Here’s how Arizona film incentives could attract filmmakers
From daring Westerns with scenes of cacti and gunslingers, to dew-laden vines of a tropical jungle – movies featuring those thrills could all be filmed in Arizona in the near future thanks to the return of Arizona film incentives.
Gov. Doug Ducey signed H.B. 2156 into law in July 2022, allowing for a $125 million dollar tax incentive program for film studios that want to shoot and produce films in Arizona. The law targets large projects and feature-length pictures.
According to the law’s text, the first year disburses $75 million, $100 the next year, and then $125 million each year after that. The law is expected to go into effect late 2023.
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“Hollywood is really excited about the tax incentive,” Stephen Nebgen, entertainment attorney and president of the Arizona Film and Digital Media Coalition said. The AFDMC is Arizona’s leading film industry lobbying organization.
The law provides budgets under $10 million with a 15% tax credit, between $10 and $35 million with 17.5%, and over $35 million with 20%, according to Nebgen.
There are also additional 2.5% tax credit incentives for using Arizona facilities and crew, having post-production done in Arizona, and the length of the project. A film may potentially qualify for a total of 30% tax credit permitting that the qualifications are met. However, qualification benchmarks (such as how much crew must be composed of Arizonans) haven’t been defined yet, Nebgen said.
There was an old tax incentive program that became law in 2005 and expired in 2010, but the major difference between this new law and that one is that more infrastructure requirements are in this current law. Production is directed to use facilities that are 10,000 square feet or larger, according to Nebgen.
“Right now, there are no great sound stages or studio systems to shoot any movies or TV shows,” Jason Carney, Executive Director of the Phoenix Film Foundation, said. Among the spaces used for film production, they’re mainly for filming commercials and smaller projects, according to Carney.
Because of the infrastructure requirements, it’s not exactly like starting over if the law were to someday expire like the last one, Carney said.
“I think we would be better off than we are now. In a way (we would be) back where we started, but at least then there’d be studios built,” Carney said.
Several studios are already planned to be built. In July 2022, not even a month after Gov. Ducey signed the bill into law, Acacia Filmed Entertainment decided to build two new film studios. Groundbreaking is supposed to start in early 2023, according to Carney.
There are doubts as to whether or not the tax incentive, while perhaps beneficial to those who do decide to film in Arizona, will actually lure people to film in the state.
“Would I expect a lot of films to be made here? It’s up for grabs because a lot of other states already have a head start. Arizona is really far behind in that regard,” Kaely Monahan, audio producer for the Arizona Republic and film critic, said.
Several other states have enacted tax credits long before Arizona. In fact, while moviemaking has long been associated with California, Georgia is one of the highest film producing states in the country, in part because of their own tax incentive programs. In fiscal year 2022 alone, the film industry spent $4.4 billion in Georgia, according to the Georgia Department of Economic Development.
“I’m hedging my bets because (growth) remains to be seen. It’s a slow process,” Monahan said.
According to the Arizona Commerce Authority, more than 5,000 films and TV shows have been filmed in Arizona since 1913.