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Thursday, Jun 1, 2023

Report: Beef Up Production Incentives

A new report issued Thursday on runaway film and television production in California recommends the state increase the amount of its tax incentive program, allow big budget features to apply for the tax breaks and expand the program to include visual effects costs. The 42-page report from the Milken Institute, a Santa Monica think tank, concluded that California should not try to keep pace with states offering better filing incentive packages, as it’s a game the state “can’t win.” “Instead, the state must facilitate the preservation of the core employment base and production infrastructure, as well as help local filmmakers restructure and adapt to the new age of digital production and distribution,” the report said. The state’s production tax credit program began in 2009 as a response to television and feature films leaving California for other states and taking associated production jobs. The program is administered by the California Film Commission and funded for $100 million a year through the 2016-2017 fiscal year. On-location film feature film production is down 50 percent from its peak in 1996, and overall on-location television production is down from its peak in 2007, according to data from FilmL.A., the nonprofit coordinating filming permitting in the city and county of Los Angeles and other jurisdictions. FilmL.A.’s numbers do not reflect studio and soundstage filming activity. A bill pending in the state Assembly would make changes to the incentive program, including lifting the $75 million budget cap for film’s applying for the incentives. Lifting the cap and making the breaks available to films of all budget sizes, was a recommendation in the Milken report. “This will encourage productions to shift a significant portion of high-value filming to California,” the report said. Other recommendations include raising the total amount of incentives above the current $100 million limit; starting a 20-percent break for digital visual effects and animation expenditures; and discontinuing incentives for television shows relocating to California in favor of incentives for new shows; The report also suggested increasing to 25 percent the incentive for filming outside the 30-mile zone in the Los Angeles area. The zone is used by union film projects to determine per diem rates and driving distances for crew members. “This will stimulate productions in formerly busy locations such as San Francisco and encourage scouting of diverse locales throughout the entire state,” the report said.

Mark Madler
Mark Madler
Mark R. Madler covers aviation & aerospace, manufacturing, technology, automotive & transportation, media & entertainment and the Antelope Valley. He joined the company in February 2006. Madler previously worked as a reporter for the Burbank Leader. Before that, he was a reporter for the City News Bureau of Chicago and several daily newspapers in the suburban Chicago area. He has a bachelor’s of science degree in journalism from the University of Illinois, Urbana-Champaign.

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