[House Hearing, 117 Congress] [From the U.S. Government Publishing Office] THE POWER, PERIL, AND PROMISE OF THE CREATIVE ECONOMY ======================================================================= HEARING BEFORE THE COMMITTEE ON SMALL BUSINESS UNITED STATES HOUSE OF REPRESENTATIVES ONE HUNDRED SEVENTEENTH CONGRESS SECOND SESSION __________ HEARING HELD JANUARY 19, 2022 __________ [GRAPHIC NOT AVAILABLE IN TIFF FORMAT] Small Business Committee Document Number 117-043 Available via the GPO Website: www.govinfo.gov __________ U.S. GOVERNMENT PUBLISHING OFFICE 46-711 PDF WASHINGTON : 2022 ----------------------------------------------------------------------------------- HOUSE COMMITTEE ON SMALL BUSINESS NYDIA VELAZQUEZ, New York, Chairwoman JARED GOLDEN, Maine JASON CROW, Colorado SHARICE DAVIDS, Kansas KWEISI MFUME, Maryland DEAN PHILLIPS, Minnesota MARIE NEWMAN, Illinois CAROLYN BOURDEAUX, Georgia TROY CARTER, Louisiana JUDY CHU, California DWIGHT EVANS, Pennsylvania ANTONIO DELGADO, New York CHRISSY HOULAHAN, Pennsylvania ANDY KIM, New Jersey ANGIE CRAIG, Minnesota BLAINE LUETKEMEYER, Missouri, Ranking Member ROGER WILLIAMS, Texas JIM HAGEDORN, Minnesota PETE STAUBER, Minnesota DAN MEUSER, Pennsylvania CLAUDIA TENNEY, New York ANDREW GARBARINO, New York YOUNG KIM, California BETH VAN DUYNE, Texas BYRON DONALDS, Florida MARIA SALAZAR, Florida SCOTT FITZGERALD, Wisconsin Melissa Jung, Majority Staff Director Ellen Harrington, Majority Deputy Staff Director David Planning, Staff Director C O N T E N T S OPENING STATEMENTS Page Hon. Dean Phillips............................................... 1 Hon. Blaine Luetkemeyer.......................................... 3 WITNESSES Mr. Carson Elrod, Co-Founder & Co-Leader, Be An #ArtsHero, Director of Government Affairs, Arts Workers United, Brooklyn, NY............................................................. 5 Ms. Nataki Garrett, Artistic Director, Oregon Shakespeare Festival, Ashland, OR.......................................... 7 Ms. Sandra Karas, Secretary-Treasurer, Actors' Equity Association, New York, NY...................................... 9 Ms. Raeanne Presley, Co-Owner, Presleys' Country Jubilee (Presleys' Theater), Branson, MO, testifying on behalf of the National Independent Venue Association (NIVA), Plains Chapter, in her role as Secretary....................................... 10 APPENDIX Prepared Statements: Mr. Carson Elrod, Co-Founder & Co-Leader, Be An #ArtsHero, Director of Government Affairs, Arts Workers United, Brooklyn, NY............................................... 37 Ms. Nataki Garrett, Artistic Director, Oregon Shakespeare Festival, Ashland, OR...................................... 57 Ms. Sandra Karas, Secretary-Treasurer, Actors' Equity Association, New York, NY.................................. 60 Ms. Raeanne Presley, Co-Owner, Presleys' Country Jubilee (Presleys' Theater), Branson, MO, testifying on behalf of the National Independent Venue Association (NIVA), Plains Chapter, in her role as Secretary.......................... 63 Questions and Answers for the Record: Questions from Hon. Troy Carter and Answers from Mr. Carson Elrod...................................................... 68 Question from Hon. Troy Carter and Answers from Ms. Sandra Karas...................................................... 77 Additional Material for the Record: Ann Marie Miller Letter...................................... 78 Bean Gilsdorf Letter......................................... 80 Brian McClean Letter......................................... 81 Brian Marquis Letter......................................... 82 Christin Crampton Day Letter................................. 83 Craig Coogan Letter.......................................... 85 Damon Grant Letter........................................... 86 David HB Drake Letter........................................ 88 Deborah Stewart Letter....................................... 90 DPE AFL-CIO AEMI DEI Policy Agenda........................... 91 DPE - Department for Professional Employees, AFL-CIO Letter.. 93 Emma Goidel Letter........................................... 96 Emmi S. Herman Letter........................................ 98 Gabe Long Letter............................................. 99 Gwenn Seemel Letter.......................................... 100 Hattie Schapiro Letter....................................... 101 J. Murphy Letter............................................. 102 Jacob Harvey Letter.......................................... 103 Jacqueline K. Dace Letter.................................... 104 Janet Mullet Letter.......................................... 105 Jay Dunn Letter.............................................. 106 Jayeesha Dutta Letter........................................ 107 Jorge Delara Letter.......................................... 108 Joshua T. Bennett Letter..................................... 114 Kate Robin Letter............................................ 115 Kerri Wood Einertson Statement............................... 117 Lily Kephart Letter.......................................... 121 Lora Bottinelli Letter....................................... 122 Mara Jill Herman Letter...................................... 124 Rachael Viscidy Letter....................................... 125 San Francisco Mayor London N. Breed, Chicago Mayor Lori E. Lightfoot and Philadelphia Mayor Jim Kenney Statement...... 126 Sarah Schulz Letter.......................................... 129 Susan Parks Letter........................................... 130 Vella Lovell Letter.......................................... 131 William Baxter Letter........................................ 133 Winnie Holzman Letter........................................ 134 Abigail Engstrand Letter..................................... 135 Alex! Jimenez Letter......................................... 137 Alice Klugherz aka wonderland/wizehart Letter................ 138 Amanda Andrews Letter........................................ 140 Americans for the Arts....................................... 141 Andy Gaines Letter........................................... 159 Aria McKenna Letter.......................................... 160 Arts Alliance Illinois....................................... 161 Arts in a Changing America................................... 162 Arts Management.............................................. 164 Arts of the Bering Strait Region............................. 166 Arts Workers United.......................................... 186 Authors Guild................................................ 282 Beth Jucovy Letter........................................... 291 Blue Star Contemporary....................................... 292 Brooke Smiley Letter......................................... 294 Byron Lenair Letter.......................................... 295 Carnegie Hall Corporation.................................... 296 Craft Emergency Relief Fund.................................. 300 CONTRA-TIEMPO................................................ 306 Dance/NYC.................................................... 307 Dance/USA.................................................... 316 Denise G. Johnson Letter..................................... 319 Denver Arts & Venues......................................... 320 Dia Scott Letter............................................. 321 Elizabeth Miller Letter...................................... 322 Eric Ragan Letter............................................ 323 Georgia Kung Letter.......................................... 325 Georgy Rock - Story Lady Letter.............................. 326 Get Creative Workers Working Coalition....................... 327 Jack Becker Letter........................................... 413 Jeanie Bergen Letter......................................... 414 Jessica Snow Letter.......................................... 415 John Kristiansen New York, Inc. Letter....................... 416 Kady Yellow Letter........................................... 420 Winifred Helton-Harmon Letter................................ 422 Krys Holmes Letter........................................... 423 League of American Orchestras................................ 424 League of Wisconsin Municipalities........................... 428 Lesley Currier Letter........................................ 429 Lexie Peveto Letter.......................................... 430 Linda Storm Letter........................................... 438 Lucy Yeghiazaryan Letter..................................... 439 Mallory Portnoy Letter....................................... 440 Massachusetts International Festival of the Arts............. 441 Michael Grasso Letter........................................ 443 New Yorkers for Culture & Arts............................... 444 Nicolette McDermott-Ketchum Letter........................... 449 OPERA America................................................ 451 Pam Breaux Letter............................................ 454 Potri Ranka Manis Letter..................................... 457 Rachel Austin Letter......................................... 459 Ragan Rhodes Letter.......................................... 460 Recording Academy............................................ 462 Robin Bronk Letter........................................... 466 Society of Composers & Lyricists............................. 468 Sophie Peyton Letter......................................... 471 Steven Kidd Letter........................................... 472 Taurie Kinoshita Letter...................................... 475 Texas Folklife............................................... 476 Texans for the Arts.......................................... 478 Thea Martinez Letter......................................... 480 Theatre Communications Group................................. 481 West Baltimore Re-Imagining and Redevelopment Project........ 485 WESTAF and the Western Arts Advocacy Network................. 489 Wise Fool New Mexico......................................... 492 THE POWER, PERIL, AND PROMISE OF THE CREATIVE ECONOMY ---------- WEDNESDAY, JANUARY 19, 2022 House of Representatives, Committee on Small Business, Washington, DC. The committee met, pursuant to call, at 10:00 a.m., in Room 2360, Rayburn House Office Building and via Zoom, Hon. Dean Phillips [member of the Committee] presiding. Present: Representatives Phillips, Golden, Mfume, Delgado, Craig, Davids, Newman, Bourdeaux, Chu, Evans, Houlahan, Kim of New Jersey, Luetkemeyer, Williams, Stauber, Meuser, Tenney, Garbarino, Young Kim of California, Van Duyne, and Fitzgerald. Mr. PHILLIPS. Good morning. I call this hearing to order. Without objection, the Chair is authorized to declare a recess at any time. And I would like to begin as we always do now to note some important requirements. Let me begin by saying that standing House and Committee rules and practice will continue to apply during remote proceedings. House regulations require the Members to be visible through a video connection throughout the proceeding, so please keep your cameras on and remain muted until you are recognized to minimize background noise. In the event a Member encounters technical issues that prevent him or her from being recognized for their questioning, I will move to the next available Member of the same party and I will recognize that Member at the next appropriate time slot provided they have returned to the proceeding. Should a Member's time be interrupted by technical issues, I will recognize that Member at the next appropriate slot for the remainder of their time once their issues have been resolved. In the event of technical issues, I may need to recess the proceedings to address them. And with that, let's turn to today's business. I want to thank all of our witnesses for being here today. It is a pleasure to have such a talented and accomplished group of witnesses representing the arts sector. As you can see, I am sitting in for Chairwoman Velazquez, who was unable to Chair this hearing today. The arts sector, an important sector, employs nearly 5.2 million Americans and contributes $919 billion to our national economy. In my congressional district, the influence of the creative economy is all over the place. Writers, photographers, musicians, and designers launch small businesses, employ workers, and help Minnesota make it great through their art. But the impact of the arts economy is not confined to America's largest cities. It is evident in every part of the country. America's 675,000 art-centered businesses are present in every congressional district throughout the nation. Unfortunately, the pandemic has touched nearly every business in the arts economy. Creative businesses and workers usually rely on in-person gatherings and live events to sustain their enterprises. However, as the virus spread throughout the country, lead Americans to stay home and socially distance. Ninety-nine percent of entertainment productions canceled events throughout the pandemic so far, resulting in a loss of $557 million in ticketed admissions alone. At the height of the pandemic, 63 percent of creative workers experienced unemployment and 95 percent lost creative income. The live events industry is a crucial component of the creative economy that has struggled greatly throughout the pandemic. This industry comprises not only theatres and music venues, but also musicians and performers and those that support live events such as planners, caterers, designers, and so much more. These workers and small businesses have seen precipitous declines in revenue due to the ongoing COVID-19 pandemic and related public health concerns, with countless events and gatherings being canceled or delayed for now the third year in a row. To help mitigate the impact of the pandemic on this industry, Congress created the Shuttered Venue Operators Grant program, known as SVOG, as many have come to know it. To date, the program has delivered over $13 billion in grants to struggling venues throughout the country. This funding has helped many businesses, including several in my district, avoid permanent closure. However, SVOG was not accessible to the many independent contractors and small business owners that comprise the broader live events industry, leaving them totally out in the cold. Last August, I held a listening session with business owners in the live events industry in Minnesota and heard heartbreaking stories of dreams delayed and hardships faced. And 5 months later, Congress has yet to take action. It is crucial that we pass additional small business targeted relief to help those small businesses most impacted by the growing ongoing pandemic, including those in the live events industry itself. These funds would help business owners keep their doors open and workers employed, and it would help strengthen our economic recovery as well with the understanding that arts and culture are the second-highest sector for value added per dollar in the United States' economy. It is important to note as well, the benefits of the arts go well beyond economic. They have a substantial impact on our country's social, civic, and cultural well-being. Alongside preserving and celebrating culture, research shows that as creative and artistic enterprises arise, ancillary businesses are more likely to form around them, creating jobs and stimulating local economies. But the wounds the pandemic inflicted on the arts economy are deep and painful and potentially long lasting. If we want the industry to return to pre-COVID trends and continue to be an economic engine for local communities, these businesses need more support and investment. Investing in the creative economy will help this crucial sector recover while also fueling overall economic growth for the United States. So today, I hope this hearing allows us to examine the challenges that those operating in the creative economy continue to face. I also look forward to discussing policies that can help support this important sector to all of us. With that, I would like to yield to the Ranking Member, Mr. Luetkemeyer, for his opening statement. Mr. LUETKEMEYER. Thank you, Mr. Chairman. And I appreciate you filling in for the Chairwoman this morning. As COVID-19 continues to disrupt daily lives, we have seen Americans double down on their cultural and creative consumption to regain a sense of normalcy. In addition to the creative arts ability to provide individuals with comfort, joy, and even hope during the challenging times, the arts can also ignite economic growth and recovery after hardship strikes. Creative organizations and enterprises are revenue and job generators not only within their immediate sphere but also act as a catalyst, stimulating economic activity in adjacent sectors such as tourism, hospitality, transportation, restaurants, and many others. Culture and the arts are not confined only to metropolitan areas. In fact, rural and heartland communities also have their own significant reservoirs of homegrown creative assets that can be mobilized for social, cultural, and economic good. Nationwide, the creative economy generated an impressive 4.3 percent of our nation's gross domestic product, or $919.7 billion in 2019. The creative arts employed nearly 5.2 million workers prior to the pandemic, accounting for nearly 3.3 percent of the United States' workforce. Unfortunately, this industry has not been immune to the COVID-19 crisis. During the worst of the pandemic, nearly all entertainment events were canceled creating significant financial losses across the board of businesses themselves, local governments, and adjacent businesses reliant on their success. At the same time, employment in this sector plunged, and while there has been some increase, workers in the creative arts sphere remain among some of the most heavily affected with 11 percent more unemployment rates than compared to pre- pandemic levels. 2021 ushered in a tentative rebound in the creative sector over the past year. However, there are several major stressors threatening to reverse this fragile recovery. The Omicron variant of the corona-virus threatens to usher in a new wave of closures and restrictions devastating to arts industries reliant on human interaction. The meteoric rise in inflation is manifesting in higher supply costs, threatening businesses whose financial cap is already severely strained for weathering a 2-year pandemic, wage hikes, and rents locking in at higher prices. Unlike large businesses who may have deeper financial reserves, small businesses are often financed by owners' personal savings placing them in grave personal financial risk during periods of high inflation. Increased inflation means less buying power which in turn translates to a decreased ability to hire and retain qualified employees. Unfortunately, with last week's Consumer Price Index reading of 7 percent and the wholesale inflation rising to 9.7 percent year over year, a challenging economic environment for small business will continue. Unlike other industries who may be able to take advantage of automation and technology to replace people, the creative arts rely deeply on human skill and ingenuity. As a sitting Member of Congress and Ranking Member of this Committee, it is my distinct honor and privilege to welcome our witnesses today. I would like to thank all of you for participation. I look forward to your conversation. Mr. Chairman, with that I yield back. Mr. PHILLIPS. Thank you, Mr. Luetkemeyer. And now I would like to take a moment to explain how the hearing will proceed. Each witness will have 5 minutes to provide a statement and each Committee Member will have 5 minutes for questioning. Please ensure that your microphone is on when you begin speaking and that you please return to mute when you are finished. With that, I would like to introduce our witness for the day. Our first witness Mr. Carson Elrod. Mr. Elrod has been a fierce activist in the creative sector, most notably as a cofounder and coleader and director of Government Affairs for Arts Workers United, Be An #ArtsHero. Arts Workers United is an arts advocacy organization dedicated to establishing the arts and culture sector of the United States by means of support, investment, and representation. When he is not championing for arts and culture workers, Mr. Elrod is a professional actor who has appeared in live theater, motion pictures, on Broadway, and much more. We welcome you, Mr. Elrod. Our second witness is Ms. Nataki Garrett. A change maker and trailblazer, Ms. Garrett is a nationally recognized director and the sixth artistic director of the Oregon Shakespeare Festival (OSF). The first woman to artistically lead a $44 million theater company and OSF's first Black female in the role. Prior to her role at OSF, she served as our acting artistic director at the Denver Center Theater Company, as well as associate dean and the co-head of the Undergraduate Acting Program at the CalArts School of Theater. We welcome you, Ms. Garrett. Our third witness is Ms. Sandra Karas. Ms. Karas has married her passion of arts and advocacy, serving as the secretary Treasurer of Actors' Equity Association, a union of professional stage actors and stage managers in the United States. She is a licensed tax and finance attorney and serves as the director of the New York City Volunteer Income tax assistance program, sits on the Board of Directors of the New York Local of Screen Actors Guild, American Federation of television and radio artists, and is even an actor herself. We welcome you, Ms. Karas. And now I would like to yield to the Ranking Member, Mr. Luetkemeyer, to introduce our final witness. Mr. LUETKEMEYER. Thank you, Mr. Chairman. Our next witness is Ms. Reanne Presley. She is a co-owner of Presleys' Country Jubilee Theater and Branson Visitor TV. Presleys' Theater is a multi-generational, family-owned business and was the original live music theater in Branson, Missouri, Hosting its first show on June 30, 1967. In addition to being a small business owner, Ms. Presley is a devoted community leader. She became the first woman elected Mayor of Branson in 2007 and went on to serve 4 terms. She has previously served as branch of City Council, all of them for 10 years. Prior to her government service, Ms. Presley was Chair of the Missouri Tourism Commission and served in leadership positions on several community boards, including as Chair of the board of directors at Skaggs Community Hospital and Board of Directors of the Springfield and Branson National Airport, and the Branson Lakes Area Chamber of Commerce. Due to her hard work and exemplary leadership skills, Ms. Presley was honored as the recipient of the Missourian award in 2009. In addition to her sending her own views as a small business owner, Ms. Presley is here representing a National Independent Venues Association (NIVA), formed in mid-April of 2020 in response to the ill effects of the COVID-pandemic. NIVA Members include many small, independent venues, promoters, and festivals across the entire nation. Ms. Presley, it is a pleasure having you testify before this committee. I look forward to your valuable insights I know you will provide today. It is good to see you again. Ms. Presley and I, just for clarification purposes, worked together when I was the Division of Tourism Director in the State of Missouri and she was the leader in the Brandon area for all of the different tourism activities and venues there. So it is great to see you again, Reanne and welcome to the Committee. With that, Mr. Chairman, I yield back. Mr. PHILLIPS. We are going to expect you to sing a song, Mr. Ranking Member. Mr. LUETKEMEYER. Well, that is a good way to have us send everybody off. Mr. PHILLIPS. For short hearings. Anyway, thank you, sir. Thank you to all our witnesses for being here today. And with that, I now recognize Mr. Elrod for your opening statement for 5 minutes. STATEMENTS OF CARSON ELROD, CO-FOUNDER & CO-LEADER, BE AN #ARTSHERO, DIRECTOR OF GOVERNMENT AFFAIRS, ARTS WORKERS UNITED; NATAKI GARRETT, ARTISTIC DIRECTOR, OREGON SHAKESPEARE FESTIVAL; SANDRA KARAS, SECRETARY-TREASURER, ACTORS' EQUITY ASSOCIATION; RAEANNE PRESLEY, CO-OWNER, PRESLEYS' COUNTRY JUBILEE (PRESLEYS' THEATER) STATEMENT OF CARSON ELROD Mr. ELROD. Thank you, sir. Chairman Phillips, Ranking Member Luetkemeyer, esteemed Members of the Small Business Committee, thank you so much for your invitation to join today's groundbreaking hearing. I am an arts worker. I am a professional actor and one of the 5.2 million Americans that animate our creative economy. Arts workers like me support over 673,000 businesses, many of them small, that add $919 billion in value to our nation's economy. That is five times more than agriculture and nearly $300 billion more than all of transportation. We are big business because we are local business, from Kansas to Kentucky and Alaska to Alabama. Every state in the union is home to tens of thousands of arts workers whose labor contributes more than a billion dollars to each state's GSP. Our arts institutions are like stars that anchor a dynamic solar system of ancillary businesses. You build a theater or a museum and you can watch hotels, restaurants, and other small businesses grow up around them. The socioeconomic light of our creative businesses strengthens communities and stimulates their economies. Our nation's creative economy is in peril. In January of 2020, I had just been cast in a role in a television show that promised to be a gamechanger for me both professionally and financially. On March 13, 2020, that job evaporated and I joined 2.7 million of my fellow arts workers for 15 months of total unemployment. During this time, I joined Brooke Ishibashi, Jenny Grace Makholm, and Matthew-Lee Erlbach in starting Be An #ArtsHero and Arts Workers United to relentlessly campaign for federal relief, recovery, and a hearing just like this one. I was grateful to Congress for the Federal Pandemic Unemployment Compensation program, but even as the pandemic persists, that pandemic relief, like my jobs, has evaporated. And without union work, I lost my union health insurance. For the first time in my life I am on Medicaid. My last show got canceled because I, with my cast, caught COVID. I had an upcoming show this spring. It has been canceled because of COVID. My story is not unique. While I had some savings and the privilege to dedicate my life to this advocacy, so many, especially in the BIPOC, LGBTQ+ and disabled communities have been disproportionately impacted by this pandemic and they do not have it as good as I do. And I think I have it pretty bad. I am still haunted by a conversation I had with Patsy Bouressa from the SIMS Foundation in Austin, Texas. They provide mental health services for music workers. In just 1 month, four of their clients became so hopeless that they killed themselves. We cannot let the human infrastructure of our creative economy vanish into other industries or worse. The loss to our families, our culture, our communities, and future generations and the economy would be incalculable. Arts workers should be the backbone of our post-COVID recovery. The creative economy is a jobs multiplier with a normal growth rate of 4.45 percent. That is nearly double that of the rest of the economy. And the human need to gather, to find community, to share cultural experiences will be enormous after this pandemic. Congress can translate that need into strategic investments that will jumpstart the American recovery built on imagination, innovation, creativity, and community. To accomplish this, I recommend that: Congress commission a GAO report to fully explore what Congress can and should do to stabilize and stimulate the creative economy. Ensure that unemployed American arts workers retain unemployment benefits so that arts workers can stay arts workers. Immediately pass the Performing Arts Tax Parity Act, the Create the Place, that HITS Arts, the Arts Education for All Act, the Creative Economy Revitalization Act, and the 21st Century Federal Writers Project. Finally, Congress should work with the president to create a secretary of Arts and Culture. You have the opportunity to ignite not just a sunrise but a supernova of creative small businesses, triggering a chain reaction of such socioeconomic prosperity that history will remember this Congress as the Congress that provided the rocket fuel needed to launch us into the new American century defined by the incredible specialized labor of American arts workers and the 21st Century American Creative Economy that they drive. Thank you so much. Mr. PHILLIPS. Thank you, Mr. Elrod. And now I would like to recognize Ms. Garrett for 5 minutes for your opening statement. Ms. Garrett? STATEMENT OF NATAKI GARRETT Ms. GARRETT. Thank you very much for recognizing me, Chairwoman Velazquez, Representative Phillips, Ranking Member Luetkemeyer, and the Members of the Committee. I want to thank you for inviting me to appear before you today. I am the artistic director of the Oregon Shakespeare Festival, otherwise known as OSF. I am honored to be with you and share how COVID-19 has affected the arts sector, specifically OSF, to highlight our economic and social impact and to offer ways Congress can support the recovery of the creative economy. Founded in 1935, OSF is a Member of the National Theater Communication Groups and the Performing Arts Alliance. Prior to the pandemic we were a $44 million flagship nonprofit theater and one of the largest economic drivers of the southern rural Oregon economy. In a typical year, we welcomed over 400,000 people from all over the world to the town of Ashland, Oregon, a town of 20,000 people that has the same density of restaurants and hotels per resident as New York and Paris. OSF generates more than a quarter billion dollars of economic activity in the region annually, and we are responsible for a full 20 percent of its economic activity overall. Simply put, the arts are a powerful economic engine that drives our region. In March of 2020, we had just opened our season, my first as artistic director. Within 6 days of opening, COVID forced us to shut it all down. We had already spent about $20 million to get the shows ready for the stage and patrons had paid more than $6 million for tickets that had to now be refunded. And over the next few weeks, 90 percent of OSF's nearly 500 employees, including actors, crewmembers, carpenters, box office staff, craft artisans were laid off. Eight hundred twenty-nine performances of our 11 scheduled productions were shuttered and 2,300 community engagement and education events were canceled. Within a month, we laid off 500. That 500 led to 5,000 in our town and 20,000 across the region. In September of the same year, the Alameda fire struck through the region and destroyed more than 2,000 homes and businesses, including the homes of some of the remaining OSF employees. We set up a food bank, provided emergency housing, and dedicated a significant part of our annual gala to the relief effort. I am haunted by the choices I had to make to keep OSF afloat. But it is even more difficult for the culturally- specific and smaller venue or community-based arts organizations and their arts workers. Their work has a huge impact on the creative economy and often goes under resourced. I think about the hundreds of thousands of artists around this country who drive so much of our economy but themselves live in poverty. How can we continue viewing an industry that makes up more of our GDP than agriculture and mining combined as a luxury or a purview of the elite? How do we look millions of arts and cultural workers in this country in the eye and not take simple, common sense steps to simultaneously make their lives and our economy more secure and robust? How can we continue cutting arts programs in schools when we know that students who participate in arts education are more likely to go to college and less likely to go to jail? The reality is that the infusion of federal dollars, along with the generosity of our donors and patrons, without that it is likely that I would not be here today because OSF would not be here today. I am very thankful for the assistance this Committee provided through the Shuttered Venue Operators Grant program, formerly known as SOS and other forms of COVID relief. At OSF, we have a tradition. Following the curtain call of our last outdoor play each season, every person in the company carries a candle and silently enters a darkened theater to the strains of Greensleeves. A veteran company Members speaks Prospero's speech from act IV Scene 1 of The Tempest. It is like a prayer. ``Our revels now have ended . . . '' It is a promise, 1,200 audience Members from all walks of life hang on every line. The candles are extinguished and the company silently and reverently exits the theater. It marks the ending of a season of hard work and beautiful art making and the promise that the house lights will be rekindled once more. In 2020, I was afraid that those candles had gone out forever. But I am here to tell you that we will make sure that the creative economy endures. As an artistic director, I am committed to ensuring that those candles burn bright and those words are spoken for years to come. The power you hold, you can assure the flickering candle of the creative economy can continue to burn bright. Right now, bills such as the Creative Economy Revitalization Act and the Performing Arts Parity Act and the Arts for Education for All Act, bipartisan bills that positively impact the economies of every state and enjoy broad public support, are waiting for Congress to act. It is not a radical act, nor is it controversial. It is recognizing a simple fact that the arts and the artists drive local economies and at the same time lift people out of darkness. I thank you for this time and thank you for what you will do next. And I look forward to your questions. Thank you very much. Mr. PHILLIPS. Thank you so much, Ms. Garrett. And now I would like to recognize Ms. Karas for 5 minutes for your opening statement. Ms. Karas? STATEMENT OF SANDRA KARAS Ms. KARAS. Chairman Phillips, Ranking Member Luetkemeyer, thank you for the invitation today. I am Sandra Karas, an actor, Secretary-Treasurer of Actors' Equity Association, and a Member of SAG-AFTRA's New York local board. I also appear before you as a small business owner. I am a tax attorney, accountant, and financial advisor with a practice here in New York. You are going to hear today about the power of the creative economy, and the live arts in particular, rightly so. The arts and culture sector is responsible for 5.2 million jobs and 4.3 percent of the GDP. The live arts have a huge halo effect on small business, many of which would not exist without the arts. Patrons spend on restaurants, parking, taxis, hotels, childcare. Nationally, that amounts to more than $100 billion in additional spending. The creative economy drives revenue growth for business and workers. The reason, unions. I am speaking to you today on behalf of Actors' Equity Association, the union of actors and stage managers in the live theater. Our Members work across the country Los Angeles' 99-seat non-profits, to Kansas City's Starlight Theater and St. Louis' Rep, to Buffalo's Kavinoky Theater, and the Wintergarden on Broadway, and everywhere in between. Our contracts include healthcare and pensions. As the original gig workers, we are the proof that companies need not choose between profits and W-2 employee protections. The pandemic has indeed created a crisis. While many businesses have recovered, the new variant has brought tremendous uncertainty and job loss and a live arts performance once again just last week had closed in IRIS. Earnings and health insurance were put at risk. When live events close, the small businesses that depended on them also feel the crunch. There is one way you can help all of us arts workers. Congress has an opportunity to pass the Performing Artist Tax Parity Act (PATPA), which modernizes a provision enacted by President Ronald Reagan and will provide relief to entertainment workers. Performing artists pay a high percentage of their income on necessary out-of-pocket costs to look for work and stay current in the industry. We pay agents and managers, transportation to auditions, maintain our websites, headshots, video reels, and more. It can amount to 20 to 30 percent of our gross income. Previously this was deductible. Because of an unintended consequence of tax reform, we lost the deductions of our unreimbursed business expenses. This means a tax increase, often of thousands of dollars for working-class artists. I have seen heartbreaking stories at the Volunteer Income Tax Assistance Program, here at our Equity office, where volunteers process thousands of free tax returns annually for low-income arts workers. One young taxpayer, upon learning that his liability increased by more than 30 percent, wondered aloud how he was going to pay his rent. As we return to work, the last thing we need is a tax code that punishes us for seeking work. This bill is targeted to low-income and middle-class taxpayers, not the high-earning stars. I commend Representatives Chu and Buchanan for leading the effort to pass this bill in the House. Thank you, also to Representatives Newman and Garbarino for cosponsoring. I ask you all for your support. PATPA is Equity's top legislative priority and it is endorsed by unions and employers. But it is not our only priority. We also released a federal policy agenda for inclusion in the arts, in partnership with our fellow arts unions. The National Endowment for the Arts should create a chief diversity officer to drive inclusion deeper into the grant process. And we strongly support the CROWN Act to end hair discrimination in our industry. On behalf of all the arts unions, I want to thank the Small Business Committee for helping to make sure that unions were treated fairly during the pandemic by allowing access to the Paycheck Protection Program. Our staff worked harder than ever and this program was a lifeline to them and to our employers. I will conclude today where I started. The arts sector is a robust contributor to our national economy because of a strong union presence, not in spite of it. In an industry where competition is keen and there are more workers than jobs, we ensure workers have a voice in their workplace, secure standards, and safe working conditions. That is why the PRO Act has our full support. It will reform outdated labor laws and protect against exploitation and employee misclassification, which is unfortunately far too common in our industry. It will help the arts and culture sector, and workers, prosper into the next century. That is the true promise of the creative economy. I thank you for the privilege of appearing before you today. Mr. PHILLIPS. Thank you, Ms. Karas. And now, Ms. Presley, you are recognized for 5 minutes for your opening statement. STATEMENT OF RAEANNE PRESLEY Ms. PRESLEY. Good morning, Chairman Phillips, Ranking Member Luetkemeyer, and distinguished Members of this Committee. Thank you for inviting me to add my voice to today's hearing. My name is Raeanne Presley and I join you from my home in Branson, Missouri. I am co-owner of Presleys' Country Jubilee, along with my husband Steve and in-laws, Gary and Pat Presley. As a former mayor of Branson and former Chair of the Missouri Tourism Commission, I can attest that family friendly entertainment and the creative spirit is at the heart of our community. In 1967, the Presley family opened the original show on Highway 76. Lloyd and Bessie Presley, along with their four children, dreamed of entertaining the fishermen and families with wholesome comedy and music. Opening Branson's first live music theater on a small, unpopulated two-lane road was risky but the Presley family was passionate about entertainment and determined to make their living at it. They exemplify the entrepreneurial spirit that drives our industry and helped to build our city. This March, Presleys will open our 56th season. Our 1,500 seat theater which started with folding chairs has expanded nine times over the years. We now employ 70 people, produce more than 200 events each year, and have a weekly television show averaging 300,000 viewers. Our preshow features a gospel singalong in our mezzanine, ushers to take you to your seat, Coke, popcorn, and cinnamon nuts to enjoy. The heart of our show remains the same--to provide lifelong family memories and opportunities for folks to forget their troubles for a time. Many Branson venues, including Presleys, were fortunate to receive Shuttered Venue Operators Grants and PPP loans. We are grateful to our elected leaders, especially co-sponsors Representative Williams of this Committee, Representative Welch, and so many of you who have recognized that our industry matters. Without your support for the Save our Stages Act, I might not be here today to tell you about the challenges we face beyond the pandemic. So let me just make sure to say thank you for this lifeline for our industry. The reaction of our audience when we reopened showed just how much people need live entertainment. When the curtain went up on that opening song, the audience stood for a sustained standing ovation. I heard similar stories from venues coast-to- coast. Our economy also needs live entertainment. A 2019 study showed that for every dollar spent at a small venue, $12 of economic activity was generated. While Branson's population is just over 12,000, our theater and music industry employs nearly 2,000 people and helps to bring an estimated 8.2 million visitors to our region each year. Nationally, more than 80 percent of adult travelers can be considered cultural tourists. They spend more, travel more often, and stay longer. Simply put, independent music venues and the creative arts are economic engines for communities nationwide. Today, the rollercoaster ride of the pandemic continues. Traditionally, about 5 percent of ticket buyers do not attend a performance but now sagging consumer confidence is causing national no-show rates as high as 50 percent. This is devastating because most of our venues rely on in-house sales to pay core bills. We are also now confronted with increased costs due to inflation. Just in the past month, I have received notices of impending price increases from our trash hauler to our concession suppliers to our janitorial service. And like many other businesses, we face the difficult challenge of finding workers in a competitive environment. Remote work is not an option for our business. It is especially challenging to compete with national employers who are able to offer higher starting wages. The passing of the Save Our Stages Act was a break we needed to survive the pandemic. Now in the face of increasingly difficult economic conditions, we are looking for the break we need in order to thrive. I have seen the ability of the creative economy to bring Americans to their feet. Out of pure joy amidst the darkness of the pandemic, I have seen the power of the creative economy to transform a two-lane stretch of blacktop into a world-famous tourism destination. Thank you for recognizing the importance of our industry and the value our small businesses add to communities across America. I urge you to keep the creative economy top of mind as you consider policies affecting small businesses. Thank you for your time and leadership. Mr. PHILLIPS. And thank you, Ms. Presley. And to all of our witnesses. We appreciate what you have shared with us and you very much humanized an issue of great importance to all of us on this Committee and to our country. Now I would like to begin by recognizing myself for 5 minutes. And Mr. Elrod, I would like to start with you. You have referenced the pendulum of openings and closings and stops and starts of so many entertainment businesses. And as you know better than anyone, the live events industry in particular has been disproportionately impacted by the pandemic. So can you share a little bit more with all of us how are theater companies in particular responding to the chaos and disruptions of new openings and cancelations due to Omicron in particular? Mr. ELROD. Well, I think I can speak to my own experience in that, you know, the show that I was working on this fall, The Alchemist for the Red Bull Theater Company was an off- Broadway show at the New World Stages in midtown Manhattan. And after 15 months of being completely and totally dark, finally Broadway was starting to come back. Off-Broadway was starting to come back. So here we were. It was a comedy. And despite the masks, things were starting to look up and come back to normal. But just a few weeks into our run we started to see the impacts of Omicron all across the city as different shows had different people calling out and especially on Broadway where shows are a little bit better resourced with understudies and covers and replacements for everybody in the building, even those most- resourced shows were facing challenges that were ending up putting shows on hiatus or closing them altogether. So we were kind of watching from the sideline and then on December 15th it came to us in the form of me coming to the theater with symptoms, taking a Rapid test, seeing a positive result, and three other people in the cast got it. And without the understudies, without the extra stagehands, the theater was faced with only one choice and that was to close the show completely. So it is very, very hard. As Raeanne Presley said, remote work is not an option. We all have to be there in the building. And if we are sick, we cannot be in the building. And you can see the consequences writ-large all over the country anywhere people have to gather together in enclosed spaces. Mr. PHILLIPS. I appreciate that and also your advocacy for more targeted relief dollars for an industry grappling with the challenges and in particular the actors and the artists that are so impacted. So thank you. Ms. Garrett, you have noted that the Oregon Shakespeare Festival received $10 million I believe in SVOG funds and also $5 million in PPP funds. Could you share with the Committee in more detail how those allocations helped the organization survive? Ms. GARRETT. Yes. If you can imagine at a $44 million organization, our spend rate was $5 million a month. And even when we had to shrink everything down to about 10 percent of our staff we were still going through a lot of money giving back tickets and revenue and that kind of a thing. And keeping our lights on and the doors open and all of that stuff. That resource is supporting all kinds of things including we were able to open a production last summer. We were able to do a production, our first winter production that opened and closed without any COVID-related closures, thank God. But we are spending $200,000 a month on tests just to try to keep people aware of whether or not they are sick or not. We have a very kind of robust system around making sure that we do have a lot of people covering because closing for COVID was not a option for us to be able to open that show. And every time we do spend money at OSF to make sure that we keep going, we take the entire town with us. Everybody comes with us on that journey. So the restaurants are open because of the PPP money. The hotels are open because of the SVOG money. So in rural Oregon we are a complete ecology interconnected with one another. And so for every dollar that we received from the federal government, every resource, every single dime helped to make sure that we could buoy the entire region, especially through the fire. And now we have a little bit of resource to be able to hopefully open this spring. We are all crossing our fingers but this is with a lot of resource being spent in advance to get the shows open and a lot of resource being spent for testing. Mr. PHILLIPS. And I thank you. I see my time is expiring so now I would like to recognize the Ranking Member, Mr. Luetkemeyer, for 5 minutes. Mr. LUETKEMEYER. Thank you, Mr. Chair. I will start out with a question for Ms. Presley here. In your testimony here you talk a little bit about dealing with inflation, with rising costs, worker problems. Can you elaborate a little bit on that from the standpoint of how you are able to absorb those costs, how you are able to keep going? I know you mentioned the SVOG program as one of the ways to be helpful, and PPP. So can you paint a fuller picture for me, please? Ms. PRESLEY. I am happy to, Congressman Luetkemeyer. Thank you again for allowing me to speak. I would say that the uniqueness of a small business which there are millions, of course throughout our nation. Inflation is certainly going to impact in many ways as we look forward. While the PPP money and the Save Our Stages money was critical to keeping our employees on payroll this last year and to allow us to not borrow an enormous amount of money to keep open, uncertainty is the future. In terms of inflation, my really only two options are to pass costs along to our customers or to diminish my customer experience. And while I am getting notices from some vendors about their increases in price, I also know that I will simply open bills come May and June and find that things cost more. Those are very real for all of our small business owners. And to remind you as a small business owner, we do not have a deep financial backstop. We are it and we each sign agreements with our banks and our lenders to put our homes on the line and our assets on the line. We are happy to do that. We are happy to grow our businesses. But it is difficult. And with the uncertainty with COVID it is unknown. We need consumer confidence to rally. We need people to feel safe and want to travel and spend their money on entertainment when they have other needs as well. Mr. LUETKEMEYER. You know, there is a limit and as a small businessperson, you know, you can price some of those increase into your higher ticket prices but there is a price point in which your customer base is going to say no, we cannot afford this or no, we are not going to do this. Or they are going to cut back on the number of shows they go see. If you could elaborate. In Branson, you have an enormous number of shows and not only venues but a number of shows per day. And so a lot of people go there and they see multiple shows over 2 or 3 days. They are going to cut down on those number of shows if they raise price points. Have you looked at that, what the price point would be and how much it would affect not only yourself but your other venues there in Branson, how much of an increase they can sustain? Ms. PRESLEY. Well, Branson has been built on very family- friendly, affordable entertainment. That is one of our hallmarks and we are proud of that. There are 37 theaters right now that host performances and that price point is frankly unknown. We will pass along some of the cost increases to our customers in increased ticket prices this next year. I wish I could say that I knew but I do know that human nature tells me that as we have seen at venues across the nation, people are going to not buy that extra t-shirt. They are maybe not going to have the merchandise to take home that they would have normally had. They may not buy as much concession stands or food and those are really vital things for our independent venues to help with the bottom line. I am hopeful that our customers will stay with us and realize that they want a quality product, and so far we have seen that to be the case but we are always looking for ways to make a family vacation affordable. Mr. LUETKEMEYER. Thank you for that. Ms. Garrett, you made a comment that really kind of stuck with me and that was the ripple effect of the SVOG program's dollars. You were saying that to keep your entertainment venue going it is not only important to the venue and the workers themselves but to the rest of the businesses in the area. And so would you like to elaborate a little bit more on that? I think it is a very important point. Ms. Garrett? Ms. GARRETT. Yeah. Thank you very much for the question. OSF is in a rural area so we are a kind of interdependent ecology. Everything that we do affects everyone around us. And so when I said that we laid off 500 people and 5,000 people lost their jobs locally, you can imagine the impact. This is a place that people moved to with their families to work at OSF and other businesses around here. And with our tourism at a standstill, it was very difficult for people to keep their businesses open without OSF being open. Mr. LUETKEMEYER. Thank you. I see my time has expired. Thank you, Mr. Chairman. I yield back. Mr. PHILLIPS. Thank you, sir. And with that I now recognize Ms. Davids from Kansas, the Chair of the Subcommittee on Economic Growth, Tax, and Capital Access. Ms. DAVIDS. Thank you, Chairman. And thank you everybody for attending. And then for those who are offering testimony today, I appreciate your time to talk about this important topic as it relates to importance of the creative arts sector for our small business community. We are hearing about it, how hard the sector was hit and continues to be by this pandemic. And the artists and creative arts small businesses have had to work really hard to overcome some of the unique and particular challenges that are being faced. In Kansas, the arts sector makes up around 3 percent of our state's GDP and employs about 50,000 Kansans. I feel like I do have to mention I have spent some summers going down to Branson and Lake of the Ozarks, too, reciate seeing you on here today, Ms. Presley. But because of the importance to Kansas, I was really proud to be one of those folks to help create the Shuttered Venue Operators Grants program, providing directed relief to theaters and music venues and other performance venues. Kansas small businesses received around $99 million in SVOG grants last year, which really provided a lifeline to hundreds of small business. And I have continued to advocate for additional directed relief funds for these kinds of businesses. And as the most recent variant has shown us, we are not quite out of the pandemic yet. So in conversations with local organizations, nonprofits like the Arts Council of Johnson County, we know that they have been working to support creative partners throughout the community during the pandemic. And most recently I started focusing on small business education and helping artists understand some best practices. You know, business and legal practices. And so I wanted to ask Ms. Karas, do you think that the artistic community could benefit kind of more broadly from programs like this, business counseling and guidance especially for those small artist-led businesses? Ms. KARAS. Well, certainly the business owners can benefit from any kind of development that can be offered to them in terms of education, what is available out there for economic development, certain trends that people often do not see when they are running their own business. They might not see the trends that are going on around them. As to the ripple effect that, of course, it will have, it is on the individuals they hire, the workers. And so everybody will benefit from it to the extent that the education is out there. When government gets involved in looking at very carefully an assisting business, we all benefit. Not just the people who own the businesses but the people who work in them. And as I stated before, the ancillary businesses that benefit from all of the arts economy is sometimes immeasurable. We do not even sometimes stop and think about who might be creating a business around something just because there is an arts employer in the area. So, yes. The short answer is yes. I think business owners and business developers could benefit from all the education and development that could be available to them. Ms. DAVIDS. Thank you. Ms. Garrett, I was hoping to hear from you about, you know, we heard you talk about the kind of ripples and those economic shocks that we see, and particularly as it relates to in-person programming, I am curious about your view of how we can help small businesses in this sector stay resilient as we think about further pandemic and maybe other types of disruptions. Ms. GARRETT. So locally, I think it is important to make sure that the federal government keeps infusing resources back into these ecologies and communities. For mine in particular, I think just like every other industry we are going through this sort of great resignation. The more dollars that are lost within these industries that are interconnected, the more likely people are to leave to go to other industries that are more likely to be able to survive. And creative workers in particular are leaving in droves. And so they are leaving restaurants and they are leaving theaters and they are leaving their day job. They are leaving everything so that they can figure out a way to survive. So more infusion of resource would really be helpful. I thank you for the question. Ms. DAVIDS. Thank you. I see my time has expired. Chairman, I yield back. Mr. PHILLIPS. The gentlelady yields back. And now I recognize the Vice Ranking Member of the Committee, Mr. Williams of Texas for 5 minutes. Mr. WILLIAMS. Thank you, Mr. Chairman. And thank you to all of our witnesses. Like all of you, I am a small business owner in Texas. I have been for 51 years. And my father was a great singer in the stages around at the Casa Manana in Fort Worth, Texas. So I grew up seeing a lot of your industry. When I talk to business owners back in Texas, they are concerned about our supply chains, the out-of-control inflation and the constant threat of tax increases coming from the Democrats in Washington. Each one of these crises poses new challenges for small businesses and adds additional costs for them to keep their lights on. This leaves business owners with tough decisions in order to keep doing what they love. They may have to reduce capital investment. They may have to hold off on hiring new employees or pass the costs if they can along to consumers and raise prices as they are able to keep their doors open. So Ms. Presley, my question to you is, in your testimony you talked about how your business has struggled with the increase in the cost of goods due to inflation. We all have that problem. Can you discuss the adjustments your business will have to make to offset these cost increases? And furthermore, how do you think tax increases proposed by the Democrats could affect your business? Ms. PRESLEY. Well, thank you, Congress Williams. And thank you as well for your sponsorship of the Save Our Stages Act. As I said, we will open again in March, and I think some of the difficult decisions we will make, this is the time of year when we order the sequined jackets and costume and when we make upgrades to our stage. When we look at hiring new performers. Those are all decisions that I believe we will make a bit on a hope and a prayer to be honest. We are very much focused on what is in front of us. Not so much the unknown. We feel like with COVID and all of the issues that you and Congress must have on your plates, we respect that. One thing that would be helpful I wanted to mention while I had the opportunity is, you know, with the SBA, many of us received grants that helped our businesses. Those grants were a bit late in coming and we are hoping very much for an extension of time to spend that money. That could make a big difference for many of our venues. And so I wanted to put that before you as well. We are hopeful that COVID will abate. We see that happening in the East but not here yet. And we are very much hoping to be able to operate our businesses as we have done in the past and keep our costs in line so that folks can have a great time. Mr. WILLIAMS. Okay. I was the Republican lead as many of you said today, and I appreciate that on the Save Our Stages bill that ultimate turned into the Shuttered Venue Operators Grant Program, better known as SVOG. This was a necessary piece of legislation because it helped businesses that were some of the first to close and the last to open as a result of the pandemic. Unfortunately, the SBA took months to get this program up and running and many venues did not survive these delays. And I applaud businesses like yours, Ms. Presley, for being so resilient and able to hold off through this incompetency we saw at the SBA in order to access these funds. Now, throughout this process, I worked extensively with NIVA to communicate the horror stories that we were hearing from the industry as businesses failed to get answers from the SBA regarding the program. So another question to you, Ms. Presley, can you expand on your experience with the SBA and any issues you faced when attempting to receive the SVOG funds? Ms. PRESLEY. Well, we had not worked with the SBA in the past. I was thinking about all the things that we have gone through in 56 years. We have been through 9/11 and gas shortages and recessions so this one is a new one. But while our experience with the SBA was good, we did have that delay and that certainly made everyone tense and nervous. I will applaud NIVA and your efforts as well, Congressman, to continue to find ways. This was a new program, something unique, and we recognize that. So the dollars did not flow as fast as we wanted them to. But that said, I think there is a new opportunity to look at now. I know as Ms. Karas talked about, an opportunity for SBA to expand their outreach to business like mine. Many people want to grow their businesses. Entrepreneurs want to start new businesses. We are seldom happy with the status quo and I believe SBA could be a backstop for us. Could provide a lot of information and knowledge that an entrepreneur might not have. So I will say that I look forward to kind of renewed efforts. Mr. WILLIAMS. Well, easier, not harder would be what we want the SBA to understand. Lastly, businesses across the country are struggling to find and retain talented workers. Mr. PHILLIPS. Mr. Williams, your time has expired, sir. I am sorry. Mr. WILLIAMS. My time expired. I return to you, Mr. Chairman. Mr. PHILLIPS. All right. Thank you, sir. And with that I recognize the gentlelady from Illinois, Ms. Newman, for 5 minutes. Ms. NEWMAN. Thank you, Mr. Chair and thank you, Ranking Member, for putting together this great testimony today. So let me start by thanking all of the witnesses on this call today. You have brought light and love to when we desperately needed it throughout our nation. I am a firm believer that the arts not only heal and help us get through hard times but also unite those that typically are not united. So thank you for your great work. I will also say a couple of other things. Having been an assistant producer and a copyrighter in my early career, I have very genuine feelings on this topic because those were hard times when I had no health care. I went without jobs for long periods of time. And it was just a constant struggle. So I clearly have the lived experience around it but also, you are living it right now in a much more challenging environment. So I that much more applaud your amazing work. I am also a former small business owner. So kind of a 360 on this topic. So I feel for everyone. I have a forward-looking set of questions. And I am going to go to Ms. Karas first. So being a Member of the Women Labor Caucus and being a product of unions and being a strong advocate for unions, there are just some very creative things that unions have done over time to support their workers in these times. We may have this issue again. I do not think we can deny that now. So Ms. Karas, what do you think we can do to support our unions to help our artists and creative community to be stronger? Are there some ideas you have in a forward-looking way that would help us anticipate further bad times at some point? Ms. KARAS. Thank you. I appreciate this question. I have been in unions for a long, long many years and every time I think about what unions do for the workers it all comes down to providing the security of a group that supports itself and supports one another. You know, we call each other sisters and brothers in our organizations and there is a kind of a family feeling. We depend on one another. My colleague, Mr. Elrod and I are in the same unions and he knows he can depend on me and I know I can depend on him when the going gets rough. That is what solidarity is all about. So that is part of what unions provide for people. But moreover, the job security while they are working to know that they are going to be taken care of, and employers, you know, it is no accident the biggest entertainment employers in this country and maybe in the world hire multiple numbers of unions to do every project they have. Why is that? Because they know what they are getting. And that is another kind of security that we all look at. We want to make sure that when we show up on the job we are going to be treated decently, we get good pension, health, and other job securities. And we also know that our employers appreciate that we are ready to show up and provide professional work in a disciplined manner. And looking forward, I think that some of the government, the COVID pandemic relief that our union received along with hundreds of thousands of other businesses was a lifeline to keep the doors open, to keep the lights on, and some semblance of staff even if you could not keep everyone to provide securities for the industry. We provided assistance to Members who could not pay rent, utilities, medical expenses, by donating to the Actors Fund, which is a charity, a national charity. Union workplaces also know that they provide better conditions for women and people of color than nonunion employers do. And the wages are higher, the benefits are better. And so when workers are looking for work, many of them want to go to unions because they know that they will have that security. And we are seeing that kind of interest arise among young people today throughout the country because they know if they ban together and tell their employer what they need, they are stronger together. So off the top of my head those are just some of the remarkable benefits of a union. And going forward, I think the stronger the union movement is, the more the workers will be there for the American economy. Ms. NEWMAN. Well, thank you for your comments. And yes, well heard. I, obviously, as some of the folks mentioned, am a strong proponent of the PATPA--because when we have stronger unions, we have a stronger middle class. So thank you. If I may---- Ms. CHU. [Presiding] The gentlelady's time has expired. Ms. NEWMAN. Okay. Thank you. I yield back. Thank you. Ms. CHU. And now, Mr. Fitzgerald, the gentleman from Wisconsin, is now recognized for 5 minutes. Mr. FITZGERALD. Thank you, Madam Chair. Ms. Karas, there has been some interest from some arts and culture organizations including in my home state of Wisconsin of temporarily removing the $300 cap on charitable giving deductions to allow more money to kind of flow into the nonprofit creative sector which seems like obviously an easy thing to do and a good thing to do. But you are here not only representing the Actors' Equity Association but also their foundation. Have you guys looked at this and do you know what the impact might be? This would be, I guess, considered support for the Performing Arts Tax Parity Act. Ms. KARAS. Yes, thank you very much, Congressman. You know, of course we have looked at all the tax changes that have come about in the Tax Cuts and Jobs Act and the recent adjustments that have been made to the code and the above-the-line deduction for charitable contributions has certainly been a boon to the charities who many of which thought that they, and did actually, lose contributions because of the less use of the itemized deduction schedule. The reduced use I should say. So yes, I think any contributions to nonprofits are always going to be welcomed. Is it going to have a huge effect on someone's tax liability? Possibly not at the rate of 300. But if it was unlimited you would see the nonprofit world be much more supported by the contributors because they would have an incentive to do it now if they are not using the itemized deduction schedule. So it is a definite yes. We certainly approve of it. And while it does not have a direct effect on the Performing Artist Tax Parity Act, that, too, will support businesses and employers as workers are able to stay in the industry, feel confident in the industry because they have equalized their incomes with other taxpayers who earn the same amount of money. Mr. FITZGERALD. Very good. Thank you for that answer. Let me turn to Ms. Garrett. Ms. Garrett, kind of a trickier question, something that obviously many entities are dealing with but I know the Oregon Shakespeare Festival announced that proof of full vaccination or a negative COVID test will be required to attend performances in 2022. We are kind of already seeing the effects of this requirement. But how much of an impact do you believe this will have on ticket and concession sales and particularly I guess as we get closer to spring and into the summer months? Ms. GARRETT. So thank you very much for the question. OSF has had for years had a very loyal patron base that comes back year over year, over year, over year. And they love the company. They love the artists that work here and would do anything to make sure that those artists are saved. So what we have experienced in these last few months of producing plays is a real robust participation in making sure that you are vaccinated and you have your card and that you have your proof of the test and, you know, that your child has a proof of the test and everybody is willing to go in in masks. We were kind of surprised at how compliant our patron base is. And again, that is because we have families. We have legacy families that have been coming here for 30 years, 40 years. Grandparents bringing grandchildren. And so there is a real desire to make sure that everybody is safe. So it will not affect our bottom line I do not believe because of the desire for people to be safe. And we have had patrons say as they are standing in line with their cards and everything, you know, thank you for doing it this way. We want to be able to be safe, too, as we walk into these spaces. Mr. FITZGERALD. Yeah, I think the sands are shifting quickly on those issues and I think we will see how that plays out. Thank you for being here today, and I yield back, Madam Chair. Ms. CHU. The gentleman yields back. And now Ms. Bourdeaux from Georgia, is now recognized for 5 minutes. Ms. BOURDEAUX. Thank you so much, Madam Chairwoman. The creative economy is a very vital part of our nation's economy and enriches our communities through all sorts of cultural contributions. I know after being deprived during COVID for a while, just sitting and hearing people sing in person just was such a wonderful, spiritual lifting up. So I personally experienced how great it is to get back to the arts. In my district, arts-related businesses employ an estimated 10,000 people and venues in Georgia's 7th District received some of the much-needed relief in the form of over $2 million through the Shuttered Venue Operators Grant Program. But clearly more work needs to be done. The SVOG provided this important boost, but one of the things we are starting to think about more now is what are we going to do if we keep getting hit by these COVID variants over and over, and over again going forward? And how do we need to be thinking about how we support the arts industry? How do we support industries like this over time if that is going to be the scenario? So I guess starting with Mr. Elrod, maybe if you could talk a little about this and what is going on in the industry as they are thinking about this. Obviously, theater is about being in person and that is challenging. What do you think the creative industry is going to need both to recover from the pandemic but also to really prepare for the long-term if this does, in fact, become something where we are going to have to deal with it for another couple years? Mr. ELROD. Well, thank you very much for the question. I think one of the things that is interesting is that with COVID- 19, especially with Omicron, we are in a situation where we have been hit by a tsunami. The tidal wave is in and it has not gone out. So we do not actually know the negative impact on the entire creative economy right now. And one of the closest things we had is that Brookings Institution's report from last summer, Lost art: Measuring COVID-19's devastating impact on the creative economy, which measured losses just between April and June of 2020. And we were talking about $150 billion in lost sales and 2.7 million unemployed arts workers. So if you extrapolate that out and just keep multiplying over and over and over again, you really do think about it in terms of that star analogy that I used in my opening speech. We are in a situation where there are possibly, probably many black holes all over the country with lost art, lost institutions, closed venues, and arts workers themselves. Ms. Garrett talked about the workforce leaving and doing other things. And when you think about who we are, what we do, and what we provide, you want these 5.2 million workers doing what we do. You want all 673,000 businesses to survive this because they do anchor local dynamic economies. So what there is to do about it is absolutely all the interventions that everybody else has been talking about. But what I was proposing in my opening testimony is a kind of creative economy super package. If you take every piece of arts investment legislation that has been introduced in the last couple of years, put them together, really make sure there is robust unemployment, you can put together basically a floor underneath the entire industry, especially our arts workers and get us to launch into this next phase. But because there is so much unknown and the wave is still in, that is why I was recommending maybe a GAO report or a congressional commission because I think with a $919 billion industry that has suffered this much damage and continues to suffer this much damage, we have to take a really deep granular look at what is happening, what has happened, and what needs to happen for us to come back. Ms. BOURDEAUX. Thank you. I am going to run out of time but I want to just wrap up with this idea. So, for instance, we have introduced legislation. It is called the Fresh Air Act for Business, which is to improve ventilation in businesses. And the idea is we need to restructure for the long haul as opposed to just give short shots of funding in order to just make it through the crisis. And so I just want to encourage everybody to start thinking about this. We do not know for sure that that is what is going to end up happening but I think we need to start planning for that and start thinking about what is the congressional response if, in fact, this is going to be something that we need to plan for the long haul. Thank you so much. I yield back. Ms. CHU. The gentlelady yields back. And now the gentlelady from Texas, Ms. Van Duyne, is recognized for 5 minutes. Ms. VAN DUYNE. Thank you very much, Chairwoman and Ranking Member Luetkemeyer for holding this hearing. Early in the pandemic, the effect on the creative economy was apparent. Shows were halted, venues were shuttered due to unclear CDC guidance. State and local restrictions were constantly shifting, making it very hard for small businesses to reopen and stay open. After a long wait, consumers in many states, such as Texas where I represent, are now returning to their pre-pandemic lives. There is no doubt that one of the keys to a thriving creative economy is an open society. States and localities across the country should follow Texas's model. Unfortunately, those eager to return are now faced with new economic challenges. Everywhere you turn, from the gas pump to the grocery store, prices are rising the fastest in 4 decades, and that is if you can even avoid empty shelves. The Democrats' response continues to be throwing more money at the problem but at what point do we ask what we are getting for that money? We spent taxpayer dollars paying people to stay home from work for much of the pandemic, but it is still hurting employers. And just last week we had the SBA's OIG unable to tell us what happens to the billions of dollars of fraudulent money that is clawed back from SBA's COVID relief programs, money that could be highly beneficial to the very businesses that we are discussing today. The creative sector is part of the small business economy and all small businesses are in desperate need of solutions to inflation, supply chain struggles, and employment shortages. What we do not need is another frivolous, multi-trillion dollar spending package while we are chasing down at least $100 billion in fraud. The fact is, billions of federal dollars remain unspent and state governments have so much access to stimulus money that they are now paying off deficits that were created by their failure to keep a balanced budget instead of going toward the pandemic. I am interested, Mr. Elrod, your business is in New York City. During the pandemic, state and local governments diverted in how they handled restrictions in their respective communities. In each of your communities, well, specifically in New York, how did your state and local restrictions and regulations affect your business and ability to operate? Mr. ELROD. Well, in New York City, I was sitting with a friend of mine. I was on my way to see a Broadway show on March 11th when we were sitting in a midtown bar and our governor came on and announced that Broadway was closing. And not far after that, off-Broadway. And then pretty much the curtain came down and the lights went out all across New York City. And a lot of people in retrospect feel that March 11th was too late and that the response was too slow and that the virus had already taken hold in New York City, obviously, a very dense metropolitan area. As an L train rider, I can tell you we were all in a lot of danger. And so I believe that what happened was appropriate and prophylactic against---- Ms. VAN DUYNE. So then you are agreeing that shutting down was the appropriate response. And I also need to ask, did you understand that New York City, or New York has received over $272 billion in COVID relief? I am wondering how much of that $272 billion has been received by the State of New York. Do you feel like that was appropriately spent on the arts? Mr. ELROD. Well, part of the efforts I was with earlier in the year, as Be An #Arts Hero we were deciding do we go to the state and see if we can get American Rescue Plan funds or do we continue talking to the federal government? And the answer has to be both. Because what we are really doing here with Be An #Arts Hero is we are calling it CELP, the Creative Economy Literacy Project. And what we are trying to do is talk to people like you in state and local government and say, hey, we are in a profound amount of trouble. And if you really want to build back in an incredible way, we are the way to do it. But you need to stabilize us, put a floor underneath us, and then you can harness us as a backbone of a great recovery. So in my opinion, there is never going to be enough money spent on the creative economy until everybody understands just what a phenomenon we are and what an incredible resource is available to policymakers if they would like to take advantage of us. And that is why I have proposed this kind of super package to stabilize us and allow us to, you know, help us to help you build back on the other side of this. After the plague came the Renaissance. After the 1918 Flu came the Roaring Twenties. There is going to be a huge appetite for what we have to offer so we need to be around to offer it and we will jumpstart this. Ms. VAN DUYNE. Thank you. My time is done. I yield back. Thank you. Mr. ELROD. Thank you. Ms. CHU. The gentlelady's time has expired. And now I recognize myself for 5 minutes. First, I want to thank Chairwoman Velazquez for calling this important hearing which I was truly looking forward to as a representative of the Los Angeles area, which is the center of film, television, and music. It is hard to overstate the impact that the pandemic has had on the creative economy. To support a strong, durable recovery for those industries that employ over 5 million workers nationwide, we need to ensure that creative professionals are fairly compensated for their work. And that includes musical artists, like Members of the Recording Academy who must be fairly compensated, as well as our actors of film and television. That is why I am proud to have founded and relaunched the bipartisan Creative Rights Caucus with my Co-Chair, Representative Drew Ferguson of Georgia. This caucus will continue to work to protect the rights of content creators and I look forward to working with you to further this goal. I also ask for unanimous consent submit for the record testimony from the Screen Actors Guild and the American Federation of TV and Radio Arts (SAG-AFTRA), which represents 160,000 hardworking professionals in the entertainment industry. And as Chair I say, so ordered. So now for my question. Ms. Karas and Mr. Elrod, I am proud to have introduced H.R. 4750, the Performing Artists Tax Parity Act of 2021. This legislation would modernize the qualified performing artist tax deduction to ensure that more creative workers can seek employment without facing steep personal expenses. Now, I am proud to have pushed for relief for performers. For instance, for the Gig Worker Pandemic Unemployment benefit and for the Mixed Income Unemployment subsidy which were successfully included in our legislation to relieve us on the pandemic. And I am also proud that this Committee supported theaters and venues through the Shuttered Venue Operators Grant. But we must do so much more to support the actors, musicians, and artists who make performances so incredibly special. The Qualified Performing Artist tax deduction has not been updated in decades and currently does not meet the needs of performers. So Ms. Karas, can you talk more about the purpose of this tax deduction and why we need legislation to modernize it for today's economy? And Mr. Elrod, I have heard from so many performers who have to pay for extra expenses, like photo and makeup and still not get the job necessarily. Can you tell us your stories about the expenses that performers have to face? Ms. Karas? Ms. KARAS. Thank you very much, Congresswoman Chu. You know, we also thank you for your introduction of this bill, H.R. 4750 and the support that we have gotten so far. PATPA is a correction to an unintended consequences of what happens when a bill is created by a president, in this case Ronald Reagan, recognizing the value of entertainment workers in the code and the provision itself was not indexed for inflation. Congress saw fit to leave it in the code with the last Tax Cuts and Jobs Act tax bill and we were grateful for that but we realized that the modernization is long overdue. What this bill dies is it levels the playing field by equalizing the income that people who work in the performing arts have against people who do not work in the performing arts. I will just give you a little example. You and I are both single and I am in the performing arts and you work in an office. And we both earn $80,000. But I am spending about 25 percent of my gross income to pay my agent, my manager, to look for work, transportation, continuing education and classes, some equipment, and especially during the pandemic, we have all had to buy---- Ms. CHU. Ms. Karas, I would like to give time for Mr. Elrod also to say something. Mr. ELROD. Thank you very much. I would simply join Ms. Karas in everything that she was saying. And just on a personal anecdotal note, of course the challenges of the pandemic have increased personal costs even while we suffered 15 months and more of total unemployment, we are expected to have the highest quality Internet, the highest quality computers and cameras and microphones. And for the little work that we are able to do during this time, we are still paying 10 percent agent commissions. So there are lots and lots of out-of-pocket expenses that performing artists have to take on. And they have actually increased during one of the hardest moments for us. And so something like the passage of the bill that you have introduced would help us out a lot. And thank you for introducing it. Ms. CHU. Thank you so much. My time has expired. And now the gentleman from Pennsylvania, Mr. Meuser is recognized for 5 minutes. Mr. MEUSER. Thank you, Madam Chairwoman. I thank our Ranking Member very much, Mr. Luetkemeyer, for bringing us all together. Very interesting subject. Thank you for all being here. So I want to just talk a little bit initially about the general business concerns that your industry has and you as proprietors and entrepreneurs and stakeholders. You know, obviously education to create your best workers, your staff, your talent, education these days is unbelievably high, very expensive both public and private. So skills development must be a challenge. Taxes, certain in New York and other cities are crazy. And the idea of increased tax on small businesses does not in my view help at all. Keeping your employees happy, healthy, but as well, safe. You know, because I want to ask about that a little bit, how public safety weighs in here. Access to capital, very important. Your cash flow. You have all been talking about that. Technology I made a note of but that is something a little bit different. Capital investment was mentioned about the ventilators just came up briefly. What sort of additional capital investments were made to handle COVID and just matters moving forward. I think people are just generally more health conscious. And your product, of course, creating that. And your customers. Now, I understand, see, you folks were shut down, or Broadway. I am relating this somewhat to Broadway. I cannot speak for Branson. Shut down for about 18 months, I believe. Now, Japan was shut down for 6 months, UK was shut down for 12, and yet even with that build up, you are getting about 66 percent of capacity now. And Japan was very big on the whole ventilator plan. UK to an extent. They were trying to catch up afterwards. I am not so sure what was being done on Broadway and Branson and L.A. and other places. But the thing is this, look, probably everybody on here has seen The Phantom, seen Hamilton, seen Wicket and Jersey Boys and love the theater. So we are very much advocates and proponents of doing what it takes to help bring this extremely important industry back. I mean, I have a daughter that lives in Manhattan and all that is very important. So the thing is, I want to ask, what would you like to see? Besides additional PPP or even if that is necessary, or the Shuttered Venue program, what would you do differently? I mean, Monday morning quarterback is easy. What would you do? What is your plan moving forward? Where can we be of assistance? Because it is also notable that, for instance, the NHL, indoor, larger arena, understand, but they have had a record year. And yet, our entertainment industry is struggling big time. So I will ask Ms. Presley. I know you are Branson, and Mr. Elrod, I would like to ask you, what have we learned and what should we do moving forward that will be favorable to you all and to your business? Ms. PRESLEY. Well, thank you, Congressman. I appreciate the question. It is a difficult choice. There is no way around that. I think consumer confidence is really where we are focused as an association with NIVA. As we have talked about, my business is here. We are looking out for our guests and our customers and our employees. We are encouraging masks and we are encouraging vaccination but that is where we are here in Missouri. For other venues across the nation there are multiple, multiple, rather different views of this. And of course, going forward with COVID it is very hard to know. Mr. MEUSER. And Ms. Presley, I am sorry. I probably had too long of an opening. Mr. Elrod, could you speak upon New York? Mr. ELROD. Thank you very much. I think the short answer is would it not be great to have a secretary of Arts and Culture? You know, when we have agriculture and it is in trouble, there is a secretary of Agriculture to say, ``Okay, this is what needs to be done. Let's take a deep dive analysis.'' If we had a secretary of the Creative Economy or Arts and Culture, somebody at the executive level on the Domestic Policy Council who could say, ``All right, look at this $919 billion industry and this 5.2 million person workforce, look at the jeopardy they are in. Let's develop together the guidance of what to do.'' Right off the top of my head, obviously continuing robust unemployment for the nation's arts workers would be fantastic. Mr. MEUSER. Thank you, Mr. Elrod. I am running out of time. I will make that recommendation to our governor of Pennsylvania. And I do believe in the Film Tax Credit and your industry. So thank you very much. I am sorry, Madam Chair. I yield back. Ms. CHU. The gentleman's time has expired. And now the gentleman from New Jersey, Mr. Kim, is recognized for 5 minutes. Mr. KIM. Thank you. Thank you, Madam Chair. I would like to start, Madam Chair, by just asking unanimous consent to enter a letter from Our Pride New Jersey into the record. Ms. CHU. So ordered. Mr. KIM. Thank you. Our Pride New Jersey is based in Burlington. It is in my district. And pre-COVID, there were over 19,000 arts-related businesses in New Jersey that employed more than 80,000 people. In our state, every art and cultural patron spends over $33 in local economies each time they purchase a ticket for a cultural event. And that translates into over $662 million each year in economic impact when cultural venues are fully in operation. So the creative sector clearly is having a real impact in terms of creating jobs and economic activity. But I also want to focus on another element here, which is that it has an impact on our kids. And they have been through an awful lot over the last couple years. Back in April I met with the Burlington County Regional Chamber of Commerce. And they connected me with an organization called Morristown Theater Company in my district. As a nonprofit arts organization without their own building, they were not sure if they were eligible for the Shuttered Venue Operators Grant. They had to get extra creative during the pandemic, even producing shows out of a parking lot. My office was able to work with them to confirm that they were eligible and encourage them to apply. They ended up getting a $200,000 grant. They also utilized the EIDL, the PPP, employee retention credits, and assistance form the New Jersey Economic Development Authority. They report that this grant, along with others, allowed them to keep their doors open and to keep their work going forward. Just yesterday, I checked in and they were starting rehearsal for an upcoming production of The Little Mermaid which they are working on with a lot of little kids in the community. And the kids are incredibly excited that we are doing this hearing today and shining a light on the arts and about how it impacts them. I want these kids and kids all over the country to know that we are listening to them. That we understand that this is not just about business. It is about our development and it is about our education to our kids as well. So I just wanted to throw this out there. You know, Ms. Garrett, I know your organization works with professional artists. But if you are any of the other witnesses would like to speak to the importance of the arts for our children, what they have missed during this pandemic, and the benefit of investing in the arts, experiencing the arts education for our children and our families, and what it is that we could try to do to just try to make up for this lost time in terms of being able to give your kids that opportunity to experience arts but also to be able to participate in it. So I just kind of wanted to open it up if anyone wanted. Ms. Garrett, if you wanted to start off. Ms. GARRETT. I thank you for the question. You know, numerous studies have shown repeatedly that arts education increases student engagement, helps them learn positive habits and attitudes and creativity and creative problem solving and teaches critical intellectual skills and observation and helps them learn languages and mathematics and helps them practice teamwork and all of that. OSF has been a leader in arts education for more than 50 years. And like I said during my opening statement, you know, we have 2,300 education and engagement programs that were completely shut down but served communities across the region. We have students that come in from all over the West Coast to watch our plays, to learn something from our artists, to engage in activities around creative art making. And the loss of that is twofold. The first is that you lose access to all of those wonderful things that we all get, we all benefit form when we learn in arts education programs. But you also lose that pipeline. I started in arts education programming. Most of us who are arts workers did. We started there. We learned about a craft and we continued to focus on it until we mastered it. And so without introducing children, you do not have enough people on the other end who are really interested and engaged. And here is the thing. Most of us in the arts creative economy, we have transmittable skills. Carpenters can work in construction. I run a multi-million dollar, multi-lateral business. I can be a CL of a different kind of company. You know, you have to sort of thing about it like that, that we give our skill set to this industry so that everybody can benefit from it. Mr. KIM. I think what you raise there about the pipeline. What you raise there about the pipeline is great. And the last thing I will just say and I will close is that, you know, I also felt like with my own kids, I have a 4-year-old and a 6- year-old, that getting them to engage back in arts has been a way to socialize them back into society after, you know, specially half my 4-year-old's life has been in a pandemic. And getting him to go and sing and dance and other things like that has been so rewarding. So thank you for what you do. And Madam Chair, I turn it back to you. Ms. CHU. The gentleman's time has expired. And now the gentlelady from California, Ms. Young Kim, is recognized for 5 minutes. Ms. YOUNG KIM. Thank you, Chairwoman, and Ranking Member Luetkemeyer, for holding this hearing. I want to thank all our panelists for your time and engaging in our conversation with us. First, Ms. Presley, in your testimony you indicated that your business is struggling with the increased cost of goods because of inflation. So can you look at your list of expenses and tell me which are the biggest price increases that you have noticed in the last 6 months. And as you know, I say this because these price increases, the inflation, it is expected to persist until well into the middle of next year. So I wanted to hear your thoughts and elaborate how this is going to affect your business and your planning. Ms. PRESLEY. Thank you, Congresswoman, first. I wish I could say that I exactly know. We are dark right now and we will open again in March. But I certainly see increases coming and shortages as well of the type of merchandise that we sell. I see that in terms of our concession supplies. We saw that last fall. Not only just price increases but we saw inability to secure cups and different things that we need for our business. We know that is real. It is unknown yet in terms of insurance costs but we anticipate that that may happen as well. It is not any one thing I would say. It is just cumulative and when you run a small business like our independent venues do, it is the cumulative things that actually are most difficult to manage. Ms. YOUNG KIM. Sure. Well, thanks for your answer. I asked that because if the businesses have to plan and deal with inflation well into next year and beyond, it is clear that the problem is not transitory and we have to deal with it; right? So I just wanted to ask that. But I also want to ask a question to you, Ms. Presley. I was intrigued by the statistic that you quote that for every dollar spent at a small music venue, $12 of economic activity was generated for area businesses. Can you elaborate on that study and share with us your unique experience with the local economic ripple effect of Presley's Theater in Bronson? Ms. PRESLEY. Well, thank you. Yes, I mean, I suspect if you think back about the last time you took a vacation, you very seldom go to do one thing and then leave. So we are cognizant that when our visitors come to Branson, it is usually a visitor party of about 3-1/2 people and they spend over $1,100 inside our community to do things. They buy gas. They eat at the local restaurant. They for certain go shopping. They are likely to see more things. People tend to see over three shows when they come to Branson, Missouri. So I see this with all of our independent venues and small businesses, whether you be rural or urban. You go downtown Chicago, you are going to see something fun at a music venue but you are going to stop before and after. Maybe you are going to have a drink. You took an uber to get to your destination. I think that it is easy to see how we are able to multiply the $1 into economic numbers that enhance our entire community. Keeps people employed. Ms. YOUNG KIM. Thank you for your answer. You know, like Ms. Judy Chu, I represent the State of California where we have Hollywood and movies and entertainment is really the key, one of the key industries in our state and we welcome everybody and we can really expand on that dollar spent and generate that economic activity that we talked about in Missouri. The next question I would like to ask is to Ms. Garrett. An ongoing theme that we have explored in this Committee is the supply chain crisis. Businesses, especially the small businesses, are unable to source goods necessary to create their products or deliver goods to anxious customers because of the supply chain crisis. And I realize that your businesses, live entertainment is not a good space business. But have you seen any impact in this regard in the live entertainment realm? Ms. GARRETT. Oh, yes. Thank you very much for the question. So because of the surge and consumer demand and COVID warehouse closures, we had a whole myriad issues trying to open up our shows last year and we know we are going to move into the same problems this year. Cardboard, lumber, containers, trucks, workers, paint. We canceled early performances because of supply chain issues for our winter show. And people went on stage with paint still being wet. The lumber did not arrive in time. It was still sitting out on the water. The molding company had a COVID issue so they were not able to get things through the supply chain. And this is going to be ongoing. And after nearly 2 years of expenses with no audience revenues, the performing arts will find themselves facing outsized restart costs. Ms. CHU. The gentlelady's time has expired. And now the gentleman from Pennsylvania, Mr. Evans, is recognized for 5 minutes. Mr. EVANS. Thank you, Madam Chair. Ms. Karas, I hope I get your name right, you submitted testimony to the House Ways and Means Committee regarding your views on the Qualified Performance Arts Tax deduction, a portion of the Tax Cuts and Jobs Act. Would you mind elaborating on the effect that this tax increase has had on working middle-class artists? Ms. KARAS. I appreciate your question, Mr. Congressman. The very short answer is it has been discouraging. A lot of our performing arts colleagues have decided to leave the business because they can no longer sustain the out-of-pocket costs to remain viable. So they have taken other jobs. They have gone into other work. And it has been unfortunate that they have had to leave the industry. Those who have stayed have struggled because as I was saying before, to have to spend your out-of-pocket money, a write-off of your gross income and then be taxed equally the way someone else with the same wages you have is you are starting behind already. So, for example, if I spend 25 percent of my gross income on my out-of-pocket show business expenses just to stay viable and another taxpayer with the same wages does not have it, we are taxed the same but I have fewer dollars to spend on my home, my rent, my utilities, my medical care. If I have a family, on any of those costs. It is very discouraging. So we are hoping that the Performing Artists Tax Parity Act will get passed with all due speed to put us on a level playing field with taxpayers who have the same income but do not have to spend the same amount of money to stay in their jobs. This is vital. And you know, the Tax Cuts and Jobs Act really stressed tax relief for working middle-class taxpayers. So this is all we are asking is to be on a level playing field, to pay our fair share of tax, no more, but certainly no less. Mr. EVANS. I would like to ask you a follow-up question. One of our largest exports is entertainment. Can you talk about how important it is, both for America and for the rest of the world, that we support the creative economy for this reason? Ms. KARAS. Thank you. Yes. It is rather astounding, the export of entertainment around the world. Those of us who are in the United States take it for granted that we can just have all of this content at our fingertips. A lot of it is recorded. Much of it is live. Some of the live has been streamed over the pandemic. But when you think of the amount, the billions and billions of dollars that is sold internationally, it is astounding. Code Section 181 to help the employers, the production costs, the tax subsidies, you know, we would hope that the cap would be raised on that at some point to help those employers because the more help they have, the more production they generate. Well, as I said before, 4.3 percent of the GDP is the entertainment sector. That is astounding. Most people do not even think about it because it is ephemeral. There is no durable goods there. So we are thankful for the support and we hope for all of it from this Committee as well for the PATPA so that we can enjoy the same level of spending if our tax burdens are equalized with those who do not have the burdens that we do. Mr. EVANS. Very quickly I would like to follow up with Mr. Elrod on that same question and his response to it. Mr. Elrod on that question? Mr. ELROD. I think what is important is obviously there is the socioeconomic or the economic impact of the export but there is also the identity of America and the idea of American soft power throughout the world. As people consume our content, our movies, as they visit our cities, 68 percent of all tourism is for arts and cultural activities. When people come here from around the world and they take part in our creative economy, it gives them a sense of pride and wonder and awe about the power and strength of America inside their collective imaginations. And then they take that back throughout the world. Ms. CHU. The gentleman's time has expired. Mr. EVANS. Thank you, Madam Chair. Ms. CHU. Thank you. And now I recognize the gentlelady from New York, Ms. Tenney, for 5 minutes. Ms. TENNEY. Thank you, Madam Chair, and Ranking Member Luetkemeyer. And thanks for holding this hearing. And we appreciate the insight and time of the witnesses as well. And I am honored to represent Upstate New York, which has a strong history and culture relating to the arts. I also always wanted to be an artist, but here I am, a politician now. We need a very strong ecosystem of manufacturers, designers, venues that serve artists and musicians in our greater community, including many historic sites. A lot of people do not realize that my hometown of Utica is where Dick Clark went to school and got his start. Annette Funicello of Mouseketeer fame. Joe Bonamassa, the great musician, Sawyer Fredericks, and so many others have come from our small city, our region, who have done an amazing job. But another thing is on the manufacturing sector, a lot of people do not realize that the golden artist colors you see when anyone who is an artist knows what they are, were actually started in my district in New Berlin--we say New Berlin, not New Berlin--New York. And I have provided a wide arrange of oil, acrylic, watercolor paints for earnest for many years. We also have a lot of printing companies, including my own, but another one I would like to mention is Curcio Printing in Vestal, New York, where there is a lot of graphic design. And people do not realize I owned a newspaper, but there is a lot of artistic venues with newspapers, designing ads designing creative production items for customers. And we did a lot of that. My concern is that in so much of this, and what has happened in my community with these great venues and great artists, is during the pandemic these industries have suffered. If they had not been designated essential, they were forced to shut down, forced to lose. And thankfully for the PPP program we were able to get some back. But a lot of these lockdowns are continuing. And even in an unscientific way which is really put I think a real problem with especially a lot of our event spaces which we have many people who come to perform in our region. And it concerns me that if we continue with these lockdowns, we are not going to get the reopening and the need for even performing artists, musicians, and others to be able to get back on stage and we will have to rely on remote learning. And as we know, there is nothing like being there in person. So I first wanted to ask Mr. Elrod, since you were very passionate about this, I had heard from a lot of these event space owners about the shutdowns or inability to have consistency and what the rules are and how to enforce those and guidance as how to deal with this. From your experience in theater and performance space, do you think that this sort of continuation of this arbitrary decision-making and, you know, this process is helping the creative economy. How would you make a uninformed standard so that everywhere that our artists perform, whether they are in my community or in New York, they know what is predictable and how to invest so they do not waste money on resources. I am trying to protect themselves and their audiences. Mr. ELROD. That is a really good question. And thanks for all that prelude. My first professional job was at the Hangar Theater in Ithaca, New York, so I am familiar with upstate and it is close and dear to me. You know, just anecdotally from my point of view and my experience is at the beginning the shutdowns were intended to keep people safe from the transmission of COVID-19 and those government lockdowns did lead to this 15 to 18 month in forced unemployment for so many arts workers. And again, when we talk about FPUC, et cetera, it was not that arts workers were lazy and did not want to go to work. We could not. So those were the first rounds of shutdowns. Now, the shutdowns that I am experiencing, or at least the ones that I am seeing now, are not necessarily happening because of arbitrary government imposition but because the workforce are getting sick. So like in my neighborhood of Bushwick, Brooklyn, I follow everybody on Instagram and I was going to go see a rock and roll concert on New Year's Eve. Well, most of the staff of the venue got sick. They shut the venue down. And there are a lot of really cool rock and roll clubs, et cetera, that I would love to see. And they are all just closed because---- Ms. TENNEY. Okay. Can I reclaim my time? I just want to say it is great, okay, so your position is the shutdowns. I want to just ask Ms. Presley if you could weigh in on that. You know, on inflation or the supply chain. Representative Kim got into that a little bit with you. Can you just kind of elaborate? Is it just people are sick or is it inflation and supply chain that is affecting your industry? You have got 10 seconds. Ms. PRESLEY. I have to say it is both. We certainly have seen increased illness here this last month but we are hopeful in the next month that we will see some of that wane. But consumer confidence is still the driver and whether or not our visitors feel safe both from the virus and to travel. Ms. TENNEY. Thank you. Ms. CHU. The gentlelady's time has expired. And now the gentlelady form Pennsylvania, Ms. Houlahan, is recognized for 5 minutes. Ms. HOULAHAN. Hi, thank you, Madam Chair. And thank you so much for the panelists and their testimony today. This topic is very, very personal to me because my daughter is, indeed, a director of theater. A professional director of theater. In fact, she worked out at OSF when Bill Roush was there and Jacob Padron is one of her mentors. And so hello out there to OSF. The creative economy plays a really large role in my community, too, with 296 small businesses involved in the arts, entertainment, recreation within Pennsylvania's 6th Congressional District, which is just outside of Philadelphia. And many people have mentioned the Shuttered Venue Operators Grant program having been a lifeline during this time. With that said, especially with Omicron, I know that many business workers in the creative economy are still especially vulnerable during this public health crisis. As Congress is trying to understand the needs for additional COVID relief, I think we need to be smart about improving these programs and learning from the challenges that we have experienced in the programs we have rolled out. With that said, I have heard from employers in my community, like Science Explorers, which is an organization in my district which has applied for the Paycheck Protection Program grant and the Shuttered Venue Operators Grant. The business reached out to my office to express their frustration because the SVOG process was very complex and they found it to be very time consuming and burdensome. So my first question is to Ms. Nataki Garrett. I understand that similar to Science Explorers at the Oregon Shakespeare Festival also applied for both PPP and SVOG grants. Can you please describe your experiences with the Paycheck Protection Program application compared to the Shuttered Venue Operators Grant program. Particularly, I am wondering if there are ways where we could be improving the SVOG program to be streamlined and approved. Ms. GARRETT. Thank you for the question. Just to be honest with you, I think the biggest problem was that there was not enough information. And so our banks did not have enough information and so they could not pass on enough information to us. And then the other thing was the information from the SBA kept shifting. And so we thought we would have something under control and then we were given something else. And then we had to submit this paper and get this thing done. We had a little bit of leeway because we had received some CARES Act funding as well through the state. And so we had a little bit of a buffer but a lot of my colleagues really suffered in that time waiting for information to be clarified. It was different from state to state and it was different actually from bank to bank. And so I think streamlining the process would be really beneficial. And especially if Congress were to be willing to release the $2 billion additional funds that are left over from the SVOG back into circulation to streamline a process so that we could have access to that money, now that we have already gone through a process it would be really, really helpful. Ms. HOULAHAN. Thank you. And my next question is sort of a follow-on to that to Mr. Carson Elrod. You had mentioned in your testimony that the SVOG grants are a lifeline and that live entertainment venue sector is a small fraction of the large and fragile creative economy at large. And so I have heard similar sentiments from businesses like my own, Science Explorers, which was ultimately deemed ineligible for SVOG relief despite having had to cancel 500 programs of their own at the start of the pandemic. How can the SVOG program, assuming that we are able to shake loose some more resources, increase or enhance the eligibility requirements to be able to be improving so that more businesses like that business that I am mentioning could be able to receive the relief that they need in these challenging times. Is there a way to expand the definition or what would you recommend? Mr. ELROD. I recommend doing exactly that. And thank you so much for the question. One of the earliest collaborators we had at Be An #Arts Hero was Brian Blythe. And he works in John Kristiansen's costume shop in Manhattan. And he started the Costume Industry Coalition, which represents over 60 highly skilled, artisanal workers, and their whole job is to supply costumes to the entire ecosystem of the creative economy. That is cruise lines, operas, rock and roll shows, theater. I mean, they are a cornerstone of the creative economy nationally. And they had to close down completely at the beginning of everything. All of their orders dried up. After the short rounds of PPP, they had to lay everybody off. And they have been essentially doing, you know, kind of Go Fund Me and charities. And they were one of the industries that fell through the cracks because the SVOG grants did not really contemplate the entirety of the creative economy. And it is really important that everybody know that that intervention is a watershed moment in American history between Congress and the creative economy. And there is nobody in the creative economy that is not appreciative of what #Save Our Stages and SVOG represents. What would be amazing is to superfund it, expand it, and make sure that it really is a floor for the entirety of the creative economy to get us through this moment and into the next one. Ms. HOULAHAN. Thank you. I appreciate it. My time has run out and I yield back, Madam Chair. Ms. CHU. The gentlelady's time has expired. And now the gentleman from New York, Mr. Garbarino, is recognized for 5 minutes. Mr. GARBARINO. Thank you, Madam Chair. I appreciate the opportunity to speak, and thank you to the Ranking Member for having this hearing today. Mr. Elrod, my question was similar to what Ms. Houlahan just asked. By the way, loved you in Wedding Crashers. I was going to ask you about the other business. I am from Long Island, New York. You know, everybody goes to Broadway. Everybody goes, you know, they come in and they go restaurants and not so we had the Restaurant Revitalization Program that tried to help some of these restaurants. But there are other parts of the creative ecosystem. You just talked about a costume supplier. We had a lot of people that were hurt in New York City when the film industry and Broadway was shut down. Can you go a little further with what you were just saying? You talked about costumes. Who else do we need to expand it to if there was another tranche of money coming, like who was left out? Mr. ELROD. Oh, well, I think that is one of the things where I would like to pivot towards like a GAO report or a congressional commission so that you can hear from more than just four of us. To like really get the Brian Blythes of the world in front of you to like really talk about who was there and who was left out. I think that would be the most important thing to do because I think one of the problems is we do not even know what we do not know as I was saying. The wave has come in and the damage is not yet knowable. Also our NAICS codes do not appropriately include the entirety of the creative economy. And so without understanding the fullness of the creative economy, we also do not know who slipped through the cracks. Mr. GARBARINO. Yeah. So the dust has not completely settled yet and you will not know probably at least until everything is up and running again at full speed, what is missing? Okay. I understand that. I was in the state legislature for New York for 8 years. New York had very generous, I thought, tax program to help bring moves and TV shows to the state to get film credits. Congress here, we did PPP. We did the Shuttered Venue Operators grant program. And there are a couple people from a couple different states here. Can you talk about what the states have done? Because we also sent them a lot of money to help with more local issues and we have Oregon, I think, and Missouri and New York. Have any of those states done anything since the pandemic shut everything down to help your industries in addition to what Congress has done? Ms. Garrett? Ms. GARRETT. Thank you very much for the question. Yes. So very early in the pandemic, a group of arts organizations that were much more highly resourced. Some of our smaller organizations got together and lobbied for CARES Act funding. So we received as a coalition of performing arts theaters, performing arts venues, the ballet, the symphony, the opera. OSF at another theater called Portland Center stage. We lobbied for $8 million in CARES Act funding. And that was actually the thing that buoyed us and actually brought me to lobby with the Professional Nonprofit Theater Coalition, lobby for access to SVOG funding. So once we knew we could do it, we did it again. And we were really grateful for the CARES Act funding. We talked to some of our other colleagues across the country to try to help them figure out ways to lobby for some of those resources. In these times, every little dime, every little bit counts. I also wanted to go back to your question to Carson. There are a lot of theater workers who are not recognized as such-- carpenters, stitchers, ushers. A lot of those folks are only paid when shows are running. And so they were not necessarily affected by industry-specific funds. And so being really clear about the full impact across the industry, you know, our ushers work every single time a show gets up ad they are just as important as the people who stand on page. But there is no way to fund them except through unemployment during the pandemic. Those are the things that we have to think about. Whereas, when we did do the streaming of the shows, we paid everybody. Everybody was a part of this production. We paid every single person. But we were not able to pay the ushers and the carpenters did not receive any kind of funding for that. Mr. GARBARINO. Mr. Elrod, you said you wanted to further answer something? Mr. Carson? Mr. ELROD. Basically, exactly what Ms. Garrett said. I was thinking of the Small Business Committee, so I think I was thinking of small businesses but I probably forgot to leave out the real group of people that has been left out are the arts workers themselves. And that is why expanded unemployment is important. That is why something like the Creative Economy Revitalization Act which would give money directly to arts workers to apply their trade and bring them into the public sphere and make festivals and murals and public works of Art and the Arts education for All Act. There are so many things that are in front of Congress right now that would help so many of those people that have fallen through. And I was embarrassed that it slipped my mind. Of course, the arts workers themselves are the most important people that have kind of been left out of the equation. Ms. CHU. The gentleman's time has expired. And we have now reached to the end of our Member questions. So I will now do my closing statement. I want to thank our panel again for being here today. Your stories of preserving through the pandemic demonstrate the resilience and fortitude of your industry. But it is very clear that you still face many challenges today. For our economy to fully recover, we must work together to overcome the hardships and challenges facing the creative economy. Unfortunately, we cannot reverse the damage overnight. It will take sustained support and investment to bring these businesses back to where they once were. We must work together to advance policies that drive recovery in the near-term and pave the way for future success. The American Creative Economy is one of our most significant resources and we cannot afford to leave it behind. With that, I would ask unanimous consent that Members have 5 legislative days to submit statements and supporting materials for the record. Without objection, so ordered. And if there is no further business to come before the Committee, we are adjourned. Thank you. [Whereupon, at 12:03 p.m., the committee was adjourned.] A P P E N D I X [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] [all]