Includes writer's salaries and fees within production costs eligible for the empire state film production credit.
TITLE OF BILL: An act to amend the tax law, in relation to eligibility for the empire state film production credit
PURPOSE: Includes writer salaries and fees within production costs eligible for the empire state film production credit.
SUMMARY OF PROVISIONS:
Section 1. provides for the allowance of credit.
Section 2. Modifies the definition of "qualified production costs" to include writer's fees and services. Defines "writer" for purposes of the Empire State Film Production Credit.
Section 3. Outlines criteria to qualify as eligible production costs including requirements for writer residency, and a cap of 550,000 per writer on the amount of the credit that may be claimed by a qualified taxpayer where that writer is a minority group member or a woman. Places a cap of 55 million of the Empire State Film Production that may be used for writers.
Section 4. This bill shall take effect one hundred twentieth day after it shall have become a law.
JUSTIFICATION: Many films and television shows are drawn to the unique urban and picturesque landscapes of New York. The Empire State Film Production Credit has created jobs and brought revenue to New York when productions move to or begin in New York and take advantage of the 30% tax credit on qualifying production costs. However, it has not created employment opportunities for the thousands of New York State residents who try to earn their living by writing for television and film.
In 2008, there were 15 major television productions filming in New York State. Collectively, these shows employed a total of 122 writers. Of these 122 writers only 24 of them live in New York. The remaining writers reside on the West Coast, many in Los Angeles. Some of these writers work on scripts for shows such as Ugly Betty and Law & Order: Special Victims Unit, where the City of New York is a main character, without even visiting New York prior to writing an episode. At the same time, many New Yorkers have found it impossible to maintain a career writing for television without leaving the state, uprooting their families and depriving the state of tax revenue.
Currently, the Empire State Film Credit does not include writers as a qualified production cost, while Connecticut and Michigan do include writers in their film production tax credits. Canada, the biggest competitor for film and television productions, includes writers in their tax credit as well. Including writers as a qualified production cost will create jobs for New Yorkers as well as preserving New York's strong tradition as a creative center for entertainment.
The inclusion of writers as a qualified production cost would create new jobs and revenue with little fiscal impact. Funds for the Empire State Film Production Tax Credit are already allocated; this bill
would carve out a small amount of those funds and devote them to writers.
LEGISLATIVE HISTORY: New bill.
FISCAL IMPLICATIONS: This bill makes use of funds already allocated to the Empire Film Tax Credit. No additional allocation of funds is required.
EFFECTIVE DATE: This act shall take effect one hundred twentieth day after it shall have become a law and shall apply to the tax year in which it takes effect and all subsequent years.
STATE OF NEW YORK ________________________________________________________________________ 5370 2013-2014 Regular Sessions IN SENATE May 16, 2013 ___________Introduced by Sen. HANNON -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Govern- ment Operations AN ACT to amend the tax law, in relation to eligibility for the empire state film production credit THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraph 1 of subdivision (a) of section 24 of the tax law, as amended by section 3 of part Q of chapter 57 of the laws of 2010, is amended to read as follows: (1) Allowance of credit. A taxpayer which is a qualified film production company, or a qualified independent film production company, or which is a sole proprietor of or a member of a partnership which is a qualified film production company or a qualified independent film production company, and which is subject to tax under articles nine-A or twenty-two of this chapter, shall be allowed a credit against such tax, pursuant to the provisions referenced in subdivision
[(c)](E) of this section, to be computed as [hereinafter]provided IN THIS SECTION. S 2. Paragraph 2 of subdivision (b) of section 24 of the tax law, as added by section 1 of part P of chapter 60 of the laws of 2004, is amended and a new paragraph 9 is added to read as follows: (2) "Production costs" means any costs for tangible property used and services performed directly and predominantly in the production (includ- ing pre-production and post production) of a qualified film. "Production costs" shall not include [(i) costs for a story, script or scenario to be used for a qualified film and (ii)]wages or salaries or other compensation for writers, directors, including music directors, producers and performers (other than background actors with no scripted lines). WRITERS' FEES AND SALARIES SHALL BE ELIGIBLE PRODUCTION COSTS SUBJECT TO THE PROVISIONS OF SUBDIVISION (C) OF THIS SECTION; PROVIDED, HOWEVER, THAT FEES THAT ARE BASED ON DEFERRED, LEVERAGED OR PROFITEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD10927-01-3 S. 5370 2
PARTICIPATION COSTS, OR ARE IN EXCESS OF THOSE OTHERWISE PERMITTED BY SUBDIVISION (C) OF THIS SECTION SHALL NOT BE ELIGIBLE PRODUCTION COSTS. "Production costs" generally include technical and crew production costs, such as expenditures for film production facilities, or any part thereof, props, makeup, wardrobe, film processing, camera, sound record- ing, set construction, lighting, shooting, editing and meals. (9) "WRITER" MEANS A WRITER EMPLOYED OR RETAINED TO WRITE OR REVISE SCRIPTS, SCREENPLAYS, TELEPLAYS, DIALOGUE, SKETCHES, ROUTINES OR NARRATIONS. S 3. Subdivisions (c), (d) and (e) of section 24 of the tax law are relettered subdivisions (e), (f) and (g), respectively and two new subdivisions (c) and (d) are added to read as follows: (C) FOR A FEATURE FILM OR TELEVISION PRODUCTION, WRITERS' FEES AND SALARIES SHALL BE ELIGIBLE COSTS; PROVIDED, HOWEVER, SUCH COSTS SHALL NOT EXCEED FIFTY THOUSAND DOLLARS IN FEES OR SALARY PER WRITER PER QUAL- IFIED FILM AND PROVIDED THAT SUCH WRITER IS A MINORITY GROUP MEMBER, AS DEFINED BY SUBDIVISION EIGHT OF SECTION THREE HUNDRED TEN OF THE EXECU- TIVE LAW, OR A WOMAN. PROVIDED, FURTHER, THAT, NOTWITHSTANDING ANY OTHER PROVISION OF THIS SECTION, A WRITER'S FEES AND SALARY SHALL BE ELIGIBLE FOR THE MAXIMUM AMOUNT OF THE CREDIT GRANTED BY THIS SUBDIVISION, IF SUCH WRITER IS A RESIDENT OF THIS STATE. (D) FOR EACH TAX YEAR, NOT MORE THAN FIVE MILLION DOLLARS IN TAX CRED- ITS FOR WRITERS' FEES AND SALARIES SHALL BE GRANTED PURSUANT TO THIS SECTION. SUCH CREDITS SHALL ONLY BE AVAILABLE FROM CREDITS ALLOWED FOR PRODUCTION COSTS PURSUANT TO THIS SECTION. S 4. This act shall take effect on the one hundred twentieth day after it shall have become a law and shall apply to the tax year in which it takes effect and all subsequent tax years.