Hollywood’s SOS: FilmLA Urges California to Expand Tax Credits Amid Production Crisis
Hollywood is sending an SOS to Sacramento. Recent data reveals a dramatic 19.7% decline in filming activity in the Los Angeles area from 2022 to 2023. This sharp downturn highlights a worrying trend, with California’s share of the global production market shrinking from 22% to 18%. FilmLA, the quasi-public agency that handles film permits in Los Angeles, is urging the state Government to expand its movie and TV tax credit program, warning that without broader measures, filming in the city has become too expensive. Location rentals, materials, and worker salaries are suffocating the local industry, which fears losing its role as the global hub for entertainment.
FilmLA President Paul Audley’s press note emphasized the need for “more support for California’s film industry” and called for a “vast expansion of the California Film & Television Tax Credit Program.” Currently, California allocates $330 million annually to fund TV and movie production. New York recently doubled its tax incentive to $700 million, and other major competitors like Ontario, Georgia, and the U.K. don’t place caps on their subsidies.
This has led to a seismic shift in the financial landscape, with studios increasingly moving productions out of California in search of better tax benefits. Colleen Bell, executive director of the California Film Commission, shared with the Los Angeles Times that the state “can’t always compete dollar-for-dollar with other tax credit programs” but she emphasized that it “must capitalize on its established infrastructure and skilled workforce to stay competitive”.
“California’s film incentive is a proven jobs creator that studies show provides a net positive return on every allocated dollar. What the program lacks is funding and eligibility criteria that reflect the outputs of the industry in 2024”, states Audley.
The entertainment industry contributes approximately $43 billion in wages to California’s economy. The Golden State needs it to be healthy to keep shining. “How long can we subsist — or help businesses and families thrive — on an ever-thinner slice of a shrinking production pie?” Audley asks in his statement. To paraphrase an old adage in global politics: when Hollywood sneezes, California catches a cold.
Source: LA Times
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Hollywood is sending an SOS to Sacramento. Recent data reveals a dramatic 19.7% decline in filming activity in the Los Angeles area from 2022 to 2023. This sharp downturn highlights a worrying trend, with California’s share of the global production market shrinking from 22% to 18%. FilmLA, the quasi-public agency that handles film permits in Los Angeles, is urging the state Government to expand its movie and TV tax credit program, warning that without broader measures, filming in the city has become too expensive. Location rentals, materials, and worker salaries are suffocating the local industry, which fears losing its role as the global hub for entertainment.
FilmLA President Paul Audley’s press note emphasized the need for “more support for California’s film industry” and called for a “vast expansion of the California Film & Television Tax Credit Program.” Currently, California allocates $330 million annually to fund TV and movie production. New York recently doubled its tax incentive to $700 million, and other major competitors like Ontario, Georgia, and the U.K. don’t place caps on their subsidies.
This has led to a seismic shift in the financial landscape, with studios increasingly moving productions out of California in search of better tax benefits. Colleen Bell, executive director of the California Film Commission, shared with the Los Angeles Times that the state “can’t always compete dollar-for-dollar with other tax credit programs” but she emphasized that it “must capitalize on its established infrastructure and skilled workforce to stay competitive”.
“California’s film incentive is a proven jobs creator that studies show provides a net positive return on every allocated dollar. What the program lacks is funding and eligibility criteria that reflect the outputs of the industry in 2024”, states Audley.
The entertainment industry contributes approximately $43 billion in wages to California’s economy. The Golden State needs it to be healthy to keep shining. “How long can we subsist — or help businesses and families thrive — on an ever-thinner slice of a shrinking production pie?” Audley asks in his statement. To paraphrase an old adage in global politics: when Hollywood sneezes, California catches a cold.
Source: LA Times
Share:
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