California ‘Has Started to Reverse’ Runaway Production, State Senate Leader Says

Senior Editor

State Senate President Pro Tem Kevin de Leon said Friday that California’s overhauled film and TV tax credit is reversing the flight of production from the state.

Speaking on the Paramount Studios lot to the Hollywood Chamber of Commerce, de Leon, a Democrat, cited the 11 TV series awarded credits in the first round of selection under the expanded program. Among them were four series relocating to the state, including HBO’s “Veep.”

“The film tax credit is working, and it will maintain our status as the entertainment capital of the world,” said de Leon.

Last year, state lawmakers more than tripled the size of the credit to $330 million annually, and shifted the selection process from a lottery to a ratio based on wages paid to workers.

De Leon said that the series getting the credit will provide $216 million in wages for crew members and $524 million in direct spending.

The state’s 20% tax credit is not as generous as say, Georgia’s, at 30%, but de Leon said that a lure for studios and producers is the ability to keep their workforce close to home. “We are actually reuniting families so they don’t have to go elsewhere to make a living,” he said, adding that “children want to see their mothers, they want to see their fathers on a daily fashion.”

California does offer some sweeteners, like an extra 5 percent credit for series that relocate or movies that do visual effects work in the state.

California has seen the flight of big-budget movies and one-hour dramas to other states like Georgia and Louisiana, as well as other countries anxious to boost employment and tourism. De Leon, the leader in negotiating the final agreement with Gov. Jerry Brown to expand the tax credit, declared, “We have started to reverse that trend here in the state in 2015.”

“Once again, we are showing the world that there is no better place for film as well as television production than right here in California, and in Hollywood, California specifically,” he told the crowd.

His speech was billed as a “state of the state speech,” and he addressed other topics, like the revitalization of Hollywood proper, education funding and climate change.

He also addressed concerns that the entertainment industry is lagging when it comes to hiring women and minorities, pointing out that such demographics will be making up an increasing share of the marketplace.

“It is incumbent upon us to recognize this responsibility and fight for better inclusion of women and minorities in the business and on the screen,” he said. “This will be good for your bottom line in the end because, quite frankly, they will be your audience more and more.”

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