Los Angeles, Preservation Jazz Hall in New Orleans and First Avenue in Minneapolis and, together, formed the National Independent Venue Association, “basically to fight for the survival of independent venues themselves,” he said.

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Over the past couple of weeks, NIVA has grown membership to 1,000 venues in 48 states, elected a board, and hired Washington D.C.-based lobbying firm Akin Gump Strauss Hauer & Feld LLP for representation at the federal and state level.

Last week, NIVA sent a letter to Congress outlining their request: modify the existing Paycheck Protection Program to accommodate shuttered businesses, relieve tax burdens through credit and deferral, continue funding for unemployment insurance, forgive mortgage and rent payments until operations are fully restored, establish a business recovery fund and national guidelines for safely reopening.

Witt said the group also functions to educate leaders and lawmakers about the cultural and economic impact independent venues have on their communities. Pabst Theater Group alone generates about $200 million in annual revenue to the Milwaukee area with more than 700 shows a year.

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According to NIVA, for every $1 spent on a ticket at a small venues, a total of $12 in economic activity is generated within communities on restaurants, hotels, taxis, and retail establishments.

“Even though they all know their favorite music and their artists that perform when they go to concerts, they didn’t know that in addition to being made up of a couple of large corporations, the majority of the business is actually made up of independent venues,” Witt said.

NIVA’s requests are not unlike those made recently by the Independent Restaurant Coalition, which has especially pushed for amendments to the PPP on behalf of 500,000 independent restaurants across the U.S.

The PPP was depleted of its $350 billion in funding in less than a week, but an additional $310 billion has been allocated for the program, and the SBA today resumed accepting loan applications for the PPP program.

The PPP loan is totally forgivable under the conditions that 75% of the funds are used for payroll expenses for an eight-week period.

That’s a tough pill to swallow for Wisconsin’s nonessential businesses like restaurants, music venues and some retailers that are shut down until May 26 under Gov. Tony Evers’ extended Safer at Home order, and as a result, don’t have much work to give employees.

But restaurants are still able to keep cash trickling in with limited operations while music venues have been forced to shut down completely, said Witt.

“We’re the first to close and very likely the last to open,” he said. “Restaurants will open piece by piece… I don’t think we’ll be doing a large concert for quite some time.”

The Pabst Theater Group is joined by a number of independent venues across the state as members of NIVA, including the Cactus Club, The Cooperage, The Miramar Theatre and The Rave/Eagles Club, all located in Milwaukee, and the Sharon Lynne Wilson Center in Brookfield, as well as the Barrymore Theatre in Madison, Big Top Chautauqua in Bayfield and Chippewa Valley Theatre Guild in Eau Claire.

The Cactus Club in Bay View was among the first Wisconsin venues to join, said owner Kelsey Kaufmann, who purchased the bar and music venue in February from longtime owner Eric Uecke.

She had first heard about the association from Justin Kantor, a New York venue operator and founder of booking and ticketing software startup Venue Pilot. He had been a helpful resource to Kaufmann during the ownership transition and reopening of Cactus Club, and encouraged her to join NIVA.

“Without thinking twice, I signed up,” Kaufmann said.

She later found out that Gary Witt was one of its founding members.

“It’s exciting to get folks that otherwise work in such isolation together having these important conversations because more often than not, people are coming at it with a similar sense of conviction and interest in the artistry behind it,” she said. 

Kaufmann said the group is a good starting point for efforts to support independent venues through the COVID-19 shutdown.

Cactus Club, which has been closed since March 15, was denied federal assistance through the CARES Act due to the timing of its ownership change and restructuring earlier this year, but securing a loan from Small Business Administration’s Paycheck Protection Program is still a possibility.

Kaufmann said it’s impossible to quantify how much revenue has been lost due to COVID-19. Unlike many venues, nearly all of Cactus Club’s ticket sales goes directly to the artists.

“There are many tiers for live entertainment and live music, but at this tier, it feels really important (for ticket revenue) to center the performing artists who are responsible for bringing the people in,” said Kaufman, adding that it’s difficult to determine the long-term impact the shutdown will have on the space and the local music industry.

During its temporary closure, Cactus Club has launched a collaborative music video project, which includes work from local musicians, youth artists and established filmmakers. Last week, the venue soft-launched its web store, which sells handmade Cactus Club candles, stickers and other merchandise.

It has also set up a GoFundMe campaign to help cover operational fees and support its employees.

“It’s a time for a space like Cactus Club, which is scrappy and resourceful, to try and bring people together,” Kaufmann said. 

Get more news and insight in the April 27 issue of BizTimes Milwaukee. Subscribe to get updates in your inbox here.

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