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.
Thanks in part to lobbying efforts by the Association of Independent Commercial Producers (AICP) over the past year, the idea of a spot production incentive initiative has gained significant bipartisan support in both the New York Assembly and Senate. Firmly in place as bill sponsors are Assemblyman Joseph Morelle (D-Rochester) and Sen. Martin Golden (R-Brooklyn)
A key objective for the bill’s proponents is to bring Gov. George Pataki (R-N.Y.) on board so that the legislation’s cost is incorporated into the upcoming proposed state budget currently being worked on by the governor’s office.
The anti-runaway production bill–believed to be the first of its kind specifically geared to commercials–will be subject to the give-and-take jockeying that goes on during the legislative budget process. Thus its specific provisions are yet to be determined. In some circles, general terms have been bandied about that include a 10 percent tax credit on certain below-the-line expenditures for companies with production costs of more than $500,000 annually in New York. Whatever the final details, suffice it to say that if passed, the tax credit would figure to have a substantive, positive impact. Matt Miller, president/CEO of the Association of Independent Commercial Producers (AICP), said that the tax credit could cause many producers to view a significantly greater number of jobs as being economically viable to shoot in New York–projects that previously wouldn’t have been regarded as such.
The tax credit for spot production is designed to parallel the program that has helped to spur on feature and TV production in New York. That Empire State Production Tax Credit program provides a 10 percent tax credit on below-the-line production costs for certain qualifying projects (feature films, TV movies, TV pilots and series episodes) shot in New York State. New York City then followed with its own five percent refundable tax credit to work in tandem with the state initiative.
When commercials were excluded from the feature/TV legislation that passed last year (SHOOT, 9/17/04, p. 1), it was a disappointment for the spotmaking community. In response to the ad business being given short shrift, the AICP immediately set out to rectify the situation, hiring a major national lobbying firm, Wilson, Elser, Moscowitz, Edelman & Dicker. The firm helped open some doors in Albany, enabling the AICP to present its case to legislators regarding the importance of commercialmaking to the New York economy.
New York has experienced major growth in feature and TV program production this year, attributable largely to the enacted tax credit. Meanwhile, by sharp contrast, TV spot filming is waning in New York. For example, per the independently conducted third annual survey of AICP member companies, Los Angeles’ share of spot shoot days in the U.S. rose from 46 percent in 2003 to 53 percent in ’04. However, New York showed a decrease from 21 to 18 percent during that same time frame (SHOOT, 10/21, p. 40). AICP president/CEO Matt Miller said that this decline underscores the need for New York to implement incentives in order to stimulate commercialmaking.