California Film and TV Tax Credit Program Gets a Boost
California lawmakers have approved changes to the state’s film and television tax credit program.
This week, the Senate gave its approval, and Governor Gavin Newsom signed the law. The recent bill aims to “modernize” the program while expanding eligibility, complemented by a newly allocated $750 million in incentive funding.
Beyond widening eligibility, the bill suggests increasing the available credit for individual projects from 20% to 35% for expenses incurred in Los Angeles. Additionally, the California Film Commission will have the flexibility to offer an extra 5% credit in other economically viable areas.
AB1138 will also raise the maximum production incentive cap to $120 million and tripling funds for independent films from $26 million to $75 million. The primary objective of this initiative is to generate jobs in the production sector, with a focus on enhancing access to career opportunities through non-profit collaborations.
Proposed amendments and funding increases discussed in July showcase an optimistic outlook for these updates to the California Film & TV Tax Credit Program. Thursday’s announcement brought elation from organizations like the Entertainment Union Coalition and the California Production Coalition, who fought diligently for the bill’s passage.
“This important program enhancement, aligned with last week’s funding expansion, will boost California’s competitiveness and pave the way for new projects throughout the state,” said the California Production Coalition in a statement. “We appreciate Sacramento’s elected officials for supporting the vendors, businesses, and families connected to this iconic industry.”
The EUC emphasized the significance of advocacy efforts, stating, “Through united actions and the Continue Rolling California Campaign, we have championed programs that support work, family, and business. Now we eagerly anticipate returning to work in our communities. We urge studios to make this a reality.”
A grassroots collective named Stayinla, spurred by the severe Los Angeles fires in January, also rejoiced in the passing of AB1138. The organization has been rallying Hollywood’s leading producers, actors, writers, and directors to revitalize physical productions in the city.
“Stayinla is excited about California’s renewed dedication to safeguarding our creative economy,” co-founder Pamala Buzick Kim stated in a release. “This goes beyond policy; it’s a crucial support for families, small businesses, and communities in Los Angeles still recovering from the catastrophic wildfires.”
“This achievement reflects the power of collective effort,” co-founder Alexandra Pechman added. “From the original petition signed by over 23,000 Angelenos advocating for post-wildfire incentives, to viral letter campaigns in Sacramento and in-person testimonies, our Stayinla community has unified to drive this vital change home.”
The hope is that physical production will start to flourish in the state, attracting new projects to film in California and encouraging past projects to return. At a press conference on Wednesday, Newsom highlighted that Prime Video’s Mr and Mrs. Smith will film its second season in Los Angeles County, alongside Fallout, two major titles recently moving from New York to California.
Earlier this month, the California Film Commission awarded over $96 million in tax incentives to more than 40 films. This seems to reflect the industry’s evolving financial landscape, with 43 out of 48 of these projects being independent films, many with budgets below $10 million.
