Gov. Newsom signs bill creating new stand-alone post-production tax credit
California's film industry rejoiced on Saturday as Gov. Gavin Newsom signed a bill that will create a post-production tax credit and hopefully keep the work in Hollywood.
"It's a glimmer of hope. We're a community of dreamers; that's why we came here to California," said Ben Urquhart, a post-production executive and board member of the California Post Alliance. "That's why we work here, and it's been really hard."
In recent years, post-production crews have watched visual effects, sound and music work projects offered in other states, where there are better tax incentives. Now, with the signing of Assembly Bill 2319, they're hopeful that the Golden State can compete.
"We're simply trying to make California competitive again to keep our jobs," said Assemblymember Nick Schultz, who wrote the bill.
While he initially pushed for a $100 million program, legislators eventually fell back to $10 million. Schultz and post-production crews said they're hopeful that the credit helps put California back in the picture.
"We all feel really good. Is it enough money? No. We want more, and we intend to go back to the state for more, because we believe, and our economic data shows that we are a real economic engine for California," Urquhart said.
Post-production work done in California will be eligible for a tax credit worth between 35% and 50% of certain costs, and projects don't have to be filmed in California to qualify.
"Say your movie is set in Jamaica or Italy, you want to go there and film, but then now you can bring that work back to California and get a credit for it," Urquhart said.
Newsom joined film industry leaders at the Television Academy in North Hollywood on Friday to sign AB 2319 and Senate Bill 186, which exempts independent film projects from the state's $5 million corporate tax credit cap, extends the expiration for older, non-refundable tax credits from nine years to 15 years and accelerates the payback period for productions that monetize refundable tax credits.
"California is the nation's entertainment capital. It is the home of storytellers, dreamers, artists, entrepreneurs, and creators who define culture for the rest of the world," Newsom said in a statement. "This legislation protects the extraordinary people who make this industry possible and makes it unmistakably clear: California is still the future of film and television."
Los Angeles-area leaders also celebrated the bill on Saturday, including Mayor Karen Bass and her opponent in the upcoming mayoral race, Nithya Raman.
"This is an historic day for Hollywood. I want to thank Governor Newsom for continuing to be a champion of LA's entertainment industry and joining us in our work to ensure that Los Angeles remains the entertainment capital of the world," Bass said in a statement. "I have spent my career fighting for the entertainment industry, including as Speaker of the State Assembly where I oversaw the passage of the inaugural Film and TV Tax Credit Program."
Raman also thanked Newsom and legislators for moving the bills into law.
"Hollywood jobs are critical to Los Angeles and we are losing far too many of them. AB 186 and AB 2319 are urgently needed steps to bring production back to California and keep the editors, visual-effects artists, musicians, sound professionals and craftspeople who finish that work employed here," Raman's statement said.
