Film Tax Credit Legislation Passes Key Fiscal Committee
SACRAMENTO – Legislation to extend California’s successful Film and Television Tax Credit Program passed out of its second committee yesterday. The bill, AB 1734, jointly authored by Assemblymembers Richard Bloom (D-Santa Monica), Rob Bonta (D-Alameda), Ian Calderon (D-Whittier) and Lorena Gonzalez-Fletcher (D-San Diego), extends and enhances the program, which has been one of the most effective economic development tools in the state.
“California’s film industry is a hallmark of our great state and an economic powerhouse that generates billions of dollars in wages and direct spending every year,” said Assemblymember Richard Bloom, a co-author of the bill that updated the program in 2014. “AB 1734 will fortify this great industry and protect and expand tens of thousands of middle class jobs.”
For most of the past century, California, and particularly the Los Angeles region, has been the undisputed world capital of the entertainment industry. That title, however, has been threatened by the financial incentives offered by other states and countries. Prior to the Legislature’s overhaul of the California Film and Television Tax Credit Program in 2014, feature film production declined by 30 percent and 1-hour basic cable production market share dropped by 48 percent. The precipitous drop in film and television production coincided with aggressive, predatory practices by states such as Louisiana, Georgia and New York and countries such as Canada and Britain. Since California’s film and television industry peaked in the late 1990s, it has lost 90,000 middle class jobs, $3 billion in wages, and impacted many local small businesses that rely on a healthy local entertainment industry.
Recognizing the economic impact that this changing landscape was having on California’s economy, the Legislature passed AB 1839 in 2014 to overhaul the state’s existing Film and Television Tax Credit Program. That bill more than tripled the size of the existing program from $100 million to $330 million, allowed larger feature films to receive credits, increased incentives for television shows, allowed films produced outside of the existing entertainment zone to qualify, and allowed credits for music scoring and editing.
AB 1734 continues the $330 million in available tax credits, extends the tax credit program until 2025, expands the scope of productions, and updates program requirements to ensure wider program applicability to keep pace with the changing industry landscape. The structural changes to the program proposed by the bill will also allow the program to compete with similar programs in other states and countries. Recent amendments to the bill also require an applicant for the credit to include, in the application, the applicant’s written policy against unlawful harassment.
The bill now heads to the Assembly Appropriations Committee.
Richard Bloom represents California’s 50th Assembly District, which comprises the communities of Agoura Hills, Bel Air, Beverly Hills, Brentwood, Hollywood, Malibu, Pacific Palisades, Santa Monica, Topanga, West Hollywood, and West Los Angeles.