California's 35% Post-Production Tax Credit Nears a Senate Vote, Still Without Funding

California is close to adding a 35% tax credit for post-production work, with a bill racing toward a state Senate floor vote before the legislative session closes. No money is budgeted to fund it, according to Deadline.

• A 35% credit for post work. AB 2319 would cover VFX, scoring, mixing and more, aimed at pulling post-production back to California.
• Around $35 million in year one. The first-year allocation is now envisioned near $35 million, down from an initial target of up to $100 million.
• No funding secured. Even if the bill passes, the $352 billion state budget sets aside nothing for the credit.
• August 31 is the hard deadline. The legislative session ends then, and final amendments must sit "in print" for 72 hours before a Senate floor vote.
• A separate cap threatens existing credits. SB 122's $5 million cap on business and corporate tax credits, already signed into law, could gut California's $750 million annual film and TV incentive.

AB 2319 targets VFX, scoring, and mixing with a 35% incentive

The bill would add the credit to the incentive program administered by the California Film Commission, with backers pitching it as a way to move post-production jobs back to the state. Assemblyman Nick Schultz, a primary sponsor alongside Sen. Ben Allen, framed the stakes bluntly.

"We're literally in the period of speak now and forever hold your peace," Schultz said.

If amendments land on schedule, the bill sits in print for 72 hours, then heads to a Senate floor vote that Deadline reports has the votes to pass. We covered California's slide to #6 and the forces pulling work elsewhere.

A near-final fix for the SB 122 cap collapsed

SB 122, already signed into law, caps business and corporate tax credits over $5 million and has drawn pushback from Hollywood unions and CAA's Bryan Lourd. A deal to carve out independent and some studio and streamer productions looked done, with the MPA circulating talking points to stakeholders, before Assemblymember Rick Chavez Zbur's office was told leadership was taking a "different approach," according to Deadline.

Zbur said he is still pushing against the August 31 deadline. "I'm optimistic that we are very close to reaching a solution that helps address the impact of SB 122 on California's Film and Television Jobs Program," he said. We broke down the broader fight over tax incentives as production has left Los Angeles, where roughly 50,000 film and TV jobs have been lost over four years.

The credit could pass with no money behind it

Even if AB 2319 clears the Senate, funding is the open question. The Senate Appropriations Committee voted in favor of a standalone post-production credit, as Deadline reports, but the state budget has nothing allocated for it. Editors Guild Local 700 president F. Hudson Miller tied the two efforts together.

"We need to make sure that AB 2319 is passed and also that it is fully funded," Miller said, adding that the guild is also calling on lawmakers to defend the existing Film and TV Tax Credit Program 4.0 from the new caps.

Schultz said the alternative to partial funding is starting from zero in the next budget cycle. Whatever reaches Gov. Gavin Newsom's desk must be signed or vetoed by September 30.