The $900 billion COVID stimulus bill includes several special provisions for the film and television industry, including an extension of a tax break for studios and production companies and billions for small theater chains.
Congress is poised to pass the measure on Monday night, along with a $1.4 trillion omnibus spending bill to keep the government running. The omnibus bill includes yet provision long sought by the film industry, a measure cracking down on streaming services that traffic in pirated content.
The theater industry has been lobbying hard for the Save Our Stages Act, a measure that will provide $15 billion in grants for live entertainment venues and theaters that have been hit hard by the pandemic. The grants are available to companies with 500 full-time equivalent employees or fewer. That works out to about 1,580 theater operators representing 3,500 locations, or about 60% of the total U.S. theater business. Sen. Chuck Schumer, who is closely allied with Broadway theaters, has been pushing for the measure for months.
The stimulus bill also includes a five-year extension of a tax deduction for film, TV and live theatrical productions. Under Section 181 of the tax code, productions are allowed to deduct up to $15 million of the cost of a production in the year it was incurred, rather than wait until the project is released. The provision was set to expire on Dec. 31, though it is typically extended year to year. The stimulus bill extends the tax break through the end of 2025, which will give studios greater certainty in planning productions.
The omnibus bill — which is intended to provide funding to keep the government operating — also includes the Protecting Lawful Streaming Act. The measure, from Sen. Thom Tillis, makes it a felony to operate a “digital transmission service” that primarily offers illegal streams of copyrighted content. Such conduct is already a misdemeanor, and the act brings the penalty in line with those for illegal downloads and trafficking in pirated physical media.
The Motion Picture Association and its offshoot, the Alliance for Creativity and Entertainment, have been pursuing operators of pirate streaming sites in civil court, sometimes obtaining substantial judgments and orders to shut down. But now they will have greater leverage to involve the FBI and federal prosecutors in such cases.
The measure marks the most significant advance for copyright holders since the failure nine years ago of the Stop Online Piracy Act, which ran into backlash from the tech community. In the years since, the major tech companies have lost some of their clout on Capitol Hill amid hot-button controversies over perceived censorship and disinformation.
Public Knowledge, a group that defends online consumer rights, had previously indicated it would not oppose the measure, noting that it was “narrowly tailored and avoids criminalizing users, who may do nothing more than click on a link or upload a file.” Tillis, the chair of the Senate Judiciary Subcommittee on Intellectual Property, is also working on a much broader and more ambitious reform of the Digital Millennium Copyright Act, which would make it easier for copyright holders to flag and take down pirated content.