Austin ready to push new tax incentives, grants to preserve ‘precious few’ music venues, iconic businesses

Local band White Denim performs at Cheer Up Charlies in 2017. (Christopher Neely/Community impact Newspaper)
Local band White Denim performs at Cheer Up Charlies in 2017. (Christopher Neely/Community impact Newspaper)

Local band White Denim performs at Cheer Up Charlies in 2017. (Christopher Neely/Community impact Newspaper)

After months of discussion, debate and deliberation by city officials and trying to hang on by music venues and other small businesses, Austin will begin rolling out a handful of programs it hopes will save at least some of its iconic local businesses threatened by the pandemic’s prolonged economic devastation.

Following City Council approval Dec. 3, city staff is preparing to launch two programs, each backed by $5 million from taxpayers, that will send tens of thousands of dollars to music venues and “legacy” small businesses under immediate threat of closure due to the pandemic. The program also offers up to $140,000 over six months for businesses that need it to survive long term. The city has also launched a tax incentive program that will offer music venue landlords property tax rebates in exchange for renegotiating long-term leases with their tenants. At the same meeting, City Council, too, designated $15 million in hotel tax revenue typically allocated for historic preservation to save the city’s most iconic music venues.

Since the end of the summer, conversations around pandemic recovery have centered around city government intervening to save its music venues and legacy small businesses—industries city leaders called crucial to Austin’s brand. However, since the start of those conversations, the same leaders have acknowledged that even the best locally drawn programs could only save a “precious few” businesses, as Mayor Steve Adler said, setting up the city for what Adler called some “horribly difficult choices” around who benefits from the city’s limited dollars.

Businesses that can prove they will close within 30 to 60 days under their current operation may be eligible to receive the emergency $20,000 grant; however, city leaders have long envisioned the program to target the long-term sustainability of the businesses and, thus, their industries. Any music venue or iconic small business—a brick-and-mortar local business that has been open for at least 20 years—that accepts the emergency grant will have to agree, after it receives the money, to undergo a technical assistance evaluation.

That evaluation will be used to determine what the business needs to have the best shot at long-term sustainability. Staff from the Austin Economic Development Department said they were confident In some cases, beyond the $20,000 emergency grant, some businesses might not need cash and instead require accounting expertise, legal assistance or help negotiating with their landlords, which the city would offer through third-party vendors.


In other situations, city staff said businesses might just need cash, in which case they would apply for the larger grant—up to $40,000 per month for up to six months for a total of no more than $140,000.

Which businesses will receive the grant funds remains to be seen, as does how the city will fund the new tax incentive program for music venue landlords. Typically preserved for luring large corporate employers, such as Apple or Samsung, to the city, City Council unanimously approved amendments that would avail its tax incentive program to music venue landlords willing to renegotiate leases with their tenants to situate them long term. However, no funding has been dedicated to the tax reimbursements.

District 4 City Council Member Greg Casar earned some support from other council members for his informal proposal to preemptively appropriate the money from the fiscal year 2021-22 budget and bank on the federal government passing another stimulus bill that would replenish the funds.

“I think we should be expecting [federal] stimulus, but if we wait until the stimulus gets to us, then some businesses might have closed that we wanted to get that money to,” Casar said. “I know it’s pushing it a little bit, but I would hate to wait for the stimulus and then wait a month to develop a program and then take a month worth of applications if we could start providing some relief through the [tax incentives] now and pay for it with the stimulus that comes.”

District 1 City Council Member Natasha Harper-Madison said she wanted to offer help as soon as possible but had some concerns with banking on “the guarantee of stimulus, both by way of the amount and by way of the timing.”

“It doesn’t feel like there is any guarantee, in which case ... if we didn’t get the amount we anticipated in the amount of time we anticipated, what’s our recourse then?” Harper-Madison said. “If we operate expecting to get a thing we don’t have yet, I just worry about the lack of certainty there.”
By Christopher Neely
Christopher Neely is Community Impact's Austin City Hall reporter. A New Jersey native, Christopher moved to Austin in 2016 following years of community reporting along the Jersey Shore. His bylines have appeared in the Los Angeles Times, Baltimore Sun, USA Today and several other local outlets along the east coast.


MOST RECENT

The Highland Tech Center is an office complex that finished redevelopment in March. (Courtesy Aquila Commercial)
North Central Austin business news: Office complex opens in Highland, picnic meals offered in the parks and more

Mes Amis is an outdoor dining service that provides baskets with French-style cuisine for picnics. Two new fitness studios, Hive + Honey and Regymen, are also now open.

Stephanie Hayden-Howard will become an assistant city manager in Austin on May 10. (Jack Flagler/Community Impact Newspaper)
Role changes coming for health officials leading Austin-Travis County COVID-19 efforts

Dr. Desmar Walkes will take over as Austin's next medical director and local health authority as Dr. Mark Escott and Stephanie Hayden-Howard transition to new roles with the city.

Barton Springs Pool, shown here in March 2020, will require reservations for residents wishing to visit after 8 a.m. starting on May 17. (Community Impact Newspaper staff)
Barton Springs Pool will require reservations starting May 21

Visitors who want to visit the pool after 8 a.m. will have to make a reservation for a two-hour block of time.

Road closure stock image
TxDOT to demolish I-35 ramp in North Austin early Saturday morning

State crews will perform controlled implosions of the northbound I-35 to northbound US 183 flyover between 6-8 a.m. in the morning on May 8 and May 15.

A pilot Austin Police Department cadet class is now set to commence in June under an updated training regimen and with additional city and community oversight on the APD academy's culture and curriculum. (John Cox/Community Impact Newspaper)
Austin City Council votes to restart APD cadet training in June, with framework for ongoing reviews of pilot academy

The Austin Police Department's 144th cadet class will now kick off training next month, with continued oversight of APD's instruction and culture throughout the 34-week academy process.

Holland Photo Imaging celebrates 40 years in business this year. (Courtesy Holland Photo Imaging)
The latest business news in South Central Austin

1. Holland Photo Imaging, located at 2125 Goodrich Ave., Ste. A, Austin, is celebrating its 40th anniversary in the community this year. Founded in 1981 by Pete Holland, the business has been owned by residents Brian and Morgan Morrison since 2006. Holland Photo Imaging offers film processing, printing, framing, photo restoration and archiving services. 512-442-4274. www.hollandphoto.com

A sign advertises a property for rent in Austin on May 6. Local eviction orders remain in place through August 1 protecting most tenants from eviction. (Jack Flagler/Community Impact Newspaper)
Local eviction moratoriums remain in effect despite federal judge’s decision

The May 5 ruling from a U.S. District Court judge striking down a federal moratorium does not affect orders in place in Austin or Travis County.

Q2 Stadium in North Austin
U.S. women’s national soccer team to debut Q2 Stadium next month

The USWNT takes on the Nigerian national team at Q2 Stadium ahead of the summer Olympic Games.

Juneau was adopted at Austin Animal Center in November 2019. (Amy Rae Dadamo/Community Impact Newspaper)
Austin Animal Center reaches critical capacity, opens doors to all adopters for first time since May 2020

Austin and Travis County’s animal shelter, Austin Animal Center, reached negative kennel space May 4, meaning there are more dogs than available kennels, according to a release from the city of Austin.

Residential appraisal valuations have been sent to Travis County property owners. (Iain Oldman/Community Impact Newspaper)
Travis Central Appraisal Districts says hot housing market is reflected in 2021 appraisals

Property owners have until May 17 to file a protest of their home's appraisal.

Photo of the exterior of La Barbecue
La Barbecue opens new space, plus six more new Austin restaurants

Downtown Italian and Greek eateries are among those joining the Austin restaurant scene this spring.