Incentives Watch: Several States Now See the Results of Film Credit Legislation from Prior Years

The last two years saw a lot of shakeup in the film credit landscape, with major movie-producing states like California, New York and Louisiana revamping their credits. The changes came with a lot of speculation over what would happen to the film industry, but since Nate Silver didn’t turn his attention to tax credits, no one could know for sure. Now, we are starting to see the ramifications of the legislative changes from the past couple years.

In 2015, when Louisiana placed a $180 million cap on their previously uncapped film credit program, many thought it would be the death knell of the film industry in Louisiana. However, it looks like there is still a lot of demand for filming in Louisiana as the credit cap was reached this year in about four weeks, according to The Advocate.

In 2014, California increased its film credit to $330 million a year. The previous film credit in California was not available to productions with a budget greater than $75 million. However, hoping to lure larger budget films to the state, California now awards tax credits to films with any budget, but only for the first $100 million of expenses. And it worked for at least one film, bringing the adaptation of the novel “A Wrinkle in Time” to California, as reported by David McAfee in the Weekly State Tax Report. The film, which will star Oprah Winfrey, has a budget of over $100 million and has been awarded a little over $18 million in film credits for Disney, who is producing the film.

New York provides a 30 percent film credit, but in 2013, added a 10 percent bonus on wages paid for services performed in certain upstate counties. A proposed bill, S.B. 6987, would add another 12 counties to the list of places that would be eligible for the bonus credit. So far, the credit has driven some film production business to the counties that are already eligible for the incentive. According to the sponsor memo for the legislation, “[t]his incentive has worked. Production companies are now filming in upstate New York” thanks in part to the tax credit. The bill's sponsors hope that the legislation, if passed, will bring film production to the 12 new counties.

With several states seeing a positive impact from their legislative changes to film credits, you would think that letting a tax credit expire would force productions to leave the state. Indeed, after Florida failed to extend their film credit which sunset at the end of July, many film industry professionals left Florida for Georgia, reported The Dayton Beach News-Journal. Curiously, however, two prominent TV shows that film in Florida, HBO’s Ballers and Netflix’s Bloodline, renewed their shows for another season, despite the lack of credits, according to Screen Crush. While Bloodline will continue to film in Florida, Ballers has not yet announced a filming location for Season 3, though producing the show in another state “would require a lot of adjustments,” according to The Capitolist.

It doesn’t take a crystal ball to see that, with or without tax credits, films will continue to be made. But in the ever-changing world of film credits, states will still try to find the right mix of incentives to bring business to the state.

Continue the discussion on LinkedIn:  What is the best way for a state to attract film productions?

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