Legislation to extend California's film and television tax credit program by an additional five years cleared a major hurdle on Tuesday.
The bill, introduced by Assemblyman Felipe Fuentes, was approved by the the state Assembly Arts and Entertainment Committee by a vote of 8 to 0.
One member, Assemblyman Jim Silva, abstained.
"By any measure, the program so far has been a tremendous success and should be extended an additional 5 years," Fuentes said in a statement. "With the state's unemployment rate hovering around 12 percent, we need this incentive to help keep hundreds of thousands of Californians employed."
Backers of the bill say it will help encourage film and television productions to remain in the state by ensuring that the roughly $100 million in tax credits do not have to be approved on an annual basis.
They claim that states like New York are at an advantage when it comes to attracting filmmakers because they have a multi-year incentive program. In 2010, the New York State Assembly approved a bill that approved $420 million annually in credits for five years.
The California legislation still faces a number of obstacles before it gets approved. The bill moves on to the Assembly Committee on Revenue and Taxation on May 7.
If it gets approved, it will then have to get the backing of the Assembly Committee on Appropriations before it receives a vote on the assembly floor.
If it passes the assembly, Gov. Jerry Brown will have to sign it into law.
Roughly 40 states currently offer some form of tax incentives to entice film and television productions.
Critics argue that these incentive programs rarely have the positive economic impact that states hope. They maintain that states often pay out more in tax incentives than they get back from the production jobs that are created.
That may not be the case in California, which despite facing a threat of runaway production, remains the center of the film and television industry.
As for the efficacy of the credits on keeping production in-state, last year in Los Angeles on-location production rose 4.2 percent, according to non-profit permitting body FilmL.A.
However, the organization warned that those gains might turn to losses without a sweeter incentive program.