PRODUCTION INCENTIVES

• What's New
• Updates by Jurisdiction
• Upcoming Appearances
• Maximize Your Incentives with EP

The Essential Guide to U.S. & International Production Incentives, 2011, 1st Edition, edited by Joseph Chianese, Marco Cordova, and Barbara Rosenfeld, is now available. Contact our Incentives Group today to order your copy at no charge.

U.S. Updates
For more information on incentives in each state, visit the U.S. Overview on our website and click on the state of interest.

ALASKA
Proposed legislation (SB 23) to extend the film tax credit through June 30, 2018, and double the original funding passed in the Senate, but was tabled by the House until the next legislative session. (See KTVA)

CALIFORNIA
Proposed legislation (AB 1069) to extend the Film Commission's requirement to allocate motion picture tax credits for an additional five years (through June 30, 2019) is set for a public hearing May 16, 2011. The bill would also extend the aggregate amount of credits that may be allocated through the 2018-2019 fiscal year.

ILLINOIS
Proposed legislation (SB 4) creating a sunset date for the film tax credit was passed, as was another bill (SB 398) extending the newly enacted sunset date for the film tax credit through 2021. Both bills are awaiting the Governor's signature. Another bill (SB 1286) proposed to expand the existing incentive to cover accredited animation projects, talk shows, and reality programming.

LOUISIANA
The Economic Development Office retained a consulting group to conduct an economic and fiscal assessment of the State's entertainment incentives between 2008 and 2010. That report concludes that for every dollar of tax credits issued for film production, $5.71 was generated in total economic output. Additional data is provided for other sectors of the entertainment industry.

MARYLAND
Governor O'Malley is expected to sign SB 672, which was passed in the legislature earlier this month. If signed, the bill would repeal the former film production rebate and replace it with a refundable tax credit. In addition, the annual aggregate incentive cap will be increased from $1,000,000 to $7,500,000. Unused amounts, if any, will carry over to the following year.

The incentive rate remains at 25% except for television series, which may be eligible for 27% of qualifying local spend. The minimum qualifying local spend is unchanged, and must exceed $500,000. The new law excludes compensation paid to a person who earns more than $500,000 from "qualifying" expenditures.

The next scheduled date for the Governor to sign legislation is May 10, 2011. If signed, this incentive will become effective July 1, 2011, and terminate in three years, at the end of June 2014.

MONTANA
Proposed legislation (SB 253), which would have repealed the film tax credit, has been amended to exclude the film tax credit among those credits that will be repealed if the bill is signed into law. The film tax credit remains intact until December 31, 2014.

NEVADA
Proposed legislation (AB 506) to create a transferable tax credit for qualifying film productions has been referred to committee. As currently drafted, the incentive would be based on 25% of qualifying local spend with a 5% bonus for hiring residents. Additional tax relief on sales, lodging, etc., is included.

NEW MEXICO
The Film Office has provided its interpretation of the changes to the incentive law effective July 1, 2011, pending issuance of official administrative and transition rules. The "nuts and bolts" interpretation includes information about: the $50,000,000 "rolling cap," deferred payments, claiming the credit, mandatory personal income tax withholding at 4.9% on nonresident actors, limitations on certain expenditures, audit requirements for larger budget projects, vendor requirements, reporting/transparency requirements, etc.

For information regarding the incentive in effect until July 1, see our New Mexico jurisdiction page.

NEW YORK
Proposed legislation (A 7228/S 4527-A) has been introduced, which if passed, would increase the incentive rate for the commercial production tax credit from 3% to 4.5%, and increase the annual cap from $7,000,000 to $10,000,000 annually.

OREGON
A second public hearing has been scheduled on proposed legislation (HB 2167) that would cap total reimbursements to "local filmmakers" at $500,000 per fiscal year, extend the sunset date for claiming tax credits for contributions to the Oregon Production Investment Fund (OPIF), and extend the sunset date for the Greenlight Oregon Labor Rebate (GOLR) through December 31, 2017, with various effective dates.

TENNESSEE
The state film office is moving from under the auspices of the Tennessee Film, Entertainment, and Music Commission into the Department of Economic and Community Development. Perry Gibson will assist in the move before leaving her current post as Executive Director. (See NashvilleScene)

WISCONSIN
Proposed legislation (SB 27 and AB 40) "constituting the executive budget act" has been introduced. The legislation would transfer the Department of Commerce's duties under the film production credit to the Department of Tourism, and makes conforming statutory changes. Budget allocations for 2011-2012 and 2012-2013 are set at $100,000 per year and $400,000 per year for the film production company investment and film production services credits, respectively.

International Updates
For more information on incentives around the world, visit our website and click on the region or country of interest.

THAILAND
ScreenDaily reports that Thailand has agreed to exempt non-resident actors from paying its income tax on compensation for services rendered in the country. Previously, the rate had been lowered from 30% to 10%. The exemption is in effect for five years. The local industry continues its efforts to obtain additional incentives to compete internationally. (Subscription required to view article link)

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Atlanta Film Festival
W Hotel Midtown
April 30, 2011
Joseph Chianese is speaking on two panels as part of this year's Atlanta Film Festival CINformation Seminars. He will speak on "The Impact and Importance of Film Tax Incentives" from 9:00 am - 10:30 am, where film industry leaders discuss the importance of film tax incentives in bringing business, jobs, and revenue to the state. He will also speak from 11:00 am - 12:30 pm on a panel entitled "Legal, Business, and Financing Structure," where panelists will answer questions regarding corporate organization, business structure, and the importance and logistics of careful financing. Register to attend.

Thinking Big: Transatlantic Tax Incentives for Film
Princess Anne Theatre, 195 Piccadilly, London, W1J 9LN
May 20, 2011
Joseph Chianese will participate in a tax incentives panel hosted by the British Academy of Film and Television Arts (BAFTA) and EP's affiliate, Sargent-Disc. The event will provide detail on what types of incentives exist in Canada and the US, and compare them with the incentives in the UK. Other panelists include David Carter (President of Canada Film Capital) and John Graydon (Director of Business Services Film Unit, RSM Tenon Media). The panel takes place at the Princess Anne Theatre in London. Sign up to attend.

Produced By Conference in Association with AFCI Locations
Walt Disney Studios, Burbank, CA
June 3 - 5, 2011
Entertainment Partners will sponsor the PGA's annual ProShow competition. The winning producers will receive Movie Magic Budgeting 7 software and production consulting services. In addition, Joseph Chianese will moderate the Tax Incentives Workshop panel. More details to be announced soon! Register for the conference online.

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