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In an interview on The Wrap, Amy Lemisch, director of the California Film Commission, talks about the program that creates a $100 million production tax credit for each of the next five years.
Why was this program really necessary?
Over 40 states offer some kind of financial incentive for production. We hadn’t. Canada had been the biggest threat to us for years, but now it’s also New York, New Mexico, Louisiana and other states. From 2003 through last year, I saw a 50 percent drop in the number of productions in California.
What about actors, directors, producers — are they part of this deal?
No. Our bill does not include above-the-line people.
Does the program cover all new productions?
No. It’s very specific. It provides a 20 percent tax credit for what they call a “qualified motion picture,” which means feature films with a production budget of up to $75 million; made-for-television movies with a minimum budget of $500,000 and any new series for basic cable with a minimum budget of $1 million. It also provides a 25 percent tax credit for a TV series that returns to California, like “Ugly Betty.”
Anybody else benefit for this?
Independent films with a budget under $10 million can get a 25 percent credit, and if the company has no California tax liability, it can sell the credit to anybody who wants to buy it, then apply the money to its production budget as a way to cut down costs. They need the money.
We’re not just talking L.A., here?
Oh, no. The whole state. We have offices all over. We’re hoping every county benefits. Like, why shouldn’t westerns be shot here the way they used to be. And San Francisco. They’re really hurting. This could really help San Francisco.
Anybody against it?
We had bi-partisan support and bi-partisan opposition. This is a huge state with lots of agendas. Here in LA, we tend to have tunnel vision.
So who opposed it?
Well, let’s say if you’re from Humboldt County, this has very little meaning to you.
The budget deal was just passed. What has been the reaction in the entertainment industry to the production credit?
People are now doing production budgets for California. Before, they’d do a budget for Louisiana and one for New Mexico and see which one made financial sense for them. Now they’re doing one for Louisiana and one for California. My phone hasn’t stopped ringing since the bill was passed.
How will the credits be granted, assuming companies properly quality?
First come, first served.
Gov. Arnold Schwarzenegger signed the California state budget this morning and in that budget was a $100 million tax incentive designed to keep the film industry in LA (and other parts of the state).
Will it work? We won’t know till 2011.
Wait…isn’t that almost two years from now? Why, yes it is. And there’s no way to know if there will even be any money in the budget by then.
We were just thrown a bone. And it’ll take two years to see if we can actually get a taste.
This is awesome news! For Canadians.
Not only is production here in California dwindling to a screeching halt (Thanks Gov. Schwarzenegger for doing nothing about keeping productions here in CA!) but now that the Canadian dollar is down the toilet, producers are heading back to Hollywood North.
Canadian currency is tumbling in value versus the U.S. dollar, and that is a decidedly good thing for firms hoping to lure film and TV projects north of the border, local industry executives say.
A strengthened Canadian dollar since 2006 forced many U.S. producers to steer their projects away from Canada — dubbed Hollywood North during the go-go 1990s — to southern U.S. states with their own generous tax credits.
Canada’s appeal was undercut even further in 2008 when New York tripled its tax credit on below-the-line expenses to 30% and began to offer TV series and movies filmed in New York City a 5% bonus.
That move effectively knocked Hollywood production hubs such as Toronto and Montreal out of the running when it came to luring Los Angeles producers away from rival locales like Michigan, Louisiana and New Mexico.
But with recent market turmoil sending the loonie down in value, Canada is back on the radar of Hollywood bean counters, Bronfman said.
“If you do the math, with the (Canadian) dollar below 80 cents, that’s a 20% bonus. Combine that with our federal and provincial tax credits, and we’re back to a level playing field with New York State,” he said.