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League-Supported Film Tax Credit Bill Passes First Assembly Committee

March 28, 2014
The Assembly Arts, Entertainment, Sports, Tourism and Internet Media Committee heard AB 1839 (Gatto) earlier this week and unanimously approved by a 7–0 vote.
Long considered the pre-eminent location for television and film production, California’s golden reputation as the entertainment capital of the world has faced increasing competition and mounting pressures from out-of-state interests who have successfully lured some production companies away to other states by offering lucrative tax incentives currently not available in California. To combat this trend and increase the state’s industry competitiveness, recently introduced legislation would expand and extend the California Film and Television Production Incentive Program
Authored by Assembly Member Mike Gatto (D-Los Angeles), AB 1839 extends the California Film Commission incentive program by five years, lifts the per-film budget tax credit limitation so that larger films may qualify, and offers new incentives to specific film and television production activities. The League supports AB 1839 given the beneficial impacts it will have on local economic activities throughout the state.
Extending current incentives and providing new opportunities will result in billions of additional revenues for local governments statewide. According to a study commissioned by the Southern California Association of Governments, each dollar of tax credit issued under the program results in the following economic benefits:
  • Total economic activity increases by $19.12;
  • Labor income increases by $7.15; and
  • $1.11 is returned to local and state governments.
For more information on AB 1839, please see the League’s support letter.

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