Garcetti Calls for Expanding Hollywood Tax Credit - NBC Southern California

Garcetti Calls for Expanding Hollywood Tax Credit



    Los Angeles Mayor Eric Garcetti approached state officials Wednesday to lobby for a tax credit for film and TV studios. Conan Nolan reports for NBC4 News at 6 p.m. from Hollywood Wednesday, Aug. 13, 2014. (Published Wednesday, Aug. 13, 2014)

    Los Angeles Mayor Eric Garcetti was in Sacramento on Wednesday to lobby Gov. Jerry Brown to support a bill that would increase and extend a Hollywood tax credit aimed at keeping film and television production in California.

    Assemblymen Raul Bocanegra and Mike Gatto, both Democrats from Los Angeles, have proposed AB1839, which would extend the tax credit by five years and expand it to cover big-budget productions costing more than $75 million, among other changes. The current program provides up to $100 million a year in film tax credits and will expire in July 2017 if not renewed.

    Garcetti wants California to increase the annual $100 million tax credit to compete with New York, which offers $420 million a year in tax incentives. Connecticut, Michigan and Illinois also offer studios tax breaks.

    Any final amount needs approval from Brown, who is campaigning for re-election on his record of fiscal restraint and paying down debt.

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    Gatto hopes the bill will curb runaway feature film production, which has dropped by half in Los Angeles over the last two decades.

    “There’s lots of carpenters, lots of electricians, lots of people who work in restaurants and catering who are really, really hoping that this bill does pass,” Gatto said.

    Since 2009, the state has offered incentives to eligible film and tax productions to counter tax credits and grants offered by other states and countries trying to lure production out of California. Nationwide, almost half the industry's jobs are located in Los Angeles County, according to the Legislative Analyst's Office.

    The current program allows films with budgets between $1 million and $75 million and television movies with a minimum budget of $1 million to apply for a 20 percent tax credit. AB1839 would lift the cap so more expensive productions will be eligible for the tax credit, although only the first $100 million of those productions would be eligible to receive it, according to Gatto's staff.

    The current process for handing out tax credits for Hollywood productions is handled as a lottery because the demand is greater than the available money.

    The Associated Press contributed to this report.

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