Report questions Covid payouts to stars

A raft of major artists including Post Malone, Lil Wayne and Chris Brown received some $200 million in payouts from a government-backed scheme intended to provide “emergency assistance” to US live entertainment businesses during the Covid-19 pandemic.

In December 2020, the US Congress passed the Save Our Stages bill to provide around US$15bn in Small Business Administration grants to independent music venues, museums, booking agencies, movie theatres and other institutions.

However, a new report from Insider revealed that a number of world-renowned artists – some of whom are not from the US – were awarded grants of up to $10m while, reportedly, the maximum relief money many venue owners received was $100,000.

Artists that reportedly benefited from the grants include Chris Brown ($10m), Steve Aoki ($9.9m), Lil Wayne ($8.9m),  The Smashing Pumpkins ($8.6m), Vampire Weekend ($8.3m), Korn ($5.3m), Melissa Etheridge ($3.9m), Usher ($3.1m), Common ($2.8m), Portugal. The Man ($2.25m), Becky G ($2.2m), Leann Rimes ($2m), Nickelback ($2m), Father John Misty ($1.7m) and Slipknot ($1m) for their music festival, Knotfest.

The report notes that many of these artists own or may have owned businesses or corporations that could qualify for such grants, such as Aoki’s corporation, DJ Kid Millionaire Touring Inc., which reported four full-time employees on its application for a $71,000 Paycheck Protection Program (PPP) loan.

Industry sources contacted by Insider defended the programme, pointing out that many artists typically contract with hundreds of sound and lighting technicians, costumers, drivers, security personnel, and other freelancers when they put together a tour. All those contractors were out of work during the lockdowns, the sources said, and artists applying for grants could have used the money to help keep them afloat. But there was no requirement that they spend the money that way.

An anonymous live music professional close to the programme told IQ, “Unlike the PPP, you do have to attribute costs to a specific cause, so [successful grant applications] have to show that the money was spent in accordance with the grant.”

A number of world-renowned artists – some of whom are not from the US – were awarded grants of up to $10m

The programme’s oversight of contractors was addressed by behemoths of the live music industry, who formed a coalition to petition the US government to expand the Save Our Stages act to include live event workers.

While it is unclear which artists applied for grants themselves, it may have been done by a third party, as the article notes: “A single financial-management firm in Los Angeles [NKSFB, which represents artists including Post Malone, Chris Brown, Steve Aoki, Marshmello, and Lil Wayne] successfully submitted grants on behalf of 97 artists, venues, and managers, amounting to more than a quarter of a billion dollars in grant payouts.”

The report also notes that two businesses partly owned by veteran manager Irving Azoff, whose firm’s clients include the Eagles, Lizzo, Harry Styles, and Gwen Stefani, together received $17.5m from the programme.

Similarly, venues affiliated with Live Nation, which was specifically stated to be excluded from Save Our Stages, received some $19m in funding from the programme, according to Variety last year, though a rep told Insider that the company has “no ability to control whether its subsidiaries access aid programmes”.

Today’s news comes a year after more than 60 lawsuits were filed against the Small Business Administration by companies who said they were unfairly denied millions in relief.

According to the aggrieved venues, SBA has refused their requests without good reason or a proper explanation, putting particular companies at a huge disadvantage over rivals who have received aid. Attorneys involved in the cases claim that rates of refusal under SVOG “significantly exceed typical government grant programmes.”

A spokesperson for the SBA told Insider: “The programme helped save thousands of entertainment venues and operators across the country during the Covid-19 pandemic. Nearly half the grant money went to businesses with fewer than five full-time employees, the smallest of small businesses.”

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