At press time, Rep. Jerry Weller (R-Ill.) was scheduled to introduce a bill in Congress this week that calls for providing postproduction facilities with an investment tax credit. The credit would help make the Federal Communications Commission (FCC)-mandated transition to DTV, including HDTV, more economically feasible for the post community. Weller is a co-sponsor of the proposed measure, which is backed by the Association of Imaging Technology and Sound (ITS).
Though Congress is set to adjourn shortly and the prospects for the bill’s passage in this session are iffy, Weller’s decision to formally put the bill on the U.S. House of Representatives’ docket was enthusiastically received by the ITS. At press time, the measure had 15 co-sponsors. That, coupled with its pending introduction in Congress, at the very least lays a strong foundation for the reintroduction of a progressive tax credit proposal in the next congressional session, with improved prospects for passage, according to ITS president Terry Rainey.
And there’s always the chance that the current bill could be attached to a larger piece of legislation with long coattails, perhaps helping the tax credit measure to pass both the Senate and House of Representatives before being sent to President Clinton’s desk for signature.
As earlier reported, the ITS organized a grass-roots campaign in support of the tax credit bill, urging its members to contact their local elected representatives via phone, letter, fax and/or e-mail. This effort helped to line up key co-sponsors in the House of Representatives. Added to the core co-sponsor group of Weller, Rep. Xavier Becerra (D-Calif.), Rep. Mark Foley (R-Fla.) and Rep. Robert Matsui (D-Calf.) were: Rep. Howard Berman (D-Calif.), Rep. Gary Condit (D-Calif.), Rep. William J. Coyne (D-Penn.), Rep. Phil English (R-Penn.), Rep. Stephanie Tubbs Jones (D-Oh.), Rep. John Lewis (D-Ga.), Rep. Carolyn B. Maloney (D-N.Y.), Rep. Jim Ramstad (R-Minn), Rep. James Rogan (R-Calif.), Rep. James Sensenbrenner (R-Wis.) and Rep. Pete Sessions (R-Tx).
ITS government affairs manager Tracy Murley noted that efforts are ongoing to bring additional co-sponsors into the fold. The current roster of co-sponsors has some extra clout, in that eight are members of the influential House Ways & Means Committee: Becerra, Coyne, English, Foley, Lewis, Matsui, Ramstad and Weller. "It’s a mix [of legislators] that underscores the fact that our bill has solid bipartisan support," added Rainey.
The proposed R&D tax credit would be computed at 20 percent of a domestic post company’s current capital expenses incurred for digital post machinery and equipment, less a dollar amount equal to the facility’s average annual gross receipts from DTV post services during the prior four years. The intent is to encourage the domestic construction of an advanced digital post infrastructure when the current demand for such services may not justify the required expense. The measure is structured to effectively increase the threshold for tax credit qualification as the revenue generated by digital television post services grows.
Digital postproduction equipment would be defined in the context of the Advanced Television Systems Committee standards, which have been adopted by the FCC for digital TV. Among those qualifying for the proposed R&D tax credit would be digital video and audio post facilities, animation houses and post equipment rental companies.
