March 20, 2020

Udall, Heinrich, Senate Democrats Call for $4 Billion Stimulus to Protect America’s Creative Economy

Relief package would help sustain arts economy to stem the devastating economic toll of the COVID-19 pandemic

New Mexico arts industry is a $5.6 billion economic engine that supports 1 in 10 jobs

WASHINGTON—Today, U.S. Senator Tom Udall (D-N.M.), ranking member of the Senate Appropriations Subcommittee on Interior, Environment and Related Agencies which oversees funding for the National Endowment for the Ars (NEA), along with Senators Martin Heinrich (D-N.M.), Bernie Sanders (I-Vt.), Tina Smith (D-Minn.), Cory Booker (D-N.J.) and Sheldon Whitehouse (D-R.I.), sent a letter to Senate Majority Leader Mitch McConnell (R-Ky.) and Minority Leader Chuck Schumer (D-N.Y.) calling for a $4 billion economic relief package to America’s creative economy, which is at severe risk because of the COVID-19. The senators are urging Senate leadership to use the NEA as the critical government grant-making organization to sustain the creative economy by disbursing the funds to artists and artisans across the country and ensuring that artists and artisans are eligible for further economic stimulus measures from government agencies such as the Small Business Administration and the Federal Emergency Management Agency. 

“Like many others in the service and tourism industries over the last two weeks, many arts organizations have closed their doors for the foreseeable future. More than one-third of respondents expect to make reductions in staff—26% have already reduced their creative workforce,” the senators wrote, observing that a recent survey calculated $3.2 billion in lost revenue to artists around the country.

“Given that those losses have occurred only in the last two weeks, and current indications from the Center for Disease Control (CDC) and President Trump suggest that social distancing and other measures could extend through the summer, Americans for the Arts anticipates an additional $5-10 billion in potential revenue losses for the nonprofit arts and culture field,” the senators continued. “Therefore, we specifically ask that you provide $4 billion dollars in economic relief funds to the NEA.”

The senators concluded by highlighting several provisions from existing legislation led by Udall, S. 650, the Comprehensive Resources for Entrepreneurs in the Arts to Transform the Economy (CREATE) Act, that would make vital contributions to an effective COVID-19 stimulus.

More information on the CREATE Act can be found here.  

The full text of the senators’ letter is available here and below:

Dear Leader McConnell and Leader Schumer:

We write to express our concern that the 2019 coronavirus (COVID-19) is having a devastating economic impact on America’s creative economy—facing financial losses already estimated to be $3.24 billion nationwide. In a national survey conducted by the Americans for the Arts, 91% of responding arts organizations have cancelled one or more events. We believe the legislative response to COVID-19 economic crisis should include strong funding for the National Endowment for the Arts (NEA), a critical grant making agency that provides support for cultural organizations across America, and provided a similar relief role in the 2009 American Recovery and Reinvestment Act (ARRA). We also believe the economic relief package should include legislative language to ensure that artists and artisans are eligible for assistance through the Economic Development Administration, the Small Business Administration, and USDA Rural Development. 

Like many others in the service and tourism industries over the last two weeks, many arts organizations have closed their doors for the foreseeable future. More than one-third of respondents expect to make reductions in staff—26% have already reduced their creative workforce. The $3.2 billion figure includes revenue losses to date from admissions (ticket sales, subscriptions, memberships), non-admissions income (gift shop sales, sponsorships, contributed income), and unexpected expenditures (new cleaning/disinfecting protocols, adoption of new technologies, cancellation fees). Given that those losses have occurred only in the last two weeks, and current indications from the Center for Disease Control (CDC) and President Trump suggest that social distancing and other measures could extend through the summer, Americans for the Arts anticipates an additional $5-10 billion in potential revenue losses for the nonprofit arts and culture field. The estimates are based on more than 2,000 respondents to an Americans for the Arts survey and then extrapolating those data nationally using IRS data about nonprofit arts and cultural organizations.

Therefore, we specifically ask that you provide $4 billion dollars in economic relief funds to the NEA and consider some of the following provisions from, S. 650, the Comprehensive Resources for Entrepreneurs in the Arts to Transform the Economy (CREATE) Act to be included in any economic stimulus related to COVID-19.

- Expanding programs at the Small Business Administration (SBA) to increase microloans, business loans, and technical assistance for artists (Secs. 101, 102, and 103).

This provision would ensure that artists and arts entrepreneurs have access to microlending, that loan criteria doesn’t discriminate against loans for arts-related business, and that business technical assistance targeted toward the specific needs of artists is increased.

- Ensuring access to FEMA's disaster relief assistance for artists impacted by natural disasters (Sec. 107).

This provision would correct this regulatory discrepancy and allow self-employed workers the same access to FEMA’s disaster assistance program as workers who are employed by others. 

- Requiring the Economic Development Administration (EDA) ensure that traditional economic development tools, such as incubators and grant programs, support the creative economy throughout the country (Sec. 104) 

This provision better ensures support for the arts economy through traditional economic tools, like incubators and economic development planning. 

- Expanding the U.S. Department of Agriculture's (USDA) Rural Development Administration to include arts-focused economic development (Sec. 105)

This provision better ensures support for the arts economy through traditional economic tools, like those under USDA‘s rural programs.

The CREATE Act was crafted to ensure that artists and arts entrepreneurs are eligible for existing federal programs to better support the creative economy. Therefore, we ask that you give this proposal strong consideration.

Sincerely,