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New York State Tax Credits Yield ‘Dora and Friends,’ Other Post-Production Gains

The debut on Monday of Nickelodeon’s “Dora and Friends: Into the City” is giving New York state officials reason to trumpet the state’s boosted incentives for post-production work.

While states offering tax credits for filmmaking usually have their sights set on drawing movies that will showcase their locales, there is an increasing battle to draw post-production work, particularly in music scoring, animation and visual effects, as other countries like Canada offer generous subsidies to win the business. In California, where musicians and visual effects artists have been particularly hurt by the flight of production, a coalition of studio and union officials are pushing for legislation to expand the state’s incentive program with provisions to retain certain types of post-production work.

New York’s Empire State Development cited “Dora” as spending $1 million in post-production costs, hiring 80 residents and generating $5 million in spending on local New York vendors.

In 2012, Gov. Andrew Cuomo signed legislation expanding the state’s tax credit for post-production from 10% to 30%, for work in the New York metro area, and from 10% to 35%, for work in upstate New York. The state also lowered the post-production threshold for visual effects and animation on qualified expenses from 75% to 20%, or $3 million of the total animation budget, whichever is lower.

“The new post-production incentive for animation was a key factor in our decision to keep post production in New York,” said Teri Weiss, executive vice president of original programming, Nickelodeon Preschool Television, in a statement. “We’re thrilled to be able to take advantage of all the talent and facilities here in the city, and very proud that ‘Dora and Friends’ supports the New York post production community.”

New York officials contend that the changes have helped draw films shot outside the state, with New York companies doing the post-production work. Since the changes were made to the program, 140 productions have applied for post-production work, more than eight times the number of applications they received during a two year period under the smaller tax credit. State officials also said that 13 post-production companies have established new operations.

The legislation pending in California, AB1839, includes a 25% tax credit on expenditures for visual effects, music scoring and music track recording. A group of visual effects artists, however, are preparing a legal effort to compel U.S. trade action against countries that offer subsidies to win such production work.

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