Film/TV Tax Credit Lures TV Series, Jobs to State

The next season of SHOWTIME’s “Penny Dreadful” will be relocating production to Los Angeles with help from the state’s film and television tax credit program—expanded by a California Chamber of Commerce job creator bill—according to the California Film Commission.

The film commission announced on March 11 that “Penny Dreadful” will bring high-wage jobs and lots of production spending to California as it moves from Dublin to Los Angeles for its fourth season, becoming the 16th TV series to relocate here with help from the state’s Film and TV Tax Credit Program 2.0.

The film commission said that “Penny Dreadful: City of Angels” will employ more than 350 cast members, 150 crew and 10,000 extras (including stand-ins measured in “man days”).

Approved conditionally for $24.7 million in tax credits, “Penny Dreadful” will spend an estimated $99 million on below-the-line wages and other qualified expenditures during the upcoming season. The film commission points out that overall spending for such projects is significantly higher than qualified spending, as overall spending also includes above-the-line wages and other production expenditures that do not qualify for tax credits under Program 2.0.

With the addition of “Penny Dreadful,” California’s expanded Film and TV Tax Credit Program 2.0 has attracted relocating TV series from seven U.S. states plus Canada and the Republic of Ireland, according to the film commission. These projects are on track to generate nearly $1 billion in qualified in-state spending, including $553 million in wages to below-the-line workers. These numbers will continue to grow as the relocated projects are picked up for additional seasons.

The commission notes that “qualified expenditures” are wages to below-the-line workers and payments for equipment/vendors. Overall in-state production spending will be significantly higher with the addition of above-the-line wages and other spending that do not qualify for California tax credits.

Due to the tax credit program’s ongoing success with long-term TV projects, the latest TV application period (held February 4–8, 2019) was open only to relocating series and recurring series already accepted into Program 2.0.

In addition to the relocating “Penny Dreadful: City of Angels” series, the tax credit program currently has 29 recurring TV series in various stages of production. To date, a total of 74 television projects, including new TV series, relocating TV series, pilots, movies of the week, and miniseries have been accepted into Program 2.0 since it was launched in July 2015.

The next application period for TV projects (the first for fiscal year five of Program 2.0) is scheduled for May 20–24, 2019. The next round of feature film projects (the third and final round for fiscal year four of Program 2.0) is scheduled to be announced April 1, 2019.

Film/TV Tax Credit Program

In September 2014, Governor Edmund G. Brown Jr. signed bipartisan legislation (CalChamber job creator AB 1839; Gatto; D-Los Angeles) to more than triple the size of California’s film and television production incentive, from $100 million to $330 million annually. The credits are aimed at retaining and attracting production jobs and economic activity across the state.

The California Film and TV Tax Credit Program 2.0 also extended eligibility to include a range of project types (big-budget feature films, TV pilots and 1-hour TV series for any distribution outlet) that were excluded from the state’s first-generation tax credit program.

Program 2.0 has a sunset date of July 1, 2020.

Program Extension

In June 2018, Governor Brown signed SB 871 (Committee on Budget and Fiscal Review), which extended California’s tax incentive for motion pictures and television productions for an additional five years. The extended program, dubbed Program 3.0, will enable the film commission to allocate $330 million per year from July 2010 through June 2025. The commission is developing regulations, program guidelines and other procedures to administer the extended tax credit program.

SB 871 included provisions from CalChamber-supported job creator bills AB 1734 (Calderon; D-Whittier) and SB 951 (Mitchell; D-Los Angeles). This tax incentive has proven effective in maintaining jobs in California and growing jobs in this industry.

More Information

More information about California’s Film and Television Tax Credit Program, including application procedures, eligibility and guidelines, is available at www.film.ca.gov/tax-credit.

Staff Contact: Sarah Boot

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Sarah Boot
Sarah R. Boot joined the CalChamber in March 2018 as a policy advocate specializing in privacy/technology, telecommunications, economic development, and taxation issues. Before joining CalChamber, Boot was a top adviser to now-Senate President Pro Tem Toni G. Atkins, serving as the senator’s legislative director and as lead staffer on legal, privacy, telecommunications, business, and technology issues, among many others. Boot also was principal consultant to Atkins during her time as Assembly Speaker and Speaker Emeritus. For three years, Boot was an assistant U.S. attorney in the Southern District of California. She prosecuted a broad array of federal crimes, including bank robbery, sex trafficking of minors, and narcotics trafficking. In private practice, Boot spent three years litigating complex civil and intellectual property litigation, primarily representing Internet and technology companies. Boot earned her J.D. from the University of Michigan Law School. She graduated from the University of Michigan with an honors degree in political science and a minor in Spanish