New York Increases Film and Television Subsidy Cap

News Summary

New York Governor Kathy Hochul has signed a state budget doubling the film and television subsidy cap to $800 million, including a new $100 million specifically for independent productions. The budget revisions aim to streamline tax credits, attract more productions, and rejuvenate the local economy, despite a recent decline in applications for the tax credit. This move positions New York competitively against other states and reinforces its role as a prime destination for filmmakers.

New York Governor Kathy Hochul has signed a state budget that increases the film and television subsidy cap to $800 million, nearly double the amount from last year. This expansion includes a new pool of $100 million specifically allocated for independent productions, indicating a strategic move to bolster New York’s competitiveness in the film and television industry.

The revised budget not only increases funding but also enhances the payout available for production companies that frequently shoot in the state. This initiative aims to address long-standing concerns regarding delays in receiving tax credits and restrictions on eligible above-the-line costs for rebates. The changes are expected to inject vitality into a sector that has been experiencing a decline in activity, projected at a 15% decrease since 2019.

Key changes included in the budget revisions are accelerated recovery of credits, allowing productions to claim credits in the allocation year and lowering eligibility requirements for visual effects and animation-only subsidies. In addition, there are provisions for an extra 10% incentive for music scoring costs when five or more musicians are hired locally. These adjustments are designed to streamline the process for filmmakers and animation studios, making New York a more attractive location for production.

Further to these enhancements, production entities applying for two or more projects in New York with eligible spending of $100 million or more can benefit from a 10% increase in their tax credit until the year 2028, providing a significant incentive to keep large-scale projects in the state. Television shows will also be eligible for this bonus until they are canceled, allowing for sustained financial support over time.

Qualifying productions can now access total incentives up to 40%, aligning New York with the most generous state incentives offered nationally. The incentive program will run through 2036, allowing substantial funding allocations based on production budgets: $20 million for projects with budgets under $10 million and $80 million for those over $10 million. This shift is expected to attract a broader array of productions and ultimately bolster the local economy.

One notable change is the elimination of the previous $500,000 cap on above-the-line costs. While total payouts will remain limited to 40% of below-the-line costs, this removal is anticipated to encourage more diverse and high-budget productions to consider New York as their filming location.

California is also making strides in increasing its film and TV tax incentive cap from $330 million to $750 million, reflecting a nationwide trend toward enhanced support for the entertainment industry. This includes exploring a base credit increase to 35%. Moreover, discussions are in the works for a federal tax incentive that could further augment state subsidies, although details remain unfinalized.

Despite the increase in funding and benefits, applications for the New York tax credit have fallen by 53% compared to five years ago. This decline in applications signals challenges still faced within the industry, highlighting the competitive landscape of film and television production, which also includes rival states like New Jersey, offering incentives up to 39% of production costs.

The Motion Picture Association has endorsed these recent changes, characterizing them as a significant expansion that should provide a much-needed boost to local economies and support job creation in the region. With the revised film and TV incentive program, New York aims to reclaim its reputation as a premier destination for filmmakers and content creators alike, fostering growth and innovation in the production sector well into the future.

Deeper Dive: News & Info About This Topic

• Deadline: New York Film & TV Production Incentives
• New York Times: Tariffs and Film Insights
• Times Union: Rethink on Tax Incentives in New York
• Wikipedia: Film Tax Incentive
• Crain’s New York: Keep Film Industry Tax Incentives
• Google Search: New York Film Tax Incentives