California's Film Industry Facing Challenges

As California grapples with a challenging landscape for its film and television industry, Governor Gavin Newsom is poised to unveil an ambitious plan that aims to double the state’s film and TV incentive program from $330 million to an impressive $750 million annually. This move is designed to provide much-needed tax relief for filmmakers who choose to shoot in the Golden State.

Formation of the California Production Coalition

In a bid to keep California as the heart of the entertainment industry, a new group known as the California Production Coalition has formed. This coalition, which includes over 30 businesses and organizations—from studio operators like Hudson Pacific Properties and Raleigh Studios to payroll providers like Entertainment Partners and Wrapbook—will lobby for robust support to retain Hollywood's glitz and glamour.

Public Support and Recent Successes

Their formation comes on the heels of a poll highlighting that Californians care deeply about sustaining the motion picture industry in Hollywood. This announcement coincides with the California Film Commission's success in luring the second season of Apple TV+'s *Bad Monkey* from Florida with an attractive $20 million in tax credits.

Coalition's Goals and Industry Impact

Charles Rivkin, head of the Motion Picture Association (MPA) which represents major players like Disney, Paramount, and Netflix, emphasized the collective goal of the coalition: "The MPA and its members are proud to stand with California businesses to highlight how our creative community can grow its meaningful contributions and build a stronger foundation for film and television production in the state."

The coalition has been formed in response to a significant outflow of Hollywood projects seeking better tax incentives elsewhere, both domestically and internationally. This trend has notably affected California, with overall production declining and impacting countless ancillary businesses including prop houses and studio service operators that form the backbone of the entertainment sector.

Production Trends and State Response

According to industry tracker ProdPro, global production volume in the third quarter of 2024 decreased by approximately 17 percent compared to 2022, with Los Angeles County specifically experiencing a 5 percent drop in production activity, marking it as the "weakest" quarter of the year according to FilmLA. This alarming data prompted Governor Newsom to visit Raleigh Studios to announce a proactive plan with Mayor Karen Bass to curb the ongoing production exodus. “Expanding this program will help keep production here at home, generate thousands of good-paying jobs, and strengthen the vital link between our communities and the state’s iconic film and TV industry,” Newsom asserted.

Support for Broader Tax Credits

Interestingly, the study commissioned by the California Production Coalition points to a wave of local support for enhanced tax credits not just for traditional film projects, but also for game shows, reality TV, and other programming genres. The petition for broader support comes in the wake of a staggering 56 percent year-over-year decline in reality TV production in L.A., as reported by FilmLA.

Voices from the Industry

Pam Elyea, owner of the equipment rental company History for Hire, expressed her concerns, stating, “We must not take California’s film industry for granted and expect to stay competitive in the global entertainment industry without a competitive tax credit program. Let’s give our California roots the fiscal nourishment to grow even stronger and larger.”

Kavon Elhami, CEO of Camtec Motion Picture Camera Systems, echoed the grave sentiments voiced by many in the industry, "Today, we are witnessing firsthand the challenges facing our industry as California’s dominance in entertainment is tested by other states and countries. It is essential that we come together now to ensure California remains the hub of the motion picture industry."

The Stakes Are High

As this coalition gears up to put pressure on policymakers, the stakes for California's entertainment future could not be higher—will they reclaim their position, or will the Golden State fade away in the race for production supremacy? Stay tuned as the drama unfolds!