The Los Angeles County Economic Development Corporation is standing by its study on California’s film tax credit program. The LAEDC today released a letter to the California Legislative Analyst’s Office defending the methodology and results of its study that assessed the state’s return from the tax credit program. Last week, the LAO said that the tax credit program results in an overall loss of tax dollars, a finding that ran counter to both the LAEDC study and another by the UCLA Institute for Research on Labor and Employment. The LAEDC concluded that every tax dollar returned $1.13 to the state, while the LAO estimated that the revenue generated is likely to be less than $1 for every tax credit dollar. The letter said the LAEDC study, along with UCLA-IRLE and 2 other Milken Institute studies determined that the California film and television tax credit program has a net positive fiscal impact. While LAEDC’s may vary by a few pennies, the letter said, all agree that runaway production is a big problem for California and that states like Louisiana and New York are setting production records at California’s economic expense. The reports come as California lawmakers consider extending a $100 million annual film tax credit for five more years.
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