California Legislators Intend to Boost Film and TV Incentives
California legislators are taking significant steps to enhance the attractiveness of the state’s film and TV production incentives. They aim to increase the financial benefits for individual productions and plan to double the current budget allocation for these incentives.
During a press conference held on Wednesday, legislators introduced two related pieces of legislation, AB 1138 and SB 630, designed to elevate California’s competitiveness in the film industry. Notably, speakers at the event pointed out that states like Georgia and New York have been actively improving their incentives, drawing productions away from California.
“We are determined to compete vigorously,” stated Assemblyman Isaac Bryan, a proponent of the Assembly’s bill.
Industry Challenges Highlighted
Alex Aguilar, a business manager at Laborers Local 724, expressed his concern about the dire job prospects for members of the film industry, suggesting they might need to consider different career paths if the situation doesn’t improve soon.
The sentiment was echoed by other industry insiders, noting significant distress within the community, with many losing their homes and leaving California, losing faith in the future of local entertainment jobs.
California Governor Gavin Newsom previously announced in October his intention to increase the incentive program’s funding from $330 million to $750 million annually. However, specifics on program enhancements were not detailed at that time.
The new legislative proposals, introduced by Bryan, Senator Ben Allen, and Assemblyman Rick Chavez Zbur, aim to modernize and expand the incentive program to prevent the relocation of film and TV jobs to other states. The details of these bills are still under discussion, with inputs from various industry stakeholders being considered.
Currently, California offers a 20% tax credit to most productions, significantly lower than the incentives provided by other regions. For example, Georgia and New York offer a 30% rebate, and British Columbia recently increased its credit for international productions from 28% to 36%.
Zbur mentioned that the proposed legislation would not only increase the rebate percentage but also broaden the eligibility criteria to include a wider variety of productions. Presently, the state’s program excludes certain types of productions like animations, reality shows, and game shows, and does not cover TV shows shorter than 40 minutes per episode.
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In a recent interview, Zbur highlighted ongoing negotiations to bridge differences between studios and labor unions. He underscored the severe impact of declining production work, noting that some of his neighbors were earning significantly less than in previous years.
The industry has also been adversely affected by external challenges such as the COVID-19 pandemic and recent wildfires in Los Angeles, intensifying the need for robust support measures.
Zbur emphasized the necessity of passing the legislation to secure the proposed $750 million funding and to ensure the program’s competitiveness with incentives offered by other states. He acknowledged some resistance from Sacramento lawmakers who argue that increasing tax credits for Hollywood could detract from other state programs. However, he countered by pointing out the substantial return on investment demonstrated by the existing program.
The Motion Picture Association has initiated a lobbying campaign, the California Production Coalition, advocating for more favorable terms for productions that qualify for the state tax incentives, including potential allowances for ‘above-the-line’ costs which are currently not covered by the tax credits.
Los Angeles Mayor Karen Bass, instrumental in establishing the state’s film incentives in 2009, reflected on the initial concerns about competition from places like Toronto. She remarked that while initial steps were taken to introduce tax credits, they were not sufficiently agile to keep pace with the rapid developments in other states’ incentive programs.
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With a knack for uncovering hidden gems, Blake dives deep into the world of indie films and underground cinema.