Senator Portantino’s Nonprofit Theater Bill Headed to Governor’s Desk
For Immediate Release: August 30, 2022
Contact: Lerna Shirinian, (818) 409-0400
Senator Portantino’s Nonprofit Theater Bill Headed to Governor’s Desk
Sacramento, CA - Senate Bill 1116, a measure authored by Senator Anthony J. Portantino (D – Burbank) which seeks to create a payroll fund to support small nonprofit performing arts venues (SNPAOs), passed the Senate Floor today and is headed to the Governor’s desk for signature. The effort comes at a time when small community theatres are struggling in the aftermath of the pandemic.
“Our vibrant arts community drives much of California’s creative economy. Despite strong community support, neighborhood theaters have suffered from under-investment and COVID-19 shutdown impacts,” stated Senator Portantino. “Investment in the arts helps all generations of Californians. In many cases, local theatres introduce young people to the arts and create opportunities for excellent careers with living wages. I look forward to the Governor’s support in sustaining our creative work force.”
Prior to the pandemic, California ranked 28th in state arts funding on a per capita basis. This chronic long-term underfunding of the industry amounted to a double-hit when the pandemic shut down much of the live arts. Johns Hopkins University reports that, as of October 2021, the percentage of job losses at nonprofit arts organizations remains more than three times worse than the average of all nonprofits.
SB 1116 establishes the Equitable Payroll Fund (EPF), a grant program designed to support live performances – and workers directly – by providing substantial reimbursements of payroll expenses. This program will support jobs for anyone hired as an employee by a SNPAO, including both production and non-production employees and administrative staff. It does not apply to independent contractors who qualify as such under the ABC test set out in the Dynamex decision and codified by AB5.
“California’s live arts industry - and the thousands of workers who fuel it - has still not fully recovered from the COVID shutdown, which exacerbated decades of underinvestment in the arts,” said Kate Shindle, President of Actors’ Equity Association. “The live arts are a huge economic driver in communities across California. SB 1116 came together after a long, intense, unprecedented, and productive collaboration between workers and our small nonprofit employers, and will ensure that taxpayer dollars support fair wages, safety and benefits. At the same time, the structure of this bill incentivizes growth and sustainability for nonprofit employers. I’m grateful for the leadership of Senator Portantino, who brought this innovative bill to the floor for a vote, and hope that Governor Newsom will sign it without delay.”
The EPF will begin to stabilize SNPAOs immediately; preventing more closures and helping these organizations grow quickly to self-sustainability. The EPF will provide the greatest percent reimbursement to the smallest organizations. Since labor costs in the performing arts are relatively flat, these historically underfunded organizations are the hardest hit and most at risk. As SNPAOs grow, the percentage of payroll expenses that is reimbursed decreases as organizations are better able to absorb these costs. When an SNPAO reaches $2M, they graduate out of the program.
“Small performing arts organizations are incubators for talent and imagination. This creativity fuels innovation in our communities and our creative industries, and lifts up our sense of who we are as Californians,” said Martha Demson, Board President of the Theatre Producers of Southern California. “Sadly, these vital organizations are facing overwhelming challenges that are threatening to shut down California's SNPAOs permanently. The Equitable Payroll Fund is an innovative program, which offers SNPAOs a solution for today's existential crisis and a pathway to a sustainable future. Much like film industry tax credits, the EPF is designed to help retain jobs and support equitable work opportunities for tens of thousands of creative workers each year. We are grateful to Senator Portantino for championing this important solution to a looming crisis in our community.”
###
