The eight most terrifying words are “We’re from Washington and we’re here to help.” Notwithstanding the appropriation of billions in revenue, the SBA’s application portal for the Shuttered Venue Operators Grant is still not up and running. This means that at least hundreds of venues that are on the verge of collapse or have collapsed can’t get the money that Congress appropriated, or even apply to get those funds.
Remember, this grant program is not on the magnitude of the Affordable Care Act launch catastrophe or the nonexistent musical works database. The SVOG is a relatively manageable number of potential applicants by comparison. And yet they still can’t get out of their own way. Rest assured, everyone at the SBA will get their paycheck this week, their overhead will be paid for, no problem. And somewhere, someplace in the federal government’s apparatus sits billions of dollars to save our culture. And sits. And sits.
The site was supposed to launch a week ago on April 8 which was itself after months of delay. It’s no wonder the the SBA Inspector General issued a scathing report calling out the organization for mismanagement of the SVOG program–before it even launched.
So you can know two things–there’s no way to know when the money will be paid but there is a way to know that no one–and I mean not a soul–will be held accountable. They can have all the reports they want, but nothing ever happens with these things. They’re from Washington and you can embrace the suck.
As we’ve noted before, the Small Business Administration is seriously behind on opening the application process for the Shuttered Venue Operators Grant program. Turns out we’re not the only ones who are concerned–the SBA Inspector General has issued a damning report on the SBA’s failure to properly staff and administer the billions in funds appropriated by Congress to get venues up and running in the music economy.
The federal assistance directive also specifies that the Director of the Office of Grants Management appoints all grants management officers and makes decisions on the respective warrant level based on the training, qualifications, and experience of the grants officer. However, on March 10, 2021, the acting Chief Operating Officer waived the standard experience, training, and certification requirements and the agency grants training plan for administering all existing and future emergency grant programs related to the impact of COVID-19. SBA established these requirements and the training plan to address the systemic weaknesses OIG found in prior audits of SBA’s grants management.
Currently, the [SVOG] program office has one designated official and its staff are on temporary detail. At this time, SBA has not formalized a plan for staffing this office relative to the volume of applications expected. The agency has also not defined the organizational structure for administering the program.
SBA expects the majority of the awards made under this program to be $1 million or less. Based on the current risk model, these awards would be disbursed as lump-sum advance payments with minimal reporting requirements and agency oversight. It is important that the application reviewing officials use careful scrutiny to review the applicants’ proposed budgets to ensure funds will be used for allowable, allocable, and reasonable expenses. OIG believes that SBA does not have the staff necessary to provide effective oversight over the SVOG program. Insufficient oversight of the SVOG program increases the risk that funds will be misspent, inadequately monitored, or improperly paid.
The Inspector General tends to worry about waste, fraud and abuse, but does it really need to be said that they assume the money is actually paid?
It is incredible that Congress has appropriated the funds but the bureaucracy cannot manage to get the funds through the last mile to the venues that desperately need the money–it’s really beyond desperation. I realize that the stimulus bill was passed immediately before a change in Executive Branch administrations, but that’s really no excuse.
Right now the money is just sitting at SBA and there better be a nice crisp answer for when applications are open and when money is to be disbursed. Applications were supposed to be open today, but the Inspector General’s report strongly suggests that there is not enough staffing available to actually process the applications. Remember–the money for this one comes directly from the SBA.
Austin Rep. Roger Williams, the bill’s House author, issued this statement:
“The SVOG Application opened this afternoon at 12pm ET. I’ve already heard from constituents experiencing issues with the SBA’s application portal, as of this afternoon the SBA temporarily suspended the portal due to technical difficulties.The SBA’s rollout of the SVOG has been torturous for venue operators who were promised relief more than 3 months ago,” said Congressman Williams. “My bipartisan Save our Stages Act authorized the SVOG and was signed into law by President Trump on December 27th. Under the Biden Administration the program has been plagued with delays and mismanagement at every juncture. President Biden failed to put in place capable SBA officials to deliver relief for small businesses and taxpayers in need. Just yesterday, the SBA’s Office of the Inspector General issued a report detailing the Biden SBA’s shortcomings with the SVOG, which hampered the application process and called into question whether the appropriate governance and oversight is in place.
It’s critically important that that the House Small Business Committee address the SBA’s shortcomings. Further delays for eligible business owners are unacceptable. I urge the SBA to make the SVOG a top priority moving forward and President Biden to put qualified individuals into key leadership positions so similar failures will not occur in the future.”