California Readies $1.65B Film/TV Tax Credit to Draw Productions From Anti-Abortion States

Gov. Gavin Newsom is backing legislation that will extend California’s film and television tax program for an additional five years through 2030. The announcement on Wednesday came in an intensifying bid to draw productions from states, like Georgia and Oklahoma, that have passed laws restricting abortion rights after the Supreme Court overturned Roe v. Wade.

The bill, if passed, will provide $1.65 billion or $330 million annually in tax credits to film, TV and other media productions beyond 2025, when the program was set to expire. Last year, Newsom signed off on adding $180 million in incentives over the next two years, which temporarily increased the annual amount in incentives to $420 million, thanks to a budget surplus. The expansion of the program included $150 million in tax credits to encourage soundstage construction.

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“As other states roll back people’s rights, California will continue to protect fundamental freedoms for all and welcome businesses that stand up for their employees,” Newsom said in a statement. “Extending this program will help ensure California’s world-renowned entertainment industry continues to drive economic growth with good jobs and a diverse, inclusive workforce.”

In an open letter to Hollywood, Newsom called on companies to stop doing business in states that have “waged a cruel assault on essential rights” in the wake of the Supreme Court’s decision. “Today more than ever, you have a responsibility to take stock of your values — and those of your employees — when doing business in those states,” he wrote.

Newsom emphasized that California shares the values of people working in the film industry. He continued, “So to those in power to make decision about where to film, where to hire, where to open new offices, we in California say: Walk the walk.”

There were widespread calls to boycott shooting in Georgia after it passed legislation in 2019 banning abortions after a fetal heartbeat is detected. Netflix, Disney, WarnerMedia, NBCUniversal, AMC, Sony, CBS and Viacom all threatened to pull projects from the state if the law went into effect. Bob Iger, former chief executive of Disney, said in response to the legislation that, “Many people who work for us will not want to work there, and we will have to heed their wishes in that regard.”

Despite a federal appeals court lifting an injunction against the law in July, talks of boycotting shooting in the state have quieted. Studios continue to film in Georgia but have pledged to cover costs for employees to travel out of state to obtain reproductive care.

Critics of calls to cease shooting in Georgia, including gubernatorial candidate Stacey Abrams, have argued that such action would most hurt people on the ground working on film and TV productions, the majority of whom opposed the legislation. There are nearly 100,000 people working in the film industry in Georgia.

The hesitation from studios to pull productions from certain states may also boil down to tax breaks. Of the 22 states that have banned, mostly banned or will likely ban abortions, 15 offer tax credits to Hollywood to incentivize in-state production. To the film industry, they offer nearly half a billion dollars every year in free money. Georgia alone handed out $1.2 billion in tax credits in 2021.

California Film Commission Executive Director Colleen Bell urged Hollywood to turn away states that offer such lucrative tax incentives but oppose reproductive rights. She noted that it’s ultimately “bad for business.”

“The media industry has significant influence when it comes to defining our culture and how people perceive the world,” she told The Hollywood Reporter. “As such, it has significant responsibility. The industry also has a long history when it comes to fighting for basic freedoms. Now is a defining moment to consider those freedoms when deciding where filming occurs. “

After the Supreme Court’s decision to overturn Roe v. Wade, Newsom signed legislation to protect patients and health care providers from civil liability for providing or receiving abortion care. He also issued an executive order that prevents any information, including medical records, from being shared by state agencies in response to investigations brought by other states to restrict abortion access. He included in the state budget more than $200 million in additional funding for reproductive health care.

In November, California voters will consider amending the state constitution to include the right to an abortion.

As productions have increasingly moved away from shooting in California to states that offer more tax credits, Newsom has set his eyes on getting some of them back. He signed legislation last year reserving an additional $15 million for series relocating to California, bringing the total annual funding for such shows to $71.1 million. Criteria to qualify as a relocating series was also relaxed to include projects that filmed their pilot episode out-of-state. (The program previously required relocating series to film an entire season outside of California.)

The state’s film and television tax program has generated $24 in economic activity for every $1 invested, helping create over 100,000 jobs, according to the governor’s office.

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