Hollywood sign pixabay

Source: Pixabay

Overall in-state spending by projects in California’s Film & TV Tax Credit Program grew by more than $200m in fiscal 2021-22 from $2.1bn to $2.3bn.

California Film Commission’s annual progress report also found that projected spend by productions entering the tax credit programme during the first half of the current fiscal year (July 1, 2022–June 30, 2023) is on track to reach $1.6bn, while total estimated spend halfway through the current five-year tax credit programme launched in July 2020 will reach $6.2bn.

“California’s iconic film industry continues to create opportunity and drive economic growth throughout our state,” said Governor Gavin Newsom. “Today’s report from the California Film Commission affirms the tax credit program continues to produce outstanding results and foster diversity and inclusion for a workforce that better reflects our vibrant communities.”

“The competition today is global, so it’s wonderful to see our state’s commitment to maintaining our status as the world’s film and TV production capital,” said California Film Commission executive director Colleen Bell. “The tax credit program is an incredibly effective tool, and today’s report confirms it’s working precisely as intended.”

Direct spending by projects in Program 3.0, the third iteraiton of the state’s tax credit programme, includes qualified spending (wages paid to below-the-line workers and payments to in-state vendors) and non-qualified spending (all other spending, which includes payments to above-the-line individuals like writers, directors, actors and producers). Only the qualified portion of a budget is eligible for tax credits in California’s incentive programme.

Qualified spending for the second fiscal year of Program 3.0 reached an estimated $1.4bn. The first half of the current (third) fiscal year has reached an estimated $1bn in qualified spending.

Aggregate qualified spending by tax credit projects through the first two-and-a-half years of Program 3.0 is projected to reach an estimated $4.2bn, yielding $2bn in unqualified (unincentivised) state-wide spending. These figures are based on tax credit allocations of $265m for fiscal year-one, $277m for fiscal year-two, and $184m for the first half of fiscal year-three.

The report also found that the 106 approved projects selected for year-two of Program 3.0 are on track to employ a combined 8,135 crew, 4,111 cast and 79,248 background actors/stand-ins (measured in “man-days”) during 2,421 filming days in California.

Projects selected for the first half of fiscal year-three are on track to employ 4,497 crew, 1,141 cast and 50,458 background actors/stand ins during 1,297 filming days. In aggregate, the first two-and-a-half years of Program 3.0 are on track to employ a total of 18,736 crew, 9,833 cast and 204,700 background actors/stand-ins with 5,900 filming days.

Program 3.0 includes several new and ongoing initiatives to promote workforce training, diversity and inclusion. The Career Readiness requirement (continued from Program 2.0) mandates that all tax credit projects participate in learning and training programmes for students based in California. In collaboration with the California Department of Education and the California Community Colleges Chancellor’s office, tax credit projects have fulfilled the requirement by hiring students for paid internships, welcoming faculty members for externships, hosting workshops/panels and staging professional skills tours.

The new Career Pathways Program targets individuals from underserved communities and is funded directly by tax credit projects and works with partner training programs across the state. A total of 141 individuals have participated in the program: 30 with Hollywood CPR, 39 with ManifestWorks, and 17 with IATSE Local 695’s SVOP Y-16A – all during year-two of Program 3.0.

During its second fiscal year, Program 3.0 welcomed two relocating TV series from Vancouver and Georgia. The first half of the current (third) fiscal year has brought two additional relocating series from New Orleans and Florida. To date 27 TV series have relocated to California under different iterations of the state’s tax credit programme.

During its second fiscal year, Program 3.0 welcomed five films above $60m budgets that are on track to bring an estimated $738m in direct in-state spending. Projects include Atlas, Beverly Hills Cop 4, and Unfrosted. An additional four big-budget film projects are in process in the first half of the current fiscal year including Joker: Folie a Deux and The Thomas Crown Affair. Thus far Program 3.0 has welcomed 11 big-budget films – or half of the 22 feature films accepted into the programme thus far.