CAST & CREW ENTERTAINMENT SERVICES
WEDNESDAY, JULY 22, 2015

In this Issue Backtotop
ENACTED
LEGISLATION 
QUICK LINKS

Tool
ENACTED LEGISLATION
Signed by the Governor
LOUISIANA (H 604)LAH604
On July 1, 2015, Governor Jindal signed House Bill 604 which amends the existing film incentive program as follows:
  • Establishes an expense verification report procedure for the motion picture investor tax credit with the following requirements:
    • The Department of Economic Development will directly engage and assign an independent certified public accountant or tax attorney to prepare an expenditure verification report;
    • The fee is based upon either an hourly rate not to exceed $225 for contract services, or the pro rata cost of salary and benefits for a department-employed CPA;
    • The expense verification report fee is the responsibility of the applicant seeking certification of tax credits and shall not exceed $15,000 for a project with qualifying production expenditures between $300,000 and $25 million, and $25,000 for a project with qualified production expenses over $25 million; and,
    • The applicant seeking certification shall be required to submit an up-front deposit of the expense verification report fee.  The up-front deposit for an application with qualified production expenditures between $300,000 and $25 million will be $7,500 and $15,000 for an application over $25 million in qualified production expenditures.
These provisions shall apply to all applications or submissions for certification or issuance of tax credits submitted to the department on or after January 1, 2016.

LOUISIANA (H 678)LAH678
On July 1, 2015, Governor Jindal signed House Bill 678 which amends the existing film incentive program as follows:
  • Reduces the tax credit from 30% to 25% of the base investment if a qualified production does not include a Louisiana promotional graphic or an alternative marketing opportunity.
This provision shall be applicable to productions receiving initial certification on or after August 1, 2015.  
 
LOUISIANA (H 735)LAH735
On July 1, 2015, Governor Jindal signed House Bill 735 which amends the existing film incentive program as follows:
  • Requires any payments made to an individual, loan out company, personal services company, or other entity to be subject to withholding at the highest individual rate of 6%, or the highest individual rate in effect at the time;
  • Defines payroll as all salary, wages, and other compensation of any kind, including but not limited to services, benefits, housing, box rentals, and any other type of benefit paid, provided or rendered to an individual that is taxable and for which taxes are withheld and remitted to the Department of Revenue;
  • Requires annual reporting which contains the following information:
    • Name, address, and taxpayer identification number of the loan out company or other entity;
    • Identification of tax type: C Corporation, S Corporation, or Limited Liability Company with tax type specified;
    • Name, address, and social security number of the payee;
    • The ownership structure of loan out company or other entity;
    • An estimate of the amount the loan out company or other entity will pay the payee; and,
    • An affirmative statement of whether or not the payee is a related party to the loan out company or other entity, and if so, provision of an affidavit stating under penalty of perjury that the transaction is valued at the same value that an unrelated party would value the same transaction.
These provisions shall be applicable to productions which receive initial certification on or after January 1, 2016.   
 

LOUISIANA (H 773)LAH773
On June 29, 2015, Governor Jindal signed House Bill 773 which amends the existing film incentive program as follows:
  • Establishes various fees associated with persons applying for financial incentives in Louisiana:
    • The fee for filing an application will be .5% of the amount of the incentive with a minimum of $500 and a maximum of $15,000.
This provision is effective July 1, 2015.  
 
LOUISIANA (S 98)LAS98
On July 1, 2015, Governor Jindal signed Senate Bill 98 which amends the existing film incentive program as follows:
  • Requires sellers of motion picture investor tax credits to be qualified by and registered with the Department of Revenue prior to selling or brokering tax credits:
    • Failure to qualify and register prior to brokering credits is punishable by a fine of not more than $10,000 or imprisonment at hard labor for not more than five years, or both.
This provision shall become effective on January 1, 2016.
 
MICHIGAN (H 4122) MIH4122
On July 9, 2015, Governor Snyder signed House Bill 4122 which amends and eliminates the film production incentive program as follows:
  • Prohibits the Michigan Film Office or the Michigan Strategic Fund from providing new or increasing funding effective July 9, 2015; and,
  • After all payments and obligations relating to previously approved projects have been satisfied, the money remaining in the Michigan film promotion fund shall revert back to the general fund after September 30, 2016.
OREGON (H 2171)Oregon

On July 20, 2015, Governor Brown signed House Bill 2171 which extended the film incentive program sunset date from December 31, 2017 to December 31, 2023.

 

SAN FRANCISCO, CA (110-15)SF

On July 2, 2015, Mayor Lee signed Ordinance 110-15 which amends the film incentive program as follows:

  • Extends the sunset date from June 30, 2015 to June 30, 2019; and,
  • Increases the funding cap from $3 million to $4 million for the life of the program and subject to annual appropriation.

 

 
PROPOSED LEGISLATION
Still in the House or Senate
NEW JERSEY (A 4673)NJA4673

Assembly Bill 4673 proposes to reestablish the recently expired production incentive program (as of June 30, 2015).  Highlights of the proposed program are as follows:

  • Creates a $30 million per fiscal year cap (July 1 - June 30);
    • At least one-third of the annual credit must be issued for projects based in counties with insufficient economic activity indicators;
  • Creates a refundable tax credit equal to 25% of below-the-line expenses;
    • Credit is allowable against the taxpayers liability for the second privilege period beginning after the qualified project commences;
  • Requires qualified projects to have an annual or seasonal budget of at least $1 million;
  • Requires at least fifty percent of qualified costs to be studio based;
  • Defines qualified projects as a nationally distributed film or nationally televised program with primary and fixed studios operating in New Jersey; and,
  • Allows the director to establish the order of priority of the application of the credit.
 
IN THE NEWS
  
Production Incentives
Joe Bessacini
Vice President, Film & TV Production Incentives
818-480-4427

Incentive Financing

Deirdre Owens
Vice President, Production Incentive Financing
818-972-3201

 

  

Cast & Crew Entertainment Services | www.castandcrew.com
 
ALBUQUERQUE   ATLANTA   BATON ROUGE   BURBANK   DETROIT   NEW ORLEANS   NEW YORK
WILMINGTON   LONDON   TORONTO   VANCOUVER