The effectiveness of California’s Film & TV Tax Credit Program 2.0 in retaining and attracting in-state production is affirmed in an annual progress report released today (11/2) by the California Film Commission.
The report provides comprehensive data through year-three of the expanded tax credit program launched in 2015. It reveals that Program 2.0 has led to sustained growth in:
- Employment–in terms of hours worked in-state by below-the-line crew members. Program year-three continued the long-term growth trend with a 15.6 percent increase in hours worked in 2017 compared to 2014 (the year before Program 2.0 began). This growth builds on 2016’s 12 percent increase over 2014. These figures are based on data for below-the-line workers including Teamsters, IATSE members, basic crafts and others covered under the Motion Picture Industry Pension & Health Plans. In addition, Los Angeles-area sound stages are operating at near capacity (as reported by FilmL.A.), which is leading to substantial growth in construction for new stages and production support facilities.
- Big-Budget Films (over $75 million)–which are a target for the uncapped incentives offered by other states and countries. During year-three of Program 2.0, California attracted five additional big-budget films (“Call of the Wild,” “Captain Marvel,” “Ford v. Ferrari,” “Island Plaza” and “Once Upon a Time in Hollywood”). To date, the expanded tax credit has attracted a total of 10 big-budget films.
- Relocating TV Series–which have their own dedicated allocation of tax credits. During year-three of Program 2.0, California attracted two additional relocating TV series (NBC’s “Timeless” from Vancouver, and Amazon Studios’ “Sneaky Pete” from New York). To date, the expanded tax credit program has gained a total of 15 relocating TV series from across the U.S. and Canada.
- Production Activity Statewide–for which Program 2.0 provides an added incentive uplift. During the program’s first three fiscal years, tax credit projects spent a total of more than $78 million in 19 counties outside the Los Angeles 30-Mile Zone. This figure will continue to rise as more tax credit projects for year-three (and prior years) report their out-of-zone spending.
“Today’s report shows that Program 2.0 is working over the long-term to create high-quality production jobs and increase production spending in California,” said Amy Lemisch, executive director of the California Film Commission. “While our tax credit is far more targeted than most, it does precisely what it was designed to do by keeping us competitive and reminding the industry that California has everything needed to provide the best value.”
In total, $815 million in tax credits have been allocated by the state during the first three fiscal years of Program 2.0. This investment is on track to generate nearly $6 billion in direct in-state spending (up from $3.7 billion in spending through fiscal year-two). The latest $6 billion figure includes $2.25 billion in qualified wages and $1.89 in qualified vendor expenditures, along with $1.85 billion in other expenditures that do not qualify for tax credits. Collectively, productions that have been allocated tax credits under Program 2.0 are on track to employ more than 18,000 cast and 29,000 crew members.
Year-four of Program 2.0 began July 1, 2018 (the start of the state’s new fiscal year). The most recent tax credit application period was held October 15-19 for feature film projects. Those film projects approved conditionally for tax credits will be announced on November 19. The next application period for TV projects will be held November 5 – 9, 2018.
