A group of Los Angeles-based California legislators have introduced bills in the state assembly and senate to expand the Golden State’s film and television tax credit program, marking the next step in a campaign to halt the flight of productions to other states and countries that was launched by Gov. Gavin Newsom last fall.
State Sen. Ben Allen, whose district includes the wildfire-destroyed Pacific Palisades, introduced the bills at the SAG-AFTRA headquarters alongside assembly members Rick Chavez Zbur and Isaac Bryan, whose districts include the Paramount and Sony backlots, respectively.
Los Angeles Mayor Karen Bass joined the lawmakers along with leaders of all of the top Hollywood unions, including SAG-AFTRA secretary-treasurer Joely Fisher and WGA West president Meredith Stiehm. Alexandra Pechman and Sarah Adina Smith, co-founders of the grassroots organization Stay in LA, were also on hand.
“We are sounding the alarm as loudly as we can that if we don’t act now, we risk losing our vibrant creative community forever,” Smith said.
Last October, Newsom announced his support for a raise of the cap for the California Film and TV Tax Credit program from $330 million to $750 million, one that would allow the program to expand the types of productions eligible for tax credits and make it the second largest tax credit program in the country behind only Georgia, which has no cap on its program.
Such an expansion, supporters argue, is essential to bring back productions like reality TV and game shows that have moved out of Los Angeles and which are currently not eligible for the California program, which was last updated in 2014 with focus on feature films and prestige dramas, the types of productions that were leaving the state at the time. The pair of new bills, Assembly Bill 1138 and Senate Bill 630, will include language that calls for significant changes to the tax credit program.
“We know that we need to modernize the program,” Zbur said. “It’s about giving a lifeline to small businesses that support the industry and are struggling. With the triple whammy of COVID, luring away of jobs to competitors due to lucrative and more easy access to credits, and now the wildfires…production is starkly down and the numbers prove it.”
“77% of the projects that are unable to secure a tax credit here in the state end up going elsewhere. These are productions that wanted to do the work here,” Allen said. “This has led to a loss of nearly a billion dollars in production spending which leads to lost jobs, lost economic gains.”
Zbur said that stakeholders in Hollywood, including the studios and unions that were on opposite ends of the strike lines two years ago, are set to enter meetings in the weeks ahead to fill in the details on how the tax credit program should be modernized and expanded. He said he was optimistic about the talks because “folks on all sides know we can’t wait to stem the loss of jobs.”
The expansion of the tax credit program will be a major part of the upcoming budgetary process in Sacramento that will largely take place in May and June.
