Last week Governor Brown signed into law a bill to increase the tax incentives offered to film and television productions that shoot in California. The measure increases the previous commitment of $100 million a year to $330 million a year for the next five years. The law also ends a relatively discredited lottery system that previously allocated applicants for the incentive and replaces it with one that distributes the funding based principally on the number of jobs created by the productions seeking the tax incentives. The approach is designed to lure the larger studio and network productions, which have fled California for friendlier pastures in droves, back to the Golden State. 
While some in Sacramento have lauded the recent efforts of lawmakers and Governor Jerry Brown to expand the tax incentive program, the reality is that Hollywood’s historic home remains in significant danger of losing its status as the filmmaking hub of the world. Georgia, Louisiana, and New York each continue to offer more substantial tax incentive programs, even after the increase passed by the California legislature. Both Georgia and Louisiana have an uncapped rebate program (which could be significantly higher than $330 million a year), and New York’s is north of $400 million a year. Additionally, the competition for hosting film production has gone global as entire countries have jumped onto the tax incentive bandwagon to pull additional filming away from California. HBO’s hit show GAME OF THRONES, for example, primarily films in Ireland, Iceland, Croatia, and Morocco, largely due to tax incentives offered in each jurisdiction. Though $330 million sounds like a great deal of funding, it could be eaten up entirely by just a handful of large studio projects, which typically see budget ranges from $75-150 million. While it would be welcome to have at least some of that work come back to California, and the lawmakers should be commended for doing something, the amount is nonetheless unlikely to have a significant impact on the downward trend for California filming.
Feature film and television pilot production are both considerably lower over the course of the past decade as rival states and countries ramped up efforts to provide monetary incentives to attract production. By FilmL.A.’s count, feature film production in California has fallen by half since 1996 and television pilot production has decreased dramatically, by 73 percent, since hitting its peak in 2007. Though the number of actual film permits within California has not seen such a dramatic drop-off, a closer examination of the figure yields the answer as to why the number of permits has not decreased with the exodus of large scale film productions. With the advent of digital based platforms such as YouTube, micro-budget (and in many cases, near zero budget) productions driven by students, startups, or small scale productions with internet based means of distribution have contributed to the film permitting offices continued business in the wake of evaporating studio projects. It should come as no surprise that the infrastructure required to feed major feature films and network projects is extraordinarily higher than that needed for much smaller productions. As go the large projects, so go the jobs. $330 million is likely to do little to change that.
Ben Everard is a contributor to Capoliticalreview.
*Disclosure: the author is a member of the Community Relations subcommittee board for FilmL.A.
Speak Your Mind