Proposed legislation aimed at providing more tax credits to attract so-called runaway movie and television productions back to the industry's birthplace in California won initial approval from a legislative committee Tuesday.
The proposal would renew and increase a state tax credit — amounting to as much as $400 million a year — to better compete with generous tax subsidies available in more than 40 states, including New York, Louisiana, New York and Michigan, as well as studios in Canada and Britain.
The tax credit would allow most film and TV production companies to reduce their tax liability by 20% of the cost of many production expenditures. ...
The hearing for the bill (AB 1839) was held in a small meeting room in the state capitol. The place was packed. Representatives from more than a dozen IA locals, the DGA, SAG-AFTRA, caterers, trucking firms, and several other small businesses spoke in favor of the bill. I got up and mentioned that VFX is in serious, serious trouble in California. And how Industrial Light and Magic, a long-time pillar of visual effects in the bay area, is setting up satellite studios in Canada and London.
Bruce Doering, the Executive Director of the Cinematographers Guild, said the industry is at a tipping point, that production infrastructure is starting to unravel and if it goes away to places like New York, Louisiana and Georgia (all states with big tax incentives) it will be tough to get the work back.
At the membership meeting tonight, we collected a bunch of signatures on letters urging the California legislature to pass the enhanced bill. It's not a perfect solution, and it needs more explicit language about animation and visual effects embedded in it, but the law, if passed, will be a big improvement over the legislation that's in place now. Over the next few days, we'll be sending out e-mails and letter asking people to write the California Assembly and Senate about the new tax incentives.
More coverage of the hearings can be found here and here.