American Rescue Plan: No Funds for Gyms
Restaurants and performance venues got special funds in the American Rescue Plan (New COVID-19 Relief Bill), but the two congressional representatives who proposed $30 billion for gyms and fitness studios as part of this bill have their work cut out for them as the idea still hasn’t taken off.
President Joe Biden has signed the $1.9 trillion American Rescue Plan into law (COVID-19 Relief Bill), and much to the disappointment of the gym and fitness studio sector, a proposed $30 billion recovery fund aimed specifically at the pandemic-battered industry is not part of the package.
The International Health, Racquet & Sportsclub Association had championed the Gym Mitigation and Survival Act, co-sponsored by U.S. Reps. Michael Quigley (D-IL) and Brian Fitzpatrick (R-PA).
The Act would provide a recovery fund specifically for the fitness industry in the form of Small Business Administration grants that could pay for payroll, rent, mortgage, utilities, insurance and other expenses fitness facilities normally incur.
The American Rescue Plan passed without assimilating any of the GYMs Act’s provisions.
“We knew it was going to be a longshot to get included in this bill,” said Brent Darden, IHRSA interim president and CEO. “Given the timing and the restrictions as far as adding amendments to the bill.”
He added that industry leaders and fitness studio owners “need to continue reaching out to our representatives, and keep telling them how much clubs in their communities need targeted relief.”
The massive American Rescue Plan, which passed by party lines, does include funds marked for other kinds of businesses hit especially hard by the pandemic, including $29 billion for restaurants and $15 billion for performance venues.
Perhaps gym and fitness studio owners could apply for help with the Paycheck Protection Program.
The American Rescue Plan provides another $7.25 billion for the Paycheck program, which offers loans to small businesses of all stripes.
The loans can be forgiven if at least 60 percent of the money goes to support payroll expenses and the rest to categories on a list of allowable expenses (like mortgage interest, rent, utilities and personal protective equipment).
Fitness businesses had an underwhelming reaction to the program when it passed in the first coronavirus economic relief package last year. Many studios that utilized independent contractors as instructors were ineligible. Some felt the money did not stretch far enough as closures and reduced foot traffic extended through the year. Others were dismayed by the application process.
On that note, if you want to try for PPP loan, act today. The bill still allows the program to end on March 31 and there is already a backlog of applicants.
The final numbers from an IHRSA analysis of payment processing showed that the fitness industry had a catastrophic year. Industry revenue plummeted in the U.S. by 58 percent in 2020 when compared to 2019, leading to 17 percent of facilities closing permanently and more than one million employees losing their jobs. The organization warned since the summer that the erosion of the industry could be permanent without a federal lifeline.
