Understanding California Government Code Section 12098.9
While many ticket laws focus on consumer restrictions and regulations, California Government Code Section 12098.9 is all about injecting financial support into the live entertainment ecosystem. This legislation officially establishes the California Music Festival Preservation Grant Program. The primary goal of this initiative is to financially back independent live music promoters so they can continue offering all Californians equitable access to the arts.
Sources & References
The information on this page was was sourced from:
Section 12098.9, California Government Code: The official code establishing economic development programs within the Governor's Office of Business and Economic Development.
CA Senate Bill 370 (2025-2026 Regular Session): The legislative act creating the California Music Festival Preservation Grant Program and allocating funding to eligible independent live music promoters.
Who Administers the Festival Grants?
The grant program is housed within the state's office and is managed under the direct authority of the director. This office is responsible for overseeing the administration and allocation of the grant money to qualifying independent promoters.
The $20 Million Funding Allocation:
Subject to official appropriation by the state Legislature, the program dictates that twenty million dollars ($20,000,000) will be set aside for these grants. The office is authorized to distribute these funds to qualifying independent live music event promoters across one or multiple funding rounds.
Who Qualifies as an Eligible Independent Promoter?
Not just anyone who throws a backyard concert can claim a piece of this grant money. The state has established a rigorous legal definition for what constitutes an "eligible independent live music events promoter". To secure funding, an organization must check every single one of the following boxes:
Approved Business Structures:
- The entity must be legally structured as a sole proprietor, a C-corporation, an S-corporation, a cooperative, a limited liability company (LLC), a partnership, or a limited partnership.
- Alternatively, the promoter can operate as a recognized nonprofit organization with federal tax-exempt status under Section 501(c)(3) of the Internal Revenue Code.
Core Business Activities:
- The organization's principal business activity must be actively managing, hosting, producing, organizing, or promoting live concerts, festivals, or other performing arts events.
Strict Venue and Payment Rules:
- The events must be held at eligible venues that implement a cover charge, either through formal ticketing or a front door entrance fee.
- It is explicitly required that the performers playing at these events are paid for their work.
The 70 Percent Revenue Threshold:
- To prove that they are genuinely dedicated to the live event space, promoters must show that a vast majority of their income comes from these shows. Specifically, at least 70 of the entity's earned revenue must be generated directly from event-related streams.
- Qualifying revenue streams under this rule include ticket sales, cover charges, producti on reimbursements or fees, and the on-site sale of merchandise, food, or event beverages.