PRODUCTION INCENTIVES

• Updated film commission information for LOUISIANA and ISRAEL.
• Proposed legislation updates for:
• DISTRICT of COLUMBIA
• NORTH CAROLINA (no current legislation pending)
• PUERTO RICO (no current legislation pending)
  
  

CALIFORNIA - San Francisco

• Compensation and Project Caps/Funding Per Year: $600,000 project cap; $1,800,000 in funding committed over three year period beginning July 1, 2009; the Board of Supervisors has authorized $400,000 for the 2009-2010 fiscal year; once the $400,000 is depleted, the Board can authorize additional amounts
  
  

CONNECTICUT

• Maximum Benefit: 30% of production expenses with phase out of those incurred outside the state and used within (January 1, 2009 = 50% exclusion, January 1, 2012 = 100% exclusion); 10% to 20% of qualifying infrastructure investments; 30% of qualifying digital animation production costs, including optioning or purchase of IP rights if such expenses are < 35% of the costs incurred by the eligible production company (maintaining facilities within the state, employing &ge; 200 full-time employees within the state); effective for tax years beginning January 1, 2010, the film and digital animation tax credits are tiered based on local spend from 10% to 30%; the infrastructure tax credit is 20%; no expenses incurred outside the state and used within are qualified
• Compensation and Project Caps/Funding Per Year: Compensation is capped at $15,000,000 per person; no project caps for the production expense and infrastructure credits; the digital animation production credit is capped at $15,000,000 per year; beginning January 1, 2010, there is an aggregate "star talent" compensation project cap (subject to local income tax) of $20,000,000; the infrastructure project credit voucher is not available until the project is complete
• Project Criteria: Minimum spend for the production expense credit is > $50,000 per year (an interactive website must spend > $500,000 per year); for state-certified infrastructure projects costing > $15,000 and < $150,000, the credit is 10% of the investment; if the cost is &ge; $150,000 but < $1,000,000, the credit is 15% of the investment; and for projects costing &ge; $1,000,000, the credit is 20%); for tax years beginning January 1, 2010, a 10% credit is available for minimum qualifying local spend of $100,000 to $500,000; a credit of 15% is available for spend of $501,000 to $1,000,0000; and a 30% credit is available for a qualifying local spend in excess of $1,000,000 for the film and digital animation credits; film projects must meet a 50% local principal photography requirement
• Sunset/Review: None; review annually for "Workforce Competitiveness" status report; sections 12-217jj, kk, and ll are amended, subject to annual review
  
  

DISTRICT of COLUMBIA

• Maximum Benefit: The lesser of 10% of qualified spend, or 100% of the sales and use taxes paid to the District on qualified expenses; effective October 1, 2009, and subject to available funding, the incentive is increased to 42% of qualifying direct production expenditures subject to DC tax or 21% of those that are not subject to DC tax; 30% of the qualified personnel expenditures; 50% of qualified job training expenditures and 25% of the base infrastructure investment
• Compensation and Project Caps/Funding Per Year: $1,600,000 per year (as of August 6, 2009, no funding remains for the current fiscal year ending September 30, 2009); funding for the 2010 fiscal year is yet to be determined
• Project Criteria: Minimum local spend = $500,000, and must film for 5 or more days in the District; effective October 1, 2009, the minimum spend is $250,000
  
  

NORTH CAROLINA

• Maximum Benefit: 15% of qualifying local spend (NC income tax credits are subject to NC tax; therefore, net film credit is 13.97% after tax); beginning January 1, 2010, an "alternative" refundable credit has been added at the rate of 25%, subject to sales and use tax adjustments and the state income tax
  
  

OHIO

• Governor Strickland signed the incentive legislation on July 17, 2009, but the Ohio Motion Picture Tax Credit program will not be effective until 90 days after signature. In the meantime, eligible expenditures accrue from the date of signature but the refund cannot be paid until the 90 days pass as the credit is conditional and subject to rescission by referendum until October 16, 2009.
  
  

OKLAHOMA

• Rebates are not payable until July 1, 2010, in the order they are approved; payments of approved claims in excess of the annual funding will roll over to the following year. The sales tax exemption cannot be used in conjunction with the cash rebate.
  
  

PUERTO RICO

• Sunset/Review: December 31, 2019
  
  

TENNESSEE

• Maximum Benefit: 17% of qualifying local spend (from Film Commission) and an additional 15% refund for qualifying local headquarters (from Department of Revenue)
• Compensation and Project Caps/Funding Per Year: All personnel salaries and fees capped at $250,000 for the film and television production incentive; funded by gifts, grants, donations and appropriations by the General Assembly, with approximately $9,300,000 available on September 8, 2009
• Project Criteria: Minimum local spend within 12 months of Certificate of Conditional Eligibility = $500,000 if headquartered outside the state, and $150,000 if within; declaration of residence required for qualifying TN payroll (the Commission has discretion to deviate from these requirements when a production is determined to have a beneficial impact on the State); $1,000,000 local spend to qualify for the headquarters rebate from the Department of Revenue
  
  

CANADA - Alberta

• Maximum Benefit: 14% to 23% of qualifying Alberta (AB) spend (goods and services); there are 3 "Streams" of Alberta ownership which determine the amount of the benefit available: Stream I - Majority Albertan-Owned Productions with 2 AB keys = 21 %; Stream II - Equal or Minority Albertan Ownership with 1 AB key = 19 %; Stream III - No Albertan Ownership (foreign ownership is permissible) = 14 %; BONUSES: Each Stream can earn an additional 1 to 2 % of production expenses by employing additional Albertans in key creative positions
• Compensation and Project Caps/Funding Per Year: Cap per project = C$3,000,000; no annual funding cap
  
  

NEW ZEALAND

• Compensation and Project Caps/Funding Per Year: There is no ceiling on compensation for LBSP and PDV; maximum amount eligible for QNZPE for any individual project is NZ$15,000,000 for SPIF Grant; no caps on projects or funding per year for LBSP and PDV