Los Angeles Business Journal

Production Incentive Bill Advances

By Business Journal Staff Wednesday, June 25, 2014

A California Senate committee approved on Wednesday proposed legislation to renew the film and television tax credit program to keep production in the state.

The vote came a day after a study released by FilmL.A. concluded that tax incentive programs in other states contributed to significant television pilot production leaving California during the 2013-14 development season.

The bill passed by the Governance and Finance Committee, AB 1839, now goes to the Senate Appropriations Committee. The Assembly passed the bill, sponsored by San Fernando Valley area Assemblymen Mike Gatto, D-Los Angeles, and Raul Bocanegra, D-Pacoima, on May 28.

The state’s production tax credit program began in 2009 as a response to television and feature films leaving California. The program is administered by the California Film Commission and receives $100 million in funding annually although supporters would like to see the amount increased.

The bill moving through the Senate would continue the tax credit program through the 2020-2021 fiscal year, and open the program to feature films of any budget size, television pilots and new hour-long series regardless if they are on broadcast TV, cable or the Internet.

In the study released Tuesday by FilmL.A., incentives offered by other locales were cited as contributing to television pilot production leaving the region.

For the 2013-14 television season, there were 203 pilots made for broadcast, cable and new-media distribution with Los Angeles getting 90, or 44 percent. Top competitors included New York, Georgia and Canada.

Los Angeles had 52 percent of pilot production the previous development season, and had a high of 82 percent in 2006-2007.

New York even displaced Los Angeles in production of one-hour drama pilots, with 24 versus the 19 shows done locally. It is a significant figure because drama pilots cost more than comedies and can employ between 150 people and 230 people, according to the study.

“Indeed, the availability of generous financial incentives and the availability of an established and/or rapidly growing production infrastructure proved decisive for two of L.A.’s top competitors: New York & Georgia,” the study said.

California’s incentive program has showed some success, with seven series filmed in the Los Angeles area this year after pilots were made elsewhere.

FilmL.A. is a Hollywood non-profit that handles production permitting in the city, unincorporated neighborhoods and other local jurisdictions. The agency tracks local on-location filming of television series, feature films, commercials, television webisodes and student projects.