A new bill intended to expand and overhaul California’s current $100 million Film and TV Tax Credit program passed its first legislative test today as the state Assembly’s Arts, Entertainment, Sports, Tourism, And Internet Media committee voted unanimously in support of the measure. Introduced on February 19, the California Film and Television Job and Promotion Act now moves to the Revenue and Taxation Committee and then the Appropriations committee as it heads its way to a full vote, a state Senate twin and eventually Gov. Jerry Brown‘s desk by the end of the summer. A long political route that AB 1839’s backers think will prove successful. “We’ve worked very hard to make this bigger, smarter and more thoughtful than the existing tax credit,” said co-author Assemblymen Mike Gatto (D-Los Angeles) today at beginning of hearing in the state capitol building in Sacramento. “This measure comes down to one thing and one thing only and that is retaining jobs and protecting California’s economy.”
Proposed last month by Appropriations chair Gatto and fellow Assemblyman and Revenue and Taxation chair Raul Bocanegra (D-Pacoima), with 59 co-sponsors from both sides of the aisle, AB 1839 drew wide spread industry support at today’s hearing. Representatives from the MPAA, representing all the studios plus CBS and HBO, the DGA, a number of IASTE locals, LA Mayor Eric Garcetti’s office, the California Labor Association, the cities of West Hollywood and San Francisco, SAG-AFTRA, and various local film commissions were among those voicing their backing of the bill before the committee. And to the man and woman, the mantra was keeping Hollywood in Hollywood and jobs, jobs jobs. “The situation now is that to feed your family you have to leave your family and the toll is a great one,” said Kathy Garmezy of the DGA about how many Tinseltown-based professionals find themselves working out of California in richer tax incentive states for months at a time. “At the end of the day this is a jobs bill,” said Bocanegra before the committee. “We need to hold the line and keep these jobs, many of them union jobs in California,” he added later.
However today’s hearing wasn’t a total lovefest for the proposed bill. The influential California Teachers’ Association and the California School Employees Association appeared in opposition to AB 1839. The former claim that the money could be better spent developing jobs in other industries while the latter said that with the past cuts in education funding and the failure of other tax credits programs in the past there are more pressing needs for state funds like rehiring teachers. As of yet the now-officially running for reelection Gov. Brown not come out in support of increasing the state’s current $100 million annual incentive.
While AB 1839 has no dollar figure attached to it yet, the bill proposes, among other measures, allowing tentpole pics and network pilots to now be eligible for state tax incentives – a big change from the current program. “Bigger budgeted movies create the most jobs, they are the most stable and they are around for an awful long time,” noted Gatto today. With big incentives offered in UK, Canada and other states like Georgia, Louisiana and New York, the Golden State has suffered a huge drop in recent years in the number of tentpoles made in California. Even with an increase in overall feature production in California last year, the only 2014-released pics with budgets of more than $100 million that were even partly made in Cali are Interstellar and Disney/Marvel’s about to be released Captain America: The Winter Solder.
To counter that and other aspect of runaway productions, various committee members today talked wanting to see the incentive raised to $430 million a year or $500 million a year to best New York’s $420 million-plus program, currently the highest in the nation. “This is our industry to keep or lose,” said Assemblyman Richard Bloom (D – Santa Monica) “The Governor of New York brags about the jobs he is taking out of the state of California, he added. “And we have to say, it stops here. We’re taking a stand, we’re fighting for this industry and we’re going to do what it takes to keep the industry here. And I say that is in excess of $430 million dollars.”
That’s close to the $400 million figure that industry heavyweights are talking about privately but any figure is premature right say the bill’s joint authors and that’s why they left it blank. “That was done intentionally,” said Bocanegra today about the lack of a dollar figure in his bill. “Both myself and Chairman Gatto listened to many stakeholders in this area and we believe that as the bill moves along, as we find out more information as to what our budget forecast is, and the revise and certainly as we go to the fiscal committee, we’ll have that firmed up for you in a very short order in the next few months.”
The Arts, Entertainment, Sports, Tourism, And Internet Media committee is chaired by Ian Calderon (D-Industry) with Republican Marie Waldron as Vice-Chair. Democrats Richard Bloom, Cheryl R. Brown, Jimmy Gomez, Marc Levine and Republican Scott Wilk serve on the committee.