A bill to expand the state's film and TV tax credit program cleared another step in the state legislature on Tuesday.
The bill, introduced by state legislators Mike Gatto (D-Los Angeles) and Raul Bocanegra (D-Pacoima), passed the Assembly Arts, Entertainment, Sports, Tourism and Internet Media Committee. Before coming to a house vote, the bill will need the approval of two more Assembly committees: Revenue and Taxation; and Appropriations. The bill would later go through a similar process in the senate.
“We can’t sit by and watch a $17 billion dollar a year sector of our economy leave California,” Bocanegra said in a press release. “This expanded and improved program will go a long way towards making California more competitive with other state’s programs."
Currently, California offers $100 million in film tax credits each year, when competing states like New York offer roughly four times that amount. The bill would allow big budget feature films to apply for the financial incentives and let TV pilots and new one-hour TV series--regardless of where or how they're distributed, apply for the credits.
There has been talk about raising the amount of tax credits California offers, but legislators have been vague about exactly how much the increase will be.
The move comes as the entertainment industry has expressed concerns about film production moving to other states like New York. A recent report by the Milken Institute, a non-profit think tank, showed California lost 16,137 jobs from 2004 to 2012, where New York gained 10,675 jobs in the same time period.
But there have been vocal opponents to the increasing the amount of tax credits the state gives to film production.
"Increasing the credit will be a temporary solution and may not even be a solution because other states will make their credits more generous," said Joseph Henchman, who oversees the Tax Foundation's state policy and legal programs, in an interview with KPCC.