Mayor Steve Adler recently announced a new plan for a $10 million bond that will sustain local music venues facing surging rent in Austin and stimulate economic development in the city’s industry.
In a partnership with San Francisco-based startup Neighborly, the money will be crowdsourced from various investors and will primarily be used to purchase and preserve
“Austin won’t be the Live Music Capital of the World if we keep losing music venues,” Adler said. “Now, thanks to Neighborly, we have a way to do something about it.”
James McIntyre, head of public finance for Neighborly, said the creativity and history of civic involvement in Austin won the city the bid. While the money has not come in yet, Neighborly will help Austin raise the funds necessary to get the bond off the ground.
Cole Gerthoffer, radio-television-film junior, is a member of the band Bronco Simmons, which performs in venues around Texas, such as Austin’s Scoot Inn. Gerthoffer said the money should go to local and independent music venues to protect them against corporations wanting to buy them out.
“What’s hurting are the small venues, because someone can’t afford to pay their rent because someone wants to out-buy them to put up a high-rise,” Gerthoffer said. “If they really want to benefit the city of Austin, they should focus on smaller, independent music to really maintain the culture of live music the city is known for.”
The $10 million is an estimate based on the resources the city has at its disposal, Stanford said.
“The problem isn’t going to be selling enough bonds,” said Jason Stanford, communications director for the mayor. “It’s going to be the infrastructure around it.”
Investors will put money into the cause as a whole, not specific venues, Stanford said. The investors will likely have very little input on which venues receive the money. That will be designated to a board or another type of managing body.
“It’s going to be some sort of board, a group of people who are qualified to make these decisions in a professional way,” Stanford said. “There might be government people on the board, but it won’t be a government board.”
This investment will be long term, with people buying shares just like any other investment. It is unclear at this point as to whether people will invest in the brick and mortar of the venue or the entire brand.
“At the bare minimum, [the city] bringing attention to this is a huge deal, and it deserves to be commended,” Gerthoffer said. “It’ll all depend on if they can actually put up what they say they’ll do.”
Nick Roseman is the manager of The Local on Guadalupe Street. While he had not heard of this specific bond, Roseman said the music venues of Austin are facing
“This city is built on a tradition of live music, and it’s gotten to a point where rent has gotten out of control,” Roseman said. “Bands are putting in a lot of work and they’re not getting paid. They’re not getting paid a lot. If they’re not getting paid, it’s not going to happen, and then we’ll just be Forth Worth.”