California’s economy might see a boost from the state’s expanded film tax credits, but local lawmakers say it’s not enough.
Despite Gov. Gavin Newsom authorizing a $750-million film and TV tax credit program last summer, the impending merger between Paramount and Warner Bros., and the projected budget cuts that are expected to follow, has reignited fears about Hollywood jobs and U.S.-based productions.
“State programs cannot simply substitute for the kind of global, federal and competitive tax incentives that are needed to bring production back to American soil and stop its offshoring,” U.S. Sen. Adam Schiff (D-Calif.) saidduring a news conference Friday morning.
“We must act, and the urgency could not be greater,” he said. He revealed he is working on a bipartisan federal film incentive proposal that would be competitive with what other countries are offering for film productions.
He said the program isn’t about Hollywood’s stars; it’s about the jobs that productions create, including roles for set designers, carpenters and lighting crews.
“These are the people who make that magic happen. We want to keep those jobs here, and many of us are deeply concerned about what this potential merger will do to those jobs,” Schiff said.
Earlier this week, the California Film Commission revealed that 16 shows had recently received tax credits for filming in the state. The projects represent $871 million in qualified in-state spending and are expected to generate $1.3 billion in economic activity in California. Schiff said the state tax credit has generated more than $29.1 billion in motion picture production wages and supported more than 220,000 jobs.
Even as shows start to see gains in Southern California, Los Angeles film activity was still down 13.2% from July through September when compared with the same period in 2024. The downward trend extends the loss of 42,000 jobs in L.A. between 2022 and 2024, the continued suffering of local sound stages and the offshoring of productions internationally.
“Federal policymakers must act to level the playing field and make the U.S. film and television industry more competitive on the global stage,” said Matthew Loeb, the president of the International Alliance of Theatrical Stage Employees. “A globally competitive labor-based and tax incentive is. For us, production that supplements state incentives is essential to return and maintain film and television jobs in America.”
HBO Max’s medical drama “The Pitt” is filmed at one of Warner Bros. soundstages in Burbank and it’s one of the shows benefiting from California’s tax incentive.
Noah Wyle, the star and executive producer of the show, said during the news conference that “it’s really hard to shoot a TV show in Los Angeles, and it’s really expensive, prohibitively” — so adopting an economic model that allows productions to take full advantage of the California tax incentive was essential to “The Pitt” filming in L.A.
“As an Angeleno with generational roots to this city and as a seasoned member of its creative community, advocacy for Los Angeles-based production is something that is very close to my heart,” Wyle said.
“‘The Pitt’ has blessedly become proof of that speculative concept. I’m happy to report we’ll commence shooting season three this summer, and that a rising tide has indeed lifted all boats in season one under the 3.0 tax program,” he added.
The show received a 20% tax rebate on many above-the-line costs. The budget for one episode was approximately $6.6 million, so the show received a rebate of about $760,000 per episode. By the end of season one, the production was able to save over $11 million. Wyle estimated that the first season of “The Pitt” contributed around $125 million toward California’s gross domestic product.
Rep. Laura Friedman (D-Glendale), who is working with Schiff on production tax incentives, said that because California is already seeing benefits from the current program, there’s no reason it wouldn’t work nationally. Friedman added that tax incentives are a common practice among many industries in the U.S.
“Hollywood is not asking for special treatment. Whether it is computer chips, the energy sector or pharmaceuticals, this is something that is standard in the United States,” said Friedman. “In terms of our nation, Hollywood and its ability to tell the story of America, it is something worth saving.”
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