Legislation to extend California’s tax credit production incentive program for two years has cleared two hurdles in State Senate committees.
The Senate Governance and Finance committee and the Appropriations committee both approved Assembly Bill 2026, authored by Felipe Fuentes (D.-Sylmar), on Wednesday morning in unanimous votes. The legislation now heads to the full Senate for a vote by Friday, when the legislature’s session ends.
Similar Senate legislation, authored by Sen. Ron Calderon (D-Montebello), cleared the Senate earlier this month and is due to be heard Thursday by the Assembly’s Revenue and Taxation committee.
It’s not yet clear which bill will be the final legislation submitted to Gov. Jerry Brown.
The 3-year-old program is strongly endorsed by the film business as a sensible method to create below-the-line jobs by giving producers incentives to lense in the Golden State. Currently, California provides $100 million in annual tax credits for productions, but the 25% credit is smaller than many other programs, and demand far exceeds supply, with 28 projects selected by lottery out of more than 330 in the most recent round in June.
The current funding for the program provides for a final $100 million in tax credits to be announced next June. Both the Fuentes and Calderon have been amended to provide for a two-year extension rather than a five-year term.
Fuentes carried a bill last year that saw the state Senate opt for a one-year extension rather than the five-year extension originally planned. Program backers have asserted that the one-year extension, as opposed to a multiyear program, has created a lack of certainty among producers deciding whether to shoot in California.