State expands tax credit for film production

Staff and Wire Reports

HOLLYWOOD — Joined by state legislators at Sunset Gower Studios, Gov. Gavin Newsom signed legislation July 21 to expand California’s Film and Television Tax Credit Program by $330 million to attract more production jobs to California.

California’s iconic entertainment industry is a point of pride that creates important revenue and opportunity for workers, businesses and communities across the state,” Newsom said. “Today’s investments ensure film and television production will continue to fuel the California Comeback through thousands of good jobs right here in the Golden State, training opportunities to increase access, and a focus on fostering diversity and inclusion for a workforce that better reflects our vibrant communities.”

The expansion includes a condition for recipients to provide aggregated data on the diversity of their workforce, including gender and race, and to submit a plan with diversity goals to the California Film Commission.

[Senate Bill] 144 preserves both recurring and relocating television and streaming series, creates a new program that incentivizes private investment in construction of soundstages and establishes new benchmarks and commitments on diversity,” said Charles Rivkin, chairman and CEO of the Motion Picture Association.

The legislation was authored by state Sen. Anthony Portantino, D-La Canada Flintridge; Assemblywoman Wendy Carrillo, D-Los Angeles; and Assemblywoman Autumn Burke, D-Inglewood. The expansion includes a $180 million increase over two years and a one-time $150 million incentive to be used over multiple years for the construction of soundstages in an effort to keep up with infrastructure demand.

Investing in new soundstage construction is a critical addition to our efforts to increase filming in our Golden State,” Portantino said.

Modernizing our studio infrastructure and achieving diversity goals will ensure that future entertainment careers will flourish in California and generations of people from across the country will continue to see our state as the entertainment capital of the world.”

Since the start of the coronavirus pandemic, the tax credit program has provided $335 million to 48 projects, and 27 television series have left other states and nations to relocate to California since the program launched in 2009. Officials say the program has generated nearly $18 billion in production spending.

“SB 144 is historic legislation that ties the expanded TV & Film Tax Credit in the California State Budget to equity workforce plans and incentives to be more reflective of the people of the state,” Assemblywoman Carrillo said. “This agreement encompasses efforts to expand production, bring projects back to the state, and deliver equity in both above-the-line and below-the-line industry jobs.

“Film and television are part of California’s DNA and representation matters. Audiences reward diverse productions financially, and above and below the line workers spend their earnings in the communities where they live. Diversifying the workforce means bringing equity to the economy, and strengthening the tax base.”

These strategic investments reaffirm the Golden State’s role as a leading player in the global entertainment industry — a vital sector that represents billions in wages and revenue for California workers and businesses,” said Dee Dee Myers, director of the Governor’s Office of Business and Economic Development.

The film and television industry provides California with more than 134,000 production-related jobs, more than 83,000 distribution-related jobs and more than 643,000 related jobs for vendors and businesses.

“The Hollywood tax credit will spur hundreds of millions of dollars of construction at our world famous entertainment studios providing opportunities for our diverse apprentices, 72% of whom are people of color,” said Robbie Hunter, president of the State Building and Construction Trades Council. “And this credit will take the additional step of creating opportunities for traditionally underrepresented young people to learn to be the next generation of TV and film producers.”

The Entertainment Union Coalition, which represents 163,000 members of the California IATSE Council, the Directors Guild of America, LiUNA! Local 724, SAG-AFTRA and Teamsters Local 399, celebrated the expansion.

SB 144 enhances and improves the California Film and Television Tax Credit Program which since its inception has resulted in the creation of 156,000 below-the-line cast and crew jobs and has generated $18.4 billion in direct revenue for our state,” the coalition said. “SB 144 ensures that our members can remain working in California and that more productions will be able to shoot here for decades to come.”