Special Payments Fund 2
August 5, 2009 in Finding MoneyGet Something From What You're Already Paying For:
Accessing the Special Payments Fund
In a previous article titled "What Can the Union Do For Me? we pointed out a way in which you can benefit financially from the recording of your CD regardless of the number that you sell. Even better, this pool of money is created by the major record labels.
Before you balk at the idea of joining the union, keep in mind that
a) union dues are fully tax deductible and
b) becoming a "union band" does not mean you have to charge a set fee for every gig.
c) right now, there is a special discount on union memberships (you will not believe the price!) and there are many other benefits besides the one we will address today - including pension, medical/dental, insurance, road coverage, etc.)
What exactly is the Special Payments Fund (SPF)?
This fund is created from the sales of major label recordings (every label is required by law to contribute a certain amount), and this pool is distributed to musicians like yourself on the basis of "Sessions Played" (not number of albums sold).
The Money You Put In
These are the rates used for Limited Pressings (2000 units or less), which is what most indie bands manufacture. To access the SPF, you have to:
a) fill out and file a contract
b) use standard union rates to pay your players. The standard "session" rate is $285.47 per player, and the average number of sessions required for an album is 10. Yes, in most indie bands you don't pay yourselves for the recording sessions because you are all paying for the costs of the project. But check out this example.
Costs for an album
4 Players @ $285.47/session x 10 sessions = $11,418.80
Union Dues for 4 players = $480
Signatory Fee $100
Work dues @ 2.5% = $285.47
Pension contribution @ 10% $1141.88
Upfront outlay $1907.35 for 4 members
What You Get Back
The union and work dues are tax deductible (assuming you pay income tax). The pension contribution is in your name. So technically, this money will return to you. Now using the SPF, you will each receive cheques totalling roughly $2000 over the next five years. The first payment is the largest, and then they drop by 20% per year (unless of course you do another album under the SPF- that will increase your pool again).
Again keep in mind that you are paid on the basis of sessions, not sales. If you sell NO albums whatsoever you still receive the same SPF payments. Think of it as a short-term, no-risk financial investment.
If you'd like to discuss this more, telephone (306) 352-1337, fax (306) 359-6558 or email firstname.lastname@example.org. If you are near Saskatoon, call (306) 477-2506. The SPF is just one benefit that the union has bargained for on behalf of musicians, so take advantage of it!