Post Strike: Los Angeles Film Tax Credits Could Be On The Way

Actor Simu Liu joins other striking writers and actors walking with pickets outside Culver Studios in Culver City, Calif. on Wednesday, Aug. 2, 2023. (Ringo Chiu/Shutterstock)

Actor Simu Liu joins other striking writers and actors walking with pickets outside Culver Studios in Culver City, Calif. on Wednesday, Aug. 2, 2023. (Ringo Chiu/Shutterstock)

In a bid to rejuvenate the local film, TV, and digital production sector post-strike, the Los Angeles County Board of Supervisors is actively exploring a range of financial incentives. Supervisors Katheryn Barger and Lindsey Horvath have spearheaded a motion, unanimously passed with a 5-0 vote, to identify strategies that could incentivize ongoing and new productions in the county.

The motion directs the County Department of Economic Opportunity, in consultation with FilmLA, to engage an economic development firm for studying various strategies. The proposed mechanisms under consideration are extensive and aimed at making the region more attractive for filming, especially on County property.

Key Takeaways:

  • The motion proposes a variety of financial incentives including:
    • Incentive packages to attract foreign investment in film production.
    • Payroll and sales tax reductions for productions in unincorporated areas.
    • Tax reductions or deferments for production facility capital development projects.
    • A "creative economy evergreen capital development fund" for emerging entertainment technologies like virtual reality and artificial intelligence.
    • Reductions in regulatory and zoning barriers for building production facilities.
    • A fee waiver program for lower impact and/or student productions in unincorporated areas.
    • A plan to leverage vacant underutilized County properties for shared production space.
  • The motion emphasizes the importance of the entertainment industry to the Los Angeles County economy and aims to ensure the region remains attractive for filming.
  • County agencies are directed to advocate for enhancing the California Film Tax Credit program, remove fee and permit requirements for production scout visits to County property, and engage with studios and unions to encourage young and diverse populations to learn more about and land jobs in the industry.
  • The 2023 Otis Report on the Creative Economy highlighted the local entertainment sector's significant contribution, with approximately one million jobs, $114 billion in labor income, and $38 billion in tax revenue.
  • Revenue lost due to the strikes, estimated between $3 to $4 billion if the strike lasts 100 days, is cited as a motivating factor for the motion.
  • California Gov. Gavin Newsom last week estimated the economic impact of the strikes at more than $5 billion.

The motion comes at a critical time when the entertainment industry is grappling with the repercussions of prolonged strikes. The L.A. Economic Development Corporation report highlighted the significant revenue loss due to the strikes, which has propelled the supervisors to act swiftly.

Supervisor Barger stressed the need to support the entertainment industry as the strikes reach their resolutions. The motion is also aimed at ensuring that L.A. County continues to be a desirable destination for filming and discourages film and television shoots from moving out of the county due to cost or bureaucratic hurdles.

Supervisor Horvath echoed Barger's sentiments, emphasizing the need for competitive local incentives and continued investment to keep film, TV, and commercial productions thriving in L.A. County. The supervisors' proposal underscores the critical role the entertainment industry plays in the local economy and the urgent need to restore it to its former glory post-strike.

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