A session introducing California’s newly expanded and extended filming incentive program drew a capacity turnout earlier this month at the Association of Film Commissioners International (AFCI) Locations Show 2015 in Los Angeles. Amy Lemisch, executive director of the California Film Commission (CFC), which administers the incentives tax credit initiative, and program director Amy Stone, also of the CFC, made the presentation.
Among the highlights of what is now known as California’s Film & TV Tax Credit 2.0 are: Program funding has been increased from $100 million to $300 million annually; eligibility has been expanded to include big budget features, one-hour TV series (for any distribution outlet) and TV pilots; budget caps have been eliminated for studio and independent films yet while there are no caps, the tax credit program will apply only to each project’s first $100 million in qualified spending (for studio films) or the first $10 million (for indie films); the existing tax credit lottery is being eliminated as projects will instead by selected based on a “jobs ratio” formula and other ranking criteria; penalty provisions have been set for projects that overstate job creation; the single allocation period annually will be replaced by multiple allocation periods throughout the year (application period schedules and instructions are being developed); and a 5 percent “uplift” has been established for productions shot outside Greater L.A.’s 30-Mile Zone, as well as for visual effects and music scoring/recording performed in-state.
A 20 percent tax credit is in place for qualifying in-state spending on non-independent productions, including features, movies of the week and miniseries, new TV series and TV pilots, with 25 percent allotted for indie projects and relocating TV series (for their first year filming in California). To be eligible, 75 percent of a project’s principal photography days or total budget must take place or be spent in California.
Producers tapping into the tax credits must also engage in educational/training opportunities for high school and community college students. This can take the form of providing paid or unpaid internships or apprenticeships; conducting workshops, lectures or demos; making financial or equipment contributions to a school or program; and producing extracurricular resources such as how-to videos.
A restoration of funding in Nevada?
Last year a major Nevada filming incentives program had its funding cut dramatically–from $80 million to $10 million covering a four-year period which began in January 2014. Catalyst for the cutback was legislation which provided Tesla Motors with more than $1 billion worth of financial incentives in exchange for the company bringing its battery factory to Nevada. To help offset the cost of the Tesla package, state legislators made other cuts, including $70 million in film subsidies.
However, a bill has been introduced in Nevada’s legislature which would restore the original filming incentives program funding. The measure is currently under consideration, according to a production incentives update presented by Joe Bessacini, Cast & Crew’s VP of film and TV production incentives, during an AFCI Locations panel discussion. Later, on the AFCI Locations exhibit floor, SHOOT received confirmation of the state bill from Eric Preiss, director of the Nevada Film Office.
Preiss noted that the current session of the Nevada legislature, which began in February, runs through May. The Nevada Film Office is waiting to find out the outcome of the bill which, if passed, would restore the original level of funding for the state filming incentives program. Once the decision on that bill is made–one way or the other–Preiss said that the Nevada Film Office would formulate and implement its big picture plan accordingly, doing the best it can to attract, retain and serve producers filming in the state.
Under the incentives program, companies that spend a minimum of $500,000 and shoot at least 60 percent of their project in Nevada are eligible for a transferable tax credit of 15 to 19 percent of qualified production expenditures. The film incentives package applies to projects ranging from theatrical features to TV, commercials, digital content and branded entertainment. The minimum threshold of $500,000 can be reached cumulatively, meaning that multiple commercials or pieces of branded content, for example, shot in Nevada during the course of the year can collectively qualify for the tax credit.
Show-Me State
A Missouri Senate Bill proposes to create a new film incentive program, which allows for a transferable tax credit equal to 20 percent of qualified expenses.
Other provisions of the proposed program include: an additional 5 percent may be earned on all qualifying expenses if at least 50 percent of the project is shot in Missouri; an annual funding cap of $4.5 million; a new sunset date of November 28, 2021; an exclusion of all compensation and wages paid to an individual earning more than $250,000; and the required inclusion of a statement or a logo about Missouri in the screen credits.
