Tapped-out California tax credit leads to a halt in the growth for productions in L.A.
After benefiting from an influx of cash courtesy of then-Governor Arnold Schwarzenegger, Los Angeles filming productions have grown stagnant, barely breaking even with the same period last year, non-profit organization FilmL.A.announced on Tuesday.
According to FilmL.A. — which helps productions secure filming permits — on-location filming in Los Angeles in the second quarter of 2011 grew a mere 1.1 percent compared to the same period last year, when it showed a 16 percent climb compared to the second quarter of 2009.
Worse, production on commercials and television shows was down slightly compared to the same period last year.
Overall, permitted production days (PPD) in the commercials category fell 7.5 percent from the second quarter of 2010, slipping from 1,604 PPD to 1,484. The category began to slip last quarter after a 21-month surge.
In the television category, PPDs slipped 0.7 percent in the second quarter of 2011 compared to Q2 last year, dropping from 4,052 to 4,024. Sitcoms and reality series took particularly bad hits, falling 29.4 percent and 12.9 percent, respectively. (The good news? TV dramas were up 26.6 percent, while pilots were up 4.5 percent.)
Feature production grew a modest 4 percent, with 1,604 permit production days versus 1,542.
What's to blame for the stagnation? According to FlimL.A., after benefiting from the California Film and Television Tax Credit Program, which last year doubled its $100 million annual allocation to encourage filming in Los Angeles, found itself tapped out in January, and is in danger due to California's budget crisis.
There's currently a petition being circulated to gain additional funds for the tax credits, as well as extend them beyond their current 2014 expiration date.
FilmL.A. says that, in the most recent quarter, only five feature films benefiting from the tax credits filmed in Los Angeles for a total of 117 PPD, compared to the second quarter of 2010, when 16 productions benefiting from the breaks filmed for a total of 423 permitted production days.
According to a study released last month, the California Film and Television Tax Credit Program has generated $3.8 billion in economic activity in Los Angeles since its 2009 inception, and has created more than 20,000 jobs.
FilmL.A. president Paul Audley predicted that the effect of the diminished tax credits will have a particularly distressing effect on the television front in coming months.
“We expect to see Features get a boost as a new crop of incentivized projects hits the streets,” Audley noted. “Unfortunately, the momentum we carried in television may be gone. A lot of the new shows you’ll see this fall won’t be filming in California. As a result, we’re expecting a lackluster second half of the year for TV.”