California legislators are preparing to debate a billdesigned to stem the tide of runaway productions and help restore the notional"Hollywood" to its rightful home.

The move follows years of vocal agitation by Californian industryworkers troubled by the exodus of productions to more cost-effective shootinglocations such as those in Canada, Eastern Europe and North Africa, and comeshot on the heels of a raft of tax incentive schemes launched by other USstates.

According to a report in the New York Times the bill, set to be heard by the StateSenate Appropriations Committee next Monday [Aug 22], would provide a 12% taxcredit on any project's California production spend, up to a cap of $3m.

If the bill goes through in its current formulation, an annual$50m would be set aside for the incentive - that's twice the amount availablefor New York shoots and only just shy of the $65m in credits currently offeredby the state of Louisiana each year to boost its thriving filmmaking economy.

(For a detailed breakdown of how the New York production incentivescheme works read this week's edition of Screen International).

To qualify for the proposed California breaks, 75% of the shoot wouldneed to take place within the State.

Productions would be dealt with on a first-come, first-serve basisand would need to commence shooting within five months of approval to avoidcredit forfeiture.

To avoid subsidising studios and talent salaries, overhead anddistribution costs would be excluded and the bill would only allow the first$25,000 of salaries for stars, directors, and other above-the-line talent tocount toward in-state spending.

Credits would be refundable, enabling a producer with no taxliability to recoup the full amount of the credit in cash.

It is understood new one-hour television series and seriescurrently produced outside California would be eligible, as would televisionfilms, which may qualify for an additional 3% credit.

Television show formats covering news, sports, talk, quizzes,awards, telethons, reality TV, animation, as well as student and industrialfilms and pornography would be ineligible because they are deemed unlikely togo elsewhere for financial reasons.

In recent years Californian industry workers have called for arobust and enterprising tax incentive scheme along the lines of thoseestablished in other states like New York, New Mexico, Louisiana, and NewJersey.

Figures released by Los Angeles' Entertainment IndustryDevelopment Corporation reveal the level of feature film production days in thecity has plummeted by 37% over the last nine years, from 13,980 in 1996 to8,707 last year. The data excludes production on studio lots, where permits arenot required.

The New YorkTimes report goes on tosay that recent tax incentives in Louisiana has boosted film and televisionproduction spending from $20 million in 2002 to a projected $425 million thisyear.

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