Gov. Mitt Romney (R-Mass.) has signed a bill into law that provides tax incentives for feature, TV and spot production in Massachusetts. The new measure is scheduled to take effect in late February, 90 days after it received Romney’s signature. However, the provisions will be retroactive to January 1, 2006.
The principal elements of the incentives package include: a 20 percent wage tax credit on a filming project’s source payroll in Massachusetts; a 25 percent tax credit for qualifying Massachusetts production expenses (excluding payroll); and a sales tax exemption on Massachusetts production costs.
To qualify for the 20 percent tax credit and the sales tax exemption, a producer has to incur at least $250,000 in Massachusetts-based production costs in a year. To be eligible for the aforementioned 25 percent tax credit, more than half of the total production must take place in Massachusetts or more than half of the total production costs need to be spent in the state.
The total credits available for any single production are capped at $7 million. And there’s no appropriations cap on the bill, meaning that funding for the anti-runaway provisions will cover the entire year.
Steve Caplan, senior VP of the Association of Independent Commercial Producers (AICP), described the legislation as “ambitious and far reaching….We’re encouraged and pleased to see these incentives enacted–and that they apply to commercials.”
Caplan added that the bill also waives fees on state-owned properties, with producers only having to reimburse any actual costs incurred by the state in the use of those sites for the lensing of a project.
MPC
Much of the credit for bringing this legislation to fruition goes to the Massachusetts Production Coalition (MPC), an alliance of production professionals and related groups in the state that are actively engaged in content creation for all media. The mission of the volunteer-driven coalition is to help maintain, promote, increase and expedite the development, creation and production of film, video and new media content in the city of Boston and throughout the state of Massachusetts.
MPC representatives played a key role in lobbying for production incentives, garnering bipartisan support for the anti-runaway measure in both houses of the state legislature. Next on the MPC agenda is to bring about the formation of a state sanctioned film commission under the Massachusetts Executive Office of Economic Development. A full-fledged state film office is needed to help facilitate and administer the new incentives.
“During our efforts to get the legislation passed in the past year, the MPC brought together many important industry stakeholders from both inside and outside of the state, from Massachusetts-based film and video companies to Hollywood studios,” stated MPC president Joe Maiella. “In addition, our coalition represents the interests of the entire production community. For these reasons, the MPC is in a unique position to provide the state valuable assistance in the creation of a vibrant and effective film office.”
Chris O’Donnell, IATSE Local 481 business manager and MPC legislative committee chairman, added, “This new law is going to open the floodgates for production in Massachusetts, and we have to become very effective in channeling this new business into our community. The MPC’s sole agenda is to facilitate production in the commonwealth–and we look forward to working with the Office of Economic Development to make this the mission of the new film office as well.”
Some speculate that the passage of the Massachusetts incentive package may spur on movement for similar reform in nearby New York. As earlier reported (SHOOT, 12/2, p. 1), momentum is building for legislation that would create a New York State tax credit targeting commercials. The bill’s backers hope to have it voted on by the legislature during its next session, which begins in January. The New York proposal is believed to be the first of its kind specifically geared to commercials.