X

DO NOT USE

Roll Camera

While many cities and states offer special incentives such as tax breaks to lure  film and television production to their locale, Georgia claims to now offer the best deal around. Gov. Sonny Perdue recently signed into law the 2008 Entertainment Industry Investment Act. The new legislation is designed to encourage entertainment industry productions in the Peach State.

While Georgia passed a similar bill in 2005, the new act differs in that it offers more competitive incentives, Thompson says. The new provisions will replace those currently in use by offering a 20% tax credit for qualified productions, which are then eligible for an additional 10% tax credit if they include an animated Georgia promotional logo within the finished product.

These incentives apply to qualified films, TV series, commercials, music videos, and video games. Bill Thompson, deputy commissioner of the Georgia Film, Music, & Digital Entertainment Office, points out that the state will be the most competitive state in the country for video game productions. In fact, Georgia is one of a handful of states whose entertainment incentives support the video game industry.

In 2007, entertainment segments generated $413 million in Georgia. In all, the total economic impact of entertainment productions from 2005 to 2007 was more than $1.17 billion, due in large part to Georgia’s entertainment incentives, Thompson says.

L.A.-based film producer Erika Conner, who was co-producer for Idlewild, says such incentives would make her consider Georgia as a production locale. “Georgia’s new ’08 act certainly makes me rethink shooting in the state of Georgia. I’m ready to get started,” says Conner, whose next project in development is based on the Iceberg Slim novel Mama Black Widow and will feature Mos Def, Rihanna, and Kerry Washington.

Many African American producers have already set up shop in Georgia, including Tyler Perry.

“Governor Perdue has made it comfortable for us producers to reconsider the Peach,” Conner says.

Georgia has been investing in the entertainment industry for more than 35 years. In 1973, it formed the Georgia Film Commission, and since then 575-plus feature films, independent movies, television series and pilots, and TV movies were filmed in the state, contributing more than $5 billion to the state’s economy.

Georgia isn’t the only state on the minds of Hollywood producers. The Big Apple also offers special tax production credits. New York, which recently drew The Tyra Banks Show and Ugly Betty, has expanded its tax credits for film production. Also, New Mexico, Massachusetts, Connecticut, Rhode Island, Louisiana, North Carolina, Illinois, and Hawaii feature some form of tax breaks.

While Georgia wants to attract a diverse range of filmmakers to the state, Conner believes the new tax incentives will attract filmmakers of color. “It’s important for [African Americans in production] to take advantage of this new [bill] as our budgets are always on a budget. Therefore a tax break only works in our favor,” she says. “And so many actors and production crews are happy to work in Georgia, as they feel it’s not in the boondocks when on location for months. I’m excited and
ready to shoot in Georgia.”

Thompson agrees that filmmakers of color would be attracted to the deal. “Atlanta, especially, has been a leader in this area over the decades, helping support and foster the careers of filmmakers like Spike Lee (40 Acres & A Mule Filmworks Inc.), Will Packer and Rob Hardy (Rainforest Films, Stomp the Yard), Tyler Perry (the Madea series, House of Payne), Dallas Austin (ATL, Drumline) and many more,” he says.

“Georgia’s new entertainment incentives will create new opportunities for all filmmakers and generate a significant increase in the amount of productions within the state,” he adds. “We also expect to see more startup film, television, and video game companies, growth and expansion of existing companies, and other companies looking to relocate to Georgia due, in part, to the new incentives package.”

The Georgia Film, Music & Digital Entertainment office is busy getting the word out to clients in Hollywood and elsewhere. “We make several trips to California each year, meet with clients and prospects at an annual trade show, utilize e-mail, direct mail, advertising, and phone calls to keep our clients abreast of any new developments in Georgia,” Thompson says.

Something must be working. Georgia has already been dubbed by industry insiders as “Hollywood South.”

EST STATE DEALS FOR FILMMAKERS

CONNECTICUT
As of 2006, the Connecticut General Assembly established a tax credit program to encourage the production of digital media and motion pictures in the state. Eligible production companies can receive a tax credit of up to 30% of qualified digital media and motion picture production, pre-production, and post production expenses incurred.

HAWAII
The state offers a 15%-20% motion picture, digital media, and film production income tax credit. This is a refundable tax credit based on a production company’s Hawaii expenditures while producing a qualified film, television, commercial, or digital media project. The credit equals 15% of qualified production costs incurred on Oahu, and 20% on neighbor islands including Big Island, Kauai, Lanai, Maui, and Molokai.

ILLINOIS
The state’s tax credit consists of 20% of Illinois production spending for a taxable year and a 20% credit on Illinois salaries up to $100,000 per worker. The tax credit eligibility is $50,000 in Illinois production spend for a project 29 minutes or less in length, and $100,000 in spend for a project more than 30 minutes long. Qualified Illinois production spending includes tangible personal property and services purchased from Illinois vendors and compensation paid to Illinois resident employees (up to a maximum of $100,000 for a single employee).

MASSACHUSETTS
Studios, major producers, and filmmakers who shoot at least half of their movie or spend at least half of their production budget in the Commonwealth, are eligible for a tax credit equal to 25% of total spend. This includes salaries over $1 million. There are No caps. No limits. No pre-authorization. No pre-certification. Beginning with the start of pre-production and continuing for a period of 12 months, filmmakers will be eligible for 100% sales tax exemption on any production related items purchased in the state. Massachusetts is also the only state in the country that allows filmmakers to take their credits either as a direct rebate at 90% of the face value (guaranteed), or to sell them at market rate-whichever is more favorable. With the spending threshold lowered to $50,000 and with “digital media projects” now eligible.

NEW JERSEY
In 2006, New Jersey sweetened the pot by adding a major component to its incentive package: a 20% tax credit for productions that spend at least 60% of their budget for goods and services (exclusive of post-productions costs) used in the state. Moreover, certain tangible property used during film and television products may be exempt from New Jersey’s 7% sales tax. Such items may include car rentals, certain props, supplies to build sets, and repairs for lighting and camera equipment.

NEW MEXICO
The state offers a 25% tax rebate on all direct production expenditures, including New Mexico labor, that are subject to taxation by the State of New Mexico. The rebate is a refund on the full amount of the expenditure, not just the tax portion. (i.e., if the expense of an item including tax is $100, the rebate is $25). There is no cap or sunset clause, and there is no minimum spend required. The rebate applies to feature films, television, regional, and national commercials, documentaries, video games, and post-production. Actors from out-of-state also qualify, though under a separate tax structure. Requirements for 25% tax rebate include the prohibition of a script that is obscene in nature. Also, the film must contain an acknowledgment that the production was filmed in the State of New Mexico.

NEW YORK
As of April, New York State and New York City now offer film production tax credit programs, which combined can provide qualifying film and television productions a fully refundable tax credit equal to up to 35% of production expenditures. For a feature film or television project to be eligible, the production must shoot on a set, on a stage, at a qualified production facility in New York State. These productions will qualify for up to a 30% state tax credit for the work done at the facility. If the facility is within New York City, these productions will also qualify for the additional 5% tax credit from the New York City program.

Show comments