California Legislators Approve $750M Funding For Film & TV Tax Credit Program

The news that Tinseltown has been waiting to hear has finally come: California lawmakers have approved Gov. Gavin Newsom‘s proposal to allocate $750M annually to the Film & TV Tax Credit Program.

Deadline understands that a formal vote will be held Friday on the trailer bill to make it official.

The Legislature has continued to negotiate on the state’s final budget ahead of the July 1 start to the fiscal year, despite holding a formal vote on June 15, to address about a $12B deficit. After lawmakers had removed language regarding the specific funding amount from its bills to amend the program, there were some questions about whether the full $750M would make it into the final budget.

However, this funding has been one of Newsom’s top priorities since he proposed it in October. In recent weeks, filmmakers had been traveling to Sacramento to plead their case to lawmakers. The trip, organized by producer Scott Budnick, included Patty Jenkins, Cord Jefferson and Jonathan Nolan.

In addition to the increased funding, the Legislature is working on a companion bill meant to improve the program and make it more accessible. In addition to expanding the qualification parameters, the bills propose increasing the available credit amount for an individual project from 20% to 35% for amounts paid or incurred in Los Angeles, also giving the California Film Commission leeway to allow for additional credit percentages by 5% in other areas of economic opportunity.

The legislation comes amid the latest spurt of runaway production as other states ramp up their film and TV tax incentives programs in an effort to lure production away from California. New York last month passed a state budget that includes expanded incentives.

The film and television community, particularly in Los Angeles, has been sounding the alarm on runaway production for many years. Newsom’s October proposal came as calls for action increased amid the global production contraction. Calls which were only made louder by January’s devastating wildfires in Los Angeles.

Amid this budget debate, the California Film Commission awarded $96M in tax incentives to 40+ films on Monday. Perhaps reflecting the changing finances and current geographical realities of the industry, 43 of those 48 projects are independent films, with many working with budgets of $10M or less.