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in Filmmaking
on Apr 1, 2007

The folks at Axium, one of the leading film payroll companies, recently sent an email updating its mailing list of changes and new developments in the various state film rebate programs. With their kind permission, here it is:

COLORADO is planning to again fund its incentive, originally called the “Defense against Canada Act.” Details will be available soon.

FLORIDA’s legislature is evauating proposed major changes to its incentives, which will switch from a rebate to a transferable credit of 15% or 20%, with $75 million available over the next three years. Details to follow.

IDAHO is considering a bill which will grant a rebate equal to 20% of qualified in-state spend. The maximum incentive that any individual production can receive is $500,000. There is also a statewide cap of $1,000,000. To qualify, 20% of the crew must be Idaho residents. Star salaries, producer and director salaries, script costs, and any indirect costs will not qualify.

INDIANA’s legislature is now considering a bill that would provide a 25% tax credit for productions in the state.

MICHIGAN offers a new cash incentive (rebate) on a sliding scale for film, television and commercials. The in-state spending threshold is $200,000. From $200,000-$1 million, a 12% refund; $1 mil-$5 mil, a 16% refund; $5 mil-$10 mil, a 20% refund. Cast and crew must be residents to qualify; only in-state purchases qualify for the rebate. The film office has $7 million to rebate annually for the next 4 years.

MISSISSIPPI’s new incentive bill has been signed by the governor. The legislation provides a tiered rebate of 20-30% of in-state production spend and an additional 10% rebate for out-of-state cast and crew whose wages are subject to MS withholding tax and whose salary is less than $1M. The MS tiered rebate is calculated as 20% of the first $1M of local spend, 25% of the next $4M of local spend and 30% of local spend over $5M. There is no minimum spend, but there is a $5M cap per project. TV series can reapply after reaching the cap figure.

The motion picture production hiring credit against the corporate income tax has been repealed.

NEW MEXICO is considering a 5% bump in the rebate for department heads, if at least 75% of the crew are NM residents. Except for talent, only New Mexico residents qualify for the rebate. The new Albuquerque Studios is now operational; four stages are ready now, with two more planned for later this year. The remaining two stages will be ready in 2008.

The Royal Bank of Scotland is interested in providing bank guarantees for the New Mexico production loan, using pre-sales as collateral. For information contact John Swain at the RBS London office – john.swain@rbs.co.uk.

SOUTH CAROLINA has eliminated the pass-through companies, which allowed producers to create an entity which could order certain classes of equipment and supplies from out-of-state, and qualify them for the incentive. The state now has a list of some items that may be ordered directly from out-of-state and still qualify for the rebate. New funds, estimated at $40 million, will available for the rebate starting July 1, 2007. Applications will be accepted starting in April.

TENNESSEE still has $10 million dollars available for their T-Grant. They are working on an incentives program, which will be announced soon. The new film commissioner is Perry Gibson.

UTAH has increased the allocation for its incentive to $4 million.

WASHINGTON has just passed new incentives legislation – a 20% rebate for in-state expenditures, including labor (state residents only). The rebate is for features, television and commercials, with a $1 million cap per production; $6 million is available for 2007. Minimum spends to qualify are $500,000 for features, $300,000 for television, and $250,000 for commercials.

WISCONSIN had hoped to offer a revised incentives plan which would move up the effective date from its current 1/1/2008, but the bill has stalled in the legislature. Included in the proposed revision is the ability to use cast and crew from out-of-state, and to order supplies from out-of-state vendors for goods and services that are not available locally.

WYOMING has enacted its “Film Industry Financial Incentive” program, which provides a cash rebate of up to 15% of qualified in-state production costs including salaries and employment benefits of residents, goods purchased or leased, and rents or leases for real or personal property.

To qualify the production company must spend a minimum of $500,000 of total qualified expenses in the state and then meet additional criteria to determine the rebate percentages (between 12% – 15%.) Expenses for pre-production, production, post-production and digital media effects services rendered in the state qualify. The annual cap for the program is $1 million (all still available). Although the program is effective immediately, rebates will not be available until July 1, 2007 when the program is funded.

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