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Economic Times
3 days ago
- Business
- Economic Times
California Film Credit expansion claims to bring back jobs; effect remains uncertain
iStock California Film Credit expansion California legislators are moving to greatly expand the state's Film and Television Tax Credit Program as a means of stopping the flow of runawaproduction and revitalizing a struggling entertainment industry. The expansion, if approved, would double the program's annual limit from $330 million to $750 million. But, even with the broad changes, analysts and industry officials warn that the effect on employment might not be as dramatic as anticipated. As reported by the California Film Commission, the expansion would increase direct employment by 40–50%, or approximately 4,400 to 5,500 new cast and crew jobs. However, this is only a small portion of the 17,000 jobs that have been lost since 2022, according to figures presented by the Motion Picture Industry Pension and Health Plan. The Bureau of Labor Statistics further reports that California experienced a decline of approximately 40,000 jobs within the industry since before the pandemic, with some entertainment unions having claimed that as much as half of their members have been laid off. Assemblyman Rick Chavez Zbur, chief sponsor of the expansion, recognized the limitations: 'This is not a panacea. It will not reverse the steep slide in jobs, but it will bring some of the jobs back.' He pointed out that increasing the payout might attract more high-budget films to film in California instead of abroad, although the state's incentive is still smaller per job than those from New York and Georgia. Economic studies provide conflicting views. A recent study for the Milken Institute indicated the expansion could create an additional 14,886 jobs accounting for ripple effects on the economy. The California Legislative Analyst's Office has challenged such assertions, however, to say there is "no compelling evidence" film tax credits significantly improve the overall state economy and that incentives instead could simply displace other economic activity. Industry supporters, such as Local 724's Alex Aguilar and Rebecca Rhine of the Directors Guild of America, recognize that any forward movement is necessary. Rhine commented, 'While more resources would lead to more jobs, we recognize the challenges of the current moment and competing priorities. Action is necessary now, and we cannot allow the perfect to be the enemy of the good.'The California Film and Television Tax Credit Program is a state incentive program that provides film and television production companies with tax credits they can use to offset part of their qualified costs in order to incentivize them to film their productions in California. The overall objective of this program is to assist in the creation and retention of jobs within the entertainment sector in the employments of Californians that benefit not just the actors and directors but also the large network of crew, technicians, and local businesses dependent upon film and television the plan, eligible productions—feature films, TV series, miniseries, and pilots—can qualify to get tax credits normally between 20% and 25% of their qualified expenditures, based on the type of project and whether produced by an independent or non-independent credits cut into the tax obligation of the production companies directly, so it is more desirable for them to shoot in California than elsewhere in other states or nations that provide similar program is specifically designed to generate the highest employment. For example, productions have to spend a minimum of 75% of their production budget or principal photography days in California in order to qualify, so that lots of money is spent locally and employment is generated for the people of California.
Time of India
3 days ago
- Business
- Time of India
California Film Credit expansion claims to bring back jobs; effect remains uncertain
California legislators are moving to greatly expand the state's Film and Television Tax Credit Program as a means of stopping the flow of runawaproduction and revitalizing a struggling entertainment industry. The expansion, if approved, would double the program's annual limit from $330 million to $750 million. But, even with the broad changes, analysts and industry officials warn that the effect on employment might not be as dramatic as anticipated. As reported by the California Film Commission , the expansion would increase direct employment by 40–50%, or approximately 4,400 to 5,500 new cast and crew jobs. However, this is only a small portion of the 17,000 jobs that have been lost since 2022, according to figures presented by the Motion Picture Industry Pension and Health Plan. The Bureau of Labor Statistics further reports that California experienced a decline of approximately 40,000 jobs within the industry since before the pandemic, with some entertainment unions having claimed that as much as half of their members have been laid off. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Massive Refunds Rolling Out from Close Brothers - Lookup Your Name Get Offer Undo Assemblyman Rick Chavez Zbur, chief sponsor of the expansion, recognized the limitations: 'This is not a panacea. It will not reverse the steep slide in jobs, but it will bring some of the jobs back.' He pointed out that increasing the payout might attract more high-budget films to film in California instead of abroad, although the state's incentive is still smaller per job than those from New York and Georgia. Economic studies provide conflicting views. A recent study for the Milken Institute indicated the expansion could create an additional 14,886 jobs accounting for ripple effects on the economy. The California Legislative Analyst's Office has challenged such assertions, however, to say there is "no compelling evidence" film tax credits significantly improve the overall state economy and that incentives instead could simply displace other economic activity. Live Events Industry supporters, such as Local 724's Alex Aguilar and Rebecca Rhine of the Directors Guild of America , recognize that any forward movement is necessary. Rhine commented, 'While more resources would lead to more jobs, we recognize the challenges of the current moment and competing priorities. Action is necessary now, and we cannot allow the perfect to be the enemy of the good.' What is California's Film and Television Tax Credit Program? The California Film and Television Tax Credit Program is a state incentive program that provides film and television production companies with tax credits they can use to offset part of their qualified costs in order to incentivize them to film their productions in California. The overall objective of this program is to assist in the creation and retention of jobs within the entertainment sector in the employments of Californians that benefit not just the actors and directors but also the large network of crew, technicians, and local businesses dependent upon film and television production. Under the plan, eligible productions—feature films, TV series, miniseries, and pilots—can qualify to get tax credits normally between 20% and 25% of their qualified expenditures, based on the type of project and whether produced by an independent or non-independent firm. These credits cut into the tax obligation of the production companies directly, so it is more desirable for them to shoot in California than elsewhere in other states or nations that provide similar incentives. The program is specifically designed to generate the highest employment. For example, productions have to spend a minimum of 75% of their production budget or principal photography days in California in order to qualify, so that lots of money is spent locally and employment is generated for the people of California.
Yahoo
4 days ago
- Business
- Yahoo
California Senate Approves Film & TV Tax Credits Bill
In a near-unanimous vote, the California Senate today passed its version of legislation aimed at expanding and retooling the state's Film and Television Tax Credit Program. The vote on Senate Bill 630 was 34-1, with the only nay coming from Sen. Roger Niello, who represents the city of Sacramento and surrounding areas. The bill (read it here) now moves on to the state Assembly. More from Deadline Show Us The Money: When Can Productions Expect To Reap Benefits Of California's Proposed $750M Film & TV Tax Credit Expansion? SAG-AFTRA's 'Here's Looking At You L.A.' & Mayor Karen Bass Push For State & Federal Tax Incentives To Get Hollywood Working Again Sweetened New York Production Incentives A Go As State Budget Passes Along with Assembly Bill 1138 — which passed the Appropriations Committee last month — the legislation 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, animation films, series, and shorts, and large-scale competition shows. 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. SB630 and AB1138 seek to do more than just provide additional finance incentives to studios who bring physical production back to California. The sister bills also are meant to 'amend, update, and modernize' the program. The legislation comes amid the latest spurt of runaway production as other states ramp up their film and TV tax incentives programs in an effort to lure production away from California. New York last month passed a state budget that includes expanded incentives. RELATED: Also getting Hollywood's attention is President Donald Trump's bombshell announcement of planned tariffs on movies produced outside the U.S., which were decried many in the industry, along with Newsom, who said Trump has 'no authority' to impose the tariffs. Here is how the voting on SB630 went: Best of Deadline 2025-26 Awards Season Calendar: Dates For Tonys, Emmys, Oscars & More Everything We Know About 'Nobody Wants This' Season 2 So Far List Of Hollywood & Media Layoffs From Paramount To Warner Bros Discovery To CNN & More
Yahoo
06-05-2025
- Business
- Yahoo
Newsom asks Trump to work together on $7.5 billion Hollywood tax credit
California Gov. Gavin Newsom (D) is offering to partner with the Trump administration to create a federal film tax credit program worth at least $7.5 billion to boost domestic film production, his office said late Monday. The proposal came after President Donald Trump set Hollywood on edge by calling for massive tariffs on foreign-made films to address what he described as the 'DYING' American film industry. If the proposal comes together, it would be the largest government tax initiative for the film industry in U.S. history and the first such program at the federal level, a spokesperson for Newsom's office said. Subscribe to The Post Most newsletter for the most important and interesting stories from The Washington Post. 'America continues to be a film powerhouse, and California is all in to bring more production here,' Newsom said in a statement. He added that California is 'eager to partner with the Trump administration to further strengthen domestic production and Make America Film Again.' The White House did not immediately respond to a request for comment. Newsom, a fierce Trump opponent, is making the request at a time when tariffs have upended the global economy and sowed uncertainty across many industries. Newsom sued the Trump administration last month to block the president's sweeping tariffs, arguing they are causing irreparable harm to California's economy. Trump's call Sunday night for 100 percent tariffs on films produced overseas, in which he described foreign films as a national security threat, puzzled insiders in the highly globalized industry as to its implications. It was not clear how such tariffs would be applied or how they might affect U.S. films shot overseas or involving production abroad, The Post reported. Andrew deWaard, an assistant professor at the University of California at San Diego who studies the relationship between culture and commerce in the film industry, said the program proposed by Newsom on Monday is 'highly unlikely' to go into effect. 'I can't imagine in such a partisan atmosphere that Trump would want to be seen subsidizing California entertainment workers just as the tariffs are starting to negatively affect U.S. factory workers, farmers, truckers, etc.,' he said in an email. 'I think Newsom is calling Trump's bluff,' he added. '… If Trump balks, which is likely, then Newsom can say he tried to be bipartisan.' Newsom's office described the proposed federal tax credit as a way to bolster American stories, create U.S. jobs and benefit the industry's behind-the-scenes workers such as set builders and electricians. The proposal would be modeled after California's Film and Television Tax Credit Program that Newsom's office said has generated more than $26 billion in economic activity and supported thousands of jobs across the state since its inception in 2009. But there is debate over the effectiveness of such film tax credits. In testimony to the state's Senate Revenue and Taxation Committee this year, Michael Thom, a professor at the University of Southern California who has researched tax incentives for film and television production, said such initiatives 'fail to stimulate enough economic activity to justify their substantial cost.' --- Video Embed Code Video: President Donald Trump said on May 4 that he wants tariffs on all foreign-made movies, saying other countries have "stolen" the American film to The Washington Post Embed code: Related Content At a Kentucky farm, star racehorses help people fight a monster: Addiction
Yahoo
22-04-2025
- Automotive
- Yahoo
Los Angeles sees continuing decline in film and television production
Los Angeles has seen a decline in local film and TV production, causing some to worry the city could face the same fate as Detroit did with the auto industry several decades ago. "As the auto industry left Detroit, it really hollowed out that city, and now there's some concern that the same thing could be happening here in Los Angeles and in Hollywood as movie productions move out of town," FOX Business correspondent Max Gorden reported Tuesday. In a report released last week, FilmLA said the greater Los Angeles area's on-location production for movies, TV, commercials and other projects amounted to just shy of 5,300 shoot days in the first quarter of the year, marking a 22.4% drop from the same three-month period in 2024. That came amid a "global decline in production and intensifying competition for film projects and jobs" from other places, the not-for-profit organization said. Los Angeles faced massive wildfires in January but, according to FilmLA, they had a "small effect on L.A. area filming" during the quarter. On-location production in Los Angeles during 2025's first quarter was also lower than that seen in the first quarter of 2021, when the local industry notched over 7,000 shoot days, Gorden reported, citing FilmLA data. Read On The Fox Business App The head of a Los Angeles location agency told Gorden that small companies were having trouble. "A lot of the smaller companies I know are unfortunately struggling to the point where they're having to call it a day in this industry, and especially for the people that work here, I've hired countless people over the years, and it's getting harder and harder for below-the-line crew to find work," Real to Reel Location Agency CEO Gary Onyshko said. Industry experts want fewer regulations and more incentives from the California government to encourage productions to return and film in the Golden State, according to Gorden. Mel Gibson Embraces Las Vegas Movie Production As Hollywood Struggles "People feel like, 'Well, why does Hollywood need handouts from the government? Like they're rich, they're all a bunch of rich people.' It's like, that's not true at all," location scout Dale Dreher told Gorden. "This is my backyard. I live in South LA. I've lived here for 21 years, and I'm worried about my next house payment just like anybody else." In late October, Gov. Gavin Newsom proposed upping California's Film and Television Tax Credit Program to $750 million per year, representing a $420 million increase from the $330 million currently allocated. His office said at the time that it would "allow California to outpace other states offering tax credits, luring more entertainment industry projects back to the Golden State." More recently, in February, state lawmakers introduced legislation to revamp California's Film and Television Tax Credit Program. On top of raising the overall program amount to $750 million, the bills would make more productions eligible for tax credits and up the size of the tax credits each project could receive, among other things, according to a press release. The entertainment industry in Los Angeles "brings over $30 billion to California and supports over 200,000 local jobs," according to the City of Los Angeles' Economic And Workforce Development Department. It is also a major driver of tourism for the city. Click Here To Read More On Fox BusinessOriginal article source: Los Angeles sees continuing decline in film and television production
