California’s Expanded Production Tax Credit Draws 37 TV Applicants

California’s Expanded Production Tax Credit Draws 37 TV Applicants

from: Dave McNary, Variety.com

California’s sweetened film and TV tax credit program has drawn applications from 31 new TV projects and six current TV series seeking to relocate to the Golden State.

The first round of applications for the expanded program came in last week and was open only to projects scheduled to begin production on or after July 1. The eligibility for tax credits has been expanded to include new TV series for networks, premium cable outlets, pilots and projects for Internet-based distribution.

A total of $55.2 million was made available for four categories: new series, which drew 16 applicants; miniseries, which drew three; movies of the week, which drew four; and pilots, which drew eight. Another $27.6 million has been reserved for series relocating production to California from out-of-state.

“Our first application period for the new program was smooth and very well received by the industry,” said California Film Commission executive director Amy Lemisch. “Applicants responded positively to the new online application system, and our outreach to communicate how the application process works appears to have paid off.”

The 2015-16 fiscal year will mark a major expansion of the 6-year-old tax credit program, aimed at halting the erosion of California-based production to states with bigger incentives such as Georgia, Louisiana and New York. The annual allocation will rise from $100 million to $330 million, and applications will be ranked on how many jobs they will produce, rather than being selected by lottery.

The program expansion, enacted last year by California lawmakers, covers five years and $1.65 million in tax credits.

“Our new credit is making Hollywood competitive again with 37 applications — including 6 TV productions that want to relocate from outside California — all of which will employ hundreds of artisans,” said Los Angeles Mayor Eric Garcetti. “Hollywood wants to come home and now we have the tools in place to make it possible.”

California has already allocated about $90 million for returning TV programs along with $10 million for independent features in the fiscal year. The next application period for the new program is scheduled for July 13-25 and targets feature films, which will receive $48.3 million, and independent projects, which will receive $6.9 million.

Another $92 million will be allocated during the rest of fiscal 2015-16. The new program awards tax credits only after selected projects complete post-production, verify the creation of in-state jobs and provide all required documentation, including audited cost reports.

The legislation established the allocation to each category: 40% will go to new TV dramas, movies of the week, miniseries, and recurring TV series; 35% will got to features; 20% will go to relocating TV series; and 5% will go to independent features. The credit is set at 20% of production costs with an additional 5% “uplift” if producers shoot outside the Los Angeles zone, commit to music scoring or music track recording in state or to do visual effects in California.

Under the previous program, the lion’s share of funds went to continuing TV series. More than $77 million of the $100 million available for 2014-15 was allocated to a dozen series, led by $11.5 million for “Teen Wolf” (pictured above), “Rizzoli & Isles” with $8.9 million, “Pretty Little Liars” with $8.4 million and “Major Crimes” with $7.9 million.

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