Lawmaker calls for state audit of LAUSD after fraud lawsuit from former superintendent
A Southern California lawmaker is calling for a state audit of the Los Angeles Unified School District after a lawsuit claims it defrauded taxpayers of millions of dollars in funding.
"I've never called for a state audit for anything else before," Assemblyman Isaac Bryan said. "Many of my colleagues have not either ... It's a major move. It's one that if the state auditor decides to follow through on our request, the district is going to have to produce the necessary documents to show that they are in compliance."
The
district's former superintendent is spearheading the lawsuit.
Austin Beutner and Hollywood's biggest stars helped get nearly a billion dollars set aside specifically for new art teachers and classes, through Proposition 28.
Superintendent Alberto Carvalho said he leaned on the law's intent and used Prop 28 funds to cover existing and new staff. LAUSD said it followed state guidelines and the situation is just a "misunderstanding of the law.
"It is our sincere hope to expedite a resolution to this matter that brings clarity to this matter, continues to protect and expand arts education for our students, and avoids legal costs to our publicly funded institution," the district said in a statement.
More than two years ago, artists and educators across California came together to reverse declining arts education through a new state law. The change would come from Prop 28, which passed overwhelmingly across California, with 70% of LA County in favor of it. Now, there is nearly $1 billion in additional art funding for all schools, with a larger portion promised to underserved communities and a full 80% specifically earmarked to hire new art teachers.
However, after LAUSD got the largest arts funding check in the state, parents began noticing a problem.
"The district wasn't doing what was intended with the money," parent Vicky Martinez said.
Former Superintendent Beutner said the district received $77 million, but none of it went toward hiring new teachers.
Beutner and heads of the LAUSD's largest unions said zero new teachers meant zero real growth in arts education — the very reason he wrote and they backed the law.
"It's a loss of opportunity," SEIU Local 99 Executive Director Max Arias said.
Regarding legal costs, KCAL News asked the district directly about possibly settling the parent lawsuit, but we have not received a response.
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4 days ago
- Yahoo
Timing of California's $750 Million Film Tax Credit Plan in Doubt as State Budget Cuts Weigh Down Process
As a pair of bills to expand California's film tax credit passed their first floor votes in Sacramento this week, confidence is high that the much-touted $750 million benefit will soon be on the way for productions that will keep jobs for entertainment workers in Hollywood. But there isn't a clear answer on what 'soon' means, as the co-authors of the California Film & TV Jobs Act are racing to get their bill past the remaining legislative hurdles and get funding approved. The budget process has been thrown into uncertainty by factors ranging from the Trump Administration's tariffs to Los Angeles wildfire recovery efforts that have left lawmakers unclear on whether the full amount — about double the current tax credit — will be funded. State Assembly members Isaac Bryan and Rick Chavez Zbur, two co-authors of the Jobs Act, told TheWrap on Wednesday they are very confident that the bills that would expand the types of productions eligible for tax incentives and offer a 35% tax rate to Los Angeles-based productions will pass, along with the proposed increase of the program's cap from $330 million to $750 million. 'Our colleagues know we can't let this industry slip,' Bryan said, adding: '$750 million, while it's a lot of money and a desperately needed amount of money to keep the jobs that this industry is producing, is a small fraction of our overall budget.' Language that called for that cap increase was removed from the two Jobs Act bills during budget committee hearings prior to their nearly unanimous floor vote passage this week. But the lawmakers said the language was ultimately unnecessary as the cap increase is still included in Gov. Gavin Newsom's revised budget proposal released last month. Despite Bryan's remark, the local industry has already slipped significantly. Only about 20 percent of US movie and TV production is now made in California, a steep slide over the past 20 years, according to industry studies. FilmLA, which tracks production in Los Angeles, has said that 2024 was the worst year on record for local filming, with the first quarter of 2025 declining another 22% year over year. The state's film commission says that between 2020 and 2024 California lost an estimated $1.6 billion in production spending due to limited tax credit funding. But despite the urgency, apparently nothing in government is easy. Newsom first threw his support behind the cap increase in October and has repeatedly expressed his support for it, including after President Trump knocked Hollywood for a loop last month floating the possibility of levying tariffs against productions shot outside of the U.S. The question is when exactly that money earmarked for the tax incentive program will get final approval in Sacramento and give the California Film Commission the green light to begin the process of implementing the new program. That timetable is unclear because the tax credit legislation, while widely supported, is one of dozens of budget items that Sacramento has to get through, some of which are still the topic of protracted debate. California is in a race against time as other states and overseas locations update their own programs to stay ahead in a global competition for production money. Last week, Louisiana's legislature, months after lowering the cap of its program to $125 million, passed a bill that raised the base tax rate for productions that shoot there to 25%, with an additional 15% credit available towards labor costs if Louisiana residents are hired. Last month, New York raised its program cap to $800 million amidst increased competition for local productions from New Jersey. Bryan explains that the main budget bill that state law requires the legislature to pass and for the governor to approve by June 15 is followed by a period in which the legislature handles 'trailer bills,' which work out the finer details on certain areas of state spending.'The first stab at the budget on the deadline is the bigger, overarching framework of how we're spending the biggest resources to uplift and protect Californians,' Bryan explained, adding that previous changes to the state production tax incentive got final approval through trailer bills passed after that main deadline. The challenge for Bryan, Zbur and other legislators trying to keep Hollywood a major priority is that the trailer bill process is expected to be even more complicated than it usually is, and it's not clear at this time when exactly the trailer bill for the incentive program could come up for a vote. That's because a lot of the guidance that lawmakers have on how much revenue and federal funding it will have for the year has been upended by uncertainty on Wall Street over Trump's tariffs – which affects state capital gains taxes – and suspension of property taxes in parts of Los Angeles affected by January's wildfires, among other factors. Newsom's revised budget projected a $12 billion deficit, leading the governor to call for cuts in a wide range of areas outside of Hollywood, including changes to Medi-Cal that could result in millions of residents, including those who are undocumented, losing coverage. As the larger budget debate plays out over the coming month, the Jobs Act co-authors say they are meeting with legislative leaders, including Assembly Speaker Robert Rivas and Senate President Pro Tem Mike McGuire, to discuss ways to expedite the bills as they head to opposite houses following their first floor votes. If the Jobs Act goes through the usual legislative process of waiting for committee and floor votes, it is likely they would not reach Newsom's desk for signature until the end of the legislative session in September, meaning that the expanded incentive program might not get into full swing until early 2026. While the co-authors haven't settled on a course of action, one option would be to try to make the bills an 'urgency measure,' which would require a two-thirds majority vote to pass but would mean that the bills could take effect immediately once passed rather than on Jan. 1 of the following year. Given that both the Assembly and Senate bills only received one vote against on their first floor votes, the Jobs Act has the support to be enacted faster if this option is taken. 'Bottom line, we are working with the leadership to ensure that the incentive program changes are passed this summer, and come into effect this summer,' Zbur said. The faster Sacramento gives the green light, the better. Once that happens, the California Film Commission still has months of work ironing out how the expanded program will be implemented, including how that $750 million is allocated to different parts of the entertainment industry ranging from feature films to prestige TV dramas and indie productions, as well as new categories like animated projects and half-hour live-action programs that would become eligible with the expansion. For now, the next round of applications for the tax credit program, which opens later this month, will operate under the existing rules and with the current benefit of a 20% tax rate on eligible spending. The post Timing of California's $750 Million Film Tax Credit Plan in Doubt as State Budget Cuts Weigh Down Process appeared first on TheWrap.
Yahoo
11-05-2025
- Yahoo
Show Us The Money: When Can Productions Expect To Reap Benefits Of California's Proposed $750M Film & TV Tax Credit Expansion?
Amid the swirl of the Trump administration's nascent plans to 'Make Hollywood Great Again,' California is on the verge of revamping its Film & TV Tax Credit Program in the hopes of reinvigorating the state's production pipeline. But, it could be more than a year before production workers begin to feel the affects of the proposed changes, if they are approved by the Legislature. After years of strife for the California film and television industry, Gov. Gavin Newsom in October proposed a significant increase to the overall cap on incentives, more than doubling it from $330 million to $750M annually. The sister bills currently making their way through the state Senate and Assembly, SB630 and AB1138 — a hot topic of conversation at this past week's Deadline-hosted SAG-AFTRA event gathering politicians and industry labor leaders — seek to do more than just provide additional finance incentives to studios who bring physical production back to California. More from Deadline Newsom To The Rescue: Governor Supersizes California's Film & TV Tax Credits To Get Hollywood Back To Work CA Film & TV Tax Credit Expansion Bills Clear State Assembly, Senate Committees: 'Motion Picture's Last Hope For California' — Update Sweetened New York Production Incentives A Go As State Budget Passes The bills, sponsored by state Sen. Ben Allen and Assembly members Rick Chavez Zbur and Isaac Bryan, respectively, are also meant to 'amend, update, and modernize' the program. In other words, lawmakers are trying to remove some of the red tape that makes California less accommodating to production than it once was. Deadline understands that the refresh is high on Newsom's priority list, and the prospects for the eventual passage of these bills are positive. So, when can Californians expect to reap the benefits? Since their introductions to both chambers February 20, both bills have successfully made it to the Appropriations committees, where they currently remain. While lawmakers expressed some skepticism early on about the proposed amendments to the program, and whether more than doubling the current incentive cap is the best use of those funds in the state budget, they have passed fairly easily through committee votes thus far. Next up is Newsom's 'May Revision,' when he will release an updated budget proposal that reflects the latest economic forecasts and revenue projections for the year. Sources tell Deadline that the tax-credit funding is expected to survive that revision process, given how much the governor is prioritizing this issue. After the May Revision comes a period of intense negotiations that are likely to result in some changes to the bills as they are currently written as lawmakers work toward agreeing upon a unified budget. If all goes well, additional funding could be available to productions as soon as July 1. There's also a scenario where funds don't come available until January 1. Then, there's a middle option. Option 1: In the best-case scenario, the proposed changes to the program will be signed into law in June along with the new budget. Sources tell us this is the most ideal outcome, since it would mean the rejuvenation of the state's film and television industry can begin sooner rather than later. It's also the most politically and structurally complicated, because it would likely mean attaching the proposed changes to the program in the actual budget bill, which can often cause hiccups with the Legislature. Option 2: It's more likely the funding will remain separate from the proposed amendments to the program, which could lead to two outcomes. First, the budget passes in June and the other structural changes come at a later date. As one source notes that 'everybody feels a sense of urgency' to solve this issue within the state, the goal would be to inject at least some energy into the production pipeline as quickly as possible. Option 3: Newsom waits to sign the funding into effect until the bills get approval from both chambers. Sources predict the bills will be approved sometime between September and January. This is both the least likely and the least desirable outcome. If the bills are signed into law, the California Film Commission will need to go through a regulatory process to develop guidelines for implementation. This process can take between six months to a year. This means that, while the $750M in funding could be earmarked for the Film & TV Tax Credit Program by July 1, it would likely be several more months before that money is distributed. The application window for Program 4.0, which does not include the additional funding or updated provisions, begins in mid-June. For that cohort, the funding cap will remain at $330M, with a 20% base credit for individual productions. Sources don't seem to know what to expect with this version of the program. On one hand, it could entice some of the major studios now that they have the option of up to 90% refundability, meaning they can get cash back if they don't have sufficient state tax liability (which many of the major studios do not). However, with much of Hollywood waiting with bated breath for the new program updates, some sources wonder whether there will be an underwhelming response to the upcoming application process. 'Is anyone going to apply if they wait three months longer and get 35% [credit]?' one source asked. One potential solution is to offer productions the ability to retroactively receive a 35% credit on qualified expenditures, pending approval from the state. However, this comes with obvious risks considering that, as one source familiar with the process notes, 'nothing is guaranteed.' In any case, the application review process can take between 4-5 weeks, putting at least another month on the clock. AB1138 and SB630 would expand the definition of a qualified motion picture, allowing additional projects to apply for the program including series with episodes averaging 20 minutes or more; animated films, series, and shorts; and large-scale competition shows. Additionally, the bills propose increasing the available credit amount for an individual project from 20% to 35% for amounts paid or incurred in Los Angeles, also giving the California Film Commission leeway to allow for additional credit percentages of 5% in other areas of economic opportunity. While there haven't been many objections to the bills' current contents, there has been discussion about what is missing from them. The two glaring omissions are post-production and commercials. Even in the newly proposed bills, California Film & TV Tax Credit Program does not currently allocate specific funds to post-production, a lucrative part of the production pipeline that has been drawn away from the state due to program provisions elsewhere. New York, for example, offers $45M annually specifically to fund post-production. Some parties are also pushing for commercials to be considered eligible projects, as they are in many other territories, for similar reasons. Both are expected to become topics of discussion as the bills make their way to the Senate and Assembly floors, which could potentially slow the approval process. When can California production workers expect any sort of reprieve? The short answer is it depends. The longer answer is that, pending a host of regulatory processes, it could take anywhere from about nine months to more than a year for the proposed changes and expanded funding to take effect — and even longer for projects to actually be accepted into the program. So, while help is certainly on the way, just about the only thing that is absolutely clear is that it won't come overnight. Best of Deadline All The Songs In Netflix's 'Forever': From Tyler The Creator To SZA 2025 TV Series Renewals: Photo Gallery 2025 TV Cancellations: Photo Gallery
Yahoo
22-04-2025
- Yahoo
California Film and TV Tax Credit Expansion Passes First Committee Vote
One of two bills designed to combat the loss of film and television productions in California by expanding the eligibility rules for the state's tax incentive program passed its first committee vote on Tuesday. Assembly Bill 1138, the California Film & Television Jobs Act, was passed by the CA Assembly Committee for Arts, Entertainment, Sports and Tourism and now advances to a hearing by the Assemble Revenue and Tax Committee next week. A hearing for a companion bill, Senate Bill 630, is scheduled for Wednesday. 'California's film and television industry isn't just part of our cultural identity — it's an economic powerhouse that supports hundreds of thousands of good-paying jobs,' said Hollywood Asm. Rick Chavez Zbur, who is a co-author on the bill. 'But without swift action, we risk losing it all. AB 1138 & SB 630 are about making sure California stays competitive, so that workers aren't forced to leave the state — or the industry they love — to make a living. This is a jobs bill, a small business bill, and a bill to keep our creative economy right where it belongs: here in California.' Among the changes proposed by the two bills include reducing the runtime required for a TV show to be eligible for incentives from 40 minutes to 20 minutes. The 40-minute limit was set during the last overhaul of the tax credit program in 2014 to emphasize prestige TV dramas, which were declining in California at the time. But with TV production in Los Angeles County down 30% year-over-year and 58% from its all-time high in 2021, according to FilmLA, a reduction in the runtime requirement would allow sitcoms and other half-hour shows that provide a significant number of production jobs to be eligible for tax credits. The bill also proposes expanding the eligibility list for the credit to include 'animation films, series, shorts and large-scale competition shows' with a minimum budget of $1 million. To further incentivize production in Los Angeles, the bill proposes increasing the tax credit to 35% for any production that shoots within the thirty-mile radius of Beverly and La Cienega Boulevard, as well as other Southern California shooting locations such as Agua Dulce, Pomona and Ontario International Airport. 'Today's committee vote to pass AB 1138 sends a clear message to California's entertainment workers, storytellers, and the thousands of businesses that service this industry in all corners of the state,' said Culver City Asm. Isaac Bryan. 'We see you, we value you, and we will fight for you.' 'California's film and television industry is part of who we are as a state. As productions move elsewhere, we risk losing not just jobs, but a piece of our cultural identity,' said Fullerton Asm. Sharon Quirk-Silva. 'I am proud to support AB 1138 and SB 630, and I thank Assemblymember Zbur and Senator Allen for their leadership in keeping California the heart of the entertainment world. This bill helps ensure that the workers and families who power this industry can continue to thrive right here at home.' The post California Film and TV Tax Credit Expansion Passes First Committee Vote appeared first on TheWrap.
