Governor Brown Signs Bill to Extend California Film Tax Credit Program

Wednesday, June 27, 2018

Sacramento, California – Today, Governor Brown signed Senate Bill 871 into law, a measure that extends and enhances the California Film and Television Tax Credit Program.

“I thank Governor Brown for signing SB 871, which extends the California Film and Television Tax Credit Program through July 1, 2025,” stated Majority Leader Calderon. “I am proud to have worked on this issue this year to ensure that the program is not only extended, but improved upon. This year’s version promotes diversity in the industry, provides more opportunities for underserved communities, and aims to strengthen sexual harassment policies. By extending the program, we will continue to restore our state’s competitive advantage for film and TV production, thus ensuring that this vibrant, foundational industry remains part of California’s legacy.”

In an effort to restore California’s competitive advantage for film and television production and bring jobs home, the Legislature passed the California Film and Television Tax Credit Program in 2009.  Building on the successes of that program, the Legislature approved AB 1839 in 2014, which implemented a five-year production tax incentive for feature films and TV series, capped at $330 million annually.  This 2.0 Program included various improvements, including replacing the old lottery system with a jobs ratio ranking system, whereby applications are ranked based upon the number of jobs created and other economic factors, as well as providing special incentives to lure television programs back to the state.

“The MPAA and its member companies are grateful to the leadership of the California legislature for extending the state’s film and television production incentive program,” stated Charles Rivkin, Chairman and CEO of the Motion Picture Association of America. “We are especially grateful for the support of Senator Holly Mitchell and Assembly Majority Leader Ian Calderon, who authored key legislation and Governor Jerry Brown, for signing the bill into law. As the birthplace of American cinema, California has seen a fledgling industry grow into a global economic powerhouse that today supports the livelihoods of more than 715,000 Californians. The enactment of this bill helps ensure that California will be home to many more productions, jobs, and local businesses for years to come.”

The California Film and Television Tax Credit Program has a proven track record of creating and retaining jobs in the film industry.  It incentivizes the creation of the good, middle-class “below-the-line” jobs for workers who do technical work, such as creating props, building sets, applying make-up, finding locations and all the work behind the scenes that makes production possible. The benefits extend beyond the thousands employed in film and television production to the ancillary businesses that serve the production sites and teams, such as the caterers, hotels, set construction companies, restaurants, and much more.

“The California IATSE Council and our over 42,000 members in California enthusiastically thank Majority Leader Calderon for his leadership, determination to push through any obstacles, and abiding commitment to the extension of the California Film and Television Tax Credit Program 2.0 through 2025,” stated Thom Davis, President of the California IATSE Council. “This legislation, originally AB 1734, now SB 871, means so much to the men and women who work behind the scenes and who are hit hard when film and television production leaves California. Thanks to Majority Leader Calderon’s signature legislation, they can continue to work here and remain with their families, contributing their talent and the revenue generated by their work back to their home state—California.”

Highlights of the 2018 California Film and Television Tax Credit Program:

SB 871 extends the California Film and Television Tax Credit Program until July 1, 2025.  The bill retains important provisions of the previous tax credit, including:

  • Awards tax credits according to a jobs ratio rating system, whereby applications are ranked based upon the number of jobs created and other economic factors;
  • Ensures that similar productions compete against each other by establishing separate “buckets” for feature films, television series and independent productions;
  • Retains a special category – and additional credit – for TV series that are relocating from filming outside of California;
  • Offers an additional 5% tax credit increase for production outside the Los Angeles 30-mile zone.

SB 871 will also improve upon the existing program:

  • Creates a one of a kind, first in the country pilot program – the Career Pathways Training Program - for training Californians from under-served communities for careers - not temporary jobs - in the skilled craft occupations in motion picture and television productions (below the line positions).
  • Addresses diversity in “above-the-line” (actors, writers, directors, producers) jobs by providing for a voluntary survey of employees and the disclosure of programs and initiatives to increase the representations of minorities and women;
  • Incentivizes the use of California musicians for film and television scoring
  • Requires that employers/applicants provide their harassment prevention policies, including who receives such complaints, procedures for reporting and investigating, distribution of harassment prevention policies to employees and statement there will be no retaliation;   
  • Allocates more tax credits to projects produced by independent (non-publicly traded studio) production companies;
  • Creates an additional 5% incentive for the hiring of locally based crew members when productions film outside the Los Angeles 30-mile zone;

As of today, the California Film Commission reported that 150 feature films and TV series were produced or scheduled to be produced in California with total expenditures of $5.9 Billion. More than 47,000 California cast and crew members have been or will be employed on approved, qualified projects.

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Contact: Lerna Shirinian, (562) 692-5858