84 Percent of Projects Denied California Tax Credits Film Elsewhere

Runaway projects accounted for nearly $2 billion in spending outside the state, a new Film Commission report says

Eighty-four percent of the film and TV projects that have applied and failed to qualify for California’s severely over-subscribed tax credit program over the past four years have gone on to be made in other states and countries.

These projects accounted for nearly $2 billion in production spending outside California, according to the Film & TV Tax Credit Program Progress Report, released Wednesday by the California Film Commission. Among the projects that recently exited and filmed elsewhere are the feature films “Anchorman 2,” “Sex Tape” and “Million Dollar Arm,” and the TV series “Graceland.”

The vast majority of applicants for the tax credit program, which was instituted in 2009, are denied. In June, a record 497 projects applied via lottery and just 26 won conditional approval to share in the program, which disperses $100 million in incentives annually.

Also read: The $420 Million Question: How Much Will California Set Aside for TV, Film Tax Credits?

A bill that would extend and broaden the incentives — most likely providing a significant boost in the amount of money doled out — is currently working its way through the state legislature, and the new data should provide firepower for its advocates.

Including this year’s conditionally allocated tax credits, approximately $700 million in tax credits has been allocated for eligible projects, according to the report. This $700 million investment yielded $5.39 billion in direct spending by projects in-state, including an estimated $1.72 billion in below-the-line wages.