African-Americans got only 4% of the below-the-line jobs created during the first phase of California’s film tax incentives program, and women only got 29% of those jobs, according Amy Lemisch, executive director of the California Film Commission. In testimony at a hearing today before two committees of the state Legislature, she noted that Hispanics fared considerably better, landing 11% of the below-the-line jobs.
Asian-Americans got only 2% of the below-the-line jobs, and Native Americans got 1%, she said. White workers got 65% of the jobs, and “other” got 17%. She noted that of the women employed in below-the-line positions on the films and TV shows that received tax credits in the first phase of the incentives program, 56% were white. Asian-American women, at 11%, got more than Hispanic (5%) and African American women (5%) combined. Native Americans got 1% and “other” got 20%.
Data is not yet available, Lemisch said, for the second phase of the incentives program, which kicked in a year and a half ago and now provides $330 million annually in tax credits for qualified projects.
The hearing, chaired by assemblymen Sebastian Ridley-Thomas Kansen Chu, was held to explore whether adding diversity benchmarks to the state’s film incentives program could increase those numbers.
“This joint informational hearing seeks to better understand the economic impact of the tax credit,” Ridley-Thomas and Chu said in a joint statement. “In particular, this hearing will explore whether a secondary impact of the tax credit has been to increase diversity in employment in the film and television industry, both above and below the line. As existing jobs are retained and new jobs are created in California, it is important to evaluate whether these jobs are reaching a diverse cross-section of communities and whether the program is generating the maximum possible economic return on investment for all California taxpayers.”
Similar efforts have been undertaken in New York and Illinois. Last year, legislators in New York considered setting aside $5 million of the state’s existing $420 million tax credit for TV productions that promote diversity among writers and directors. The legislation, which has yet to become law, would have qualified the salaries of women and minority TV writers and directors as “eligible costs” to be covered by the tax credit.
Illinois, however, has set diversity benchmarks as part of its film incentives program, requiring that all film tax credit applicants must submit a diversity plan that details how they propose to ensure employment of a diverse crew that is representative of the state, and document “good faith efforts” to carry out the plan. In addition, applicants can be denied the tax credit if the production has low racial or gender diversity among its crew. Applicants can also receive an additional 15% tax credit on salaries of individuals living in economically disadvantaged areas with at least 13.8% unemployment.
Hollywood rolled out its big guns for the hearing, with representatives from the MPAA and all the major guilds and unions providing testimony. All agreed that the state’s tax incentives have increased employment for their members, but none offered an opinion about whether adding diversity incentives to the tax program would be desirable or feasible. Instead, they talked about what their unions and companies were doing on their own to increase diversity.
“The question this hearing raises – is diversity in the film and TV industry increased because of California’s Film and Television Tax Credit program? – can be answered with a yes,” said Angela Miele, the MPAA’s vice president of state tax policy. “The tax credit program has returned many jobs to California and is driving employment capacity, especially in below-the-line positions. With the increased level of employment comes more opportunities for more Californians from diverse backgrounds to join this workforce. We are committed to building on the momentum created by the tax incentive program. We have not achieved all that is possible with regard to diversity, but the story so far is one of improvement and growth of opportunity.”
“The MPAA is committed to diversity,” she said, noting that ABC/Disney, NBCUniversal, Paramount/Viacom, Sony Pictures, Warner Bros., 21st Century Fox and HBO all have diversity programs.
“The Tax Credit has had the intended effect of boosting the economy in Los Angeles, one of the most diverse cities in the country,” said Corrina Freedman, the WGA West’s political director. “The guild strongly supports the tax credit and we are also taking on the issue of diversity among storytellers with several of our own initiatives.”
Steve Dayan, secretary-treasurer of Teamsters Local 399 and chairman of the board of the California Film Commission, said that the first phase of the incentives program – which offered only $110 million annually in tax incentives, “slowed the hemorrhaging” of jobs to other states, but noted that it wasn’t until the incentives were tripled in 2015 that the tide of job loss has been turned. “It has made a huge difference to our members,” he said. Last year, he said, his local was at “full employment,” and noted that two-thirds of the 240 new members his local has taken in during the last year were from ethnic minorities.
Mayra Ocampo, the DGA’s assistant executive director, talked about the numerous diversity initiatives the guild has undertaken, noting that under the DGA’s contract, “All the major TV studios have established diversity programs.”
Ellen Huang, SAG-AFTRA’s director of EEO & Diversity noted numerous diversity programs her union has undertaken, and Thom Davis, 2nd international vice president of the IATSE, said that his union has taken steps to be “more inclusive and diverse as we can possibly be.”
Dr. Stacy Smith, director of the Media, Diversity and Social Change Initiative at the USC, Annenberg School of Communications and Journalism, said that “it’s clear that there’s an inclusion crisis in the film industry,” and said that “a unique tax credit” that offers incentives to hiring women and minorities behind the camera is “one way to address this impediment.” But the real solution, she said, is to hire more women and minorities as directors and in key jobs behind the camera.
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