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MPAA’s Chris Dodd Calls for California to Expand Tax Credits to Lure Big Budget Blockbusters

Speaking on Friday to a San Fernando Valley business group, MPAA chairman Chris Dodd called for an expansion of California’s production tax incentive program to include big-budget films, noting that the state has lost out to others on projects like the sequels to “Man of Steel” and “The Amazing Spider-Man.”

California’s incentive program, adopted in 2009, provides $100 million per year for film and TV productions, but movies with budgets above $75 million are not eligible. The intent was to prevent only a handful of movies from depleting the annual outlay, but Dodd said that the result has been a dearth of big-budget tentpoles shooting in the Los Angeles region.

It should be no surprise, then, that “11 of this year’s 12 biggest blockbusters were filmed in states like Louisiana and New Mexico instead of California,” Dodd said, according to his prepared remarks to the Valley Industry and Commerce Assn. “And this trend is only going to continue.”

“The Amazing Spider-Man 2” shot in New York, and the sequel to “Man of Steel” will shoot in Michigan, he noted.

The MPAA actually advocates for incentives nationwide, and the industry’s lobbying org, in seeking congressional support, has often promoted the fact that so many states benefit from production jobs.

Dodd said his “job at the Motion Picture Association is to advocate on behalf of my studios, not the locations of their productions, but I know the studios I represent would prefer, everything else being equal, to make their films and television programs here in California, for many reasons.”

He warned that with other states offering incentives, “It does not take long for those states and countries to attract and train talented local people to do the work that historically could only be found here and a few other places.”

Dodd also called for a California incentive program that will make it possible for long-term productions, like TV series, to budget well into the future. The state program was renewed last year until 2015, even after advocates called for a longer-term extension.

Critics of incentive programs have called it a “race to the bottom” and have challenged some claims of job growth when productions shoot at a location. And while Los Angeles Mayor Eric Garcetti has put runaway production on his priority list, with a plan to lobby state lawmakers to expand the California program, he will have to convince them to do so against many competing interests.

Critics of expanding the incentives, however, have questioned the urgency given that NBCUniversal, Disney and Paramount each have plans to expand their production facilities in Southern California. Indeed, Dodd said that the “film industry is not suddenly folding its tent and moving elsewhere.” He said that the expansion plans indicate that the industry “is betting on California’s future as well.” But he said that “more needs to be done to keep this industry from slowly slipping away.”

Dodd also called on Google to do more to fight piracy, citing a study funded by the entertainment industry showing that 74% of consumers surveyed cited using search engines to discover or navigate to infringing sites in their initial effort to download a movie or TV show.

“These search engines have the ability to stop directing audiences to sites with illegitimate content, and I am still hopeful that we can work with them in the coming days to find ways to make this happen,” Dodd said.

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