Texas to increase funding to state film incentive program by $300 million

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A bill increasing the amount of money the state spends to attract film and television productions to Texas has been sent to Gov. Greg Abbott after lawmakers agreed to lower what had originally been proposed at the start of the year.

Senate Bill 22, filed by Houston Republican Sen. Joan Huffman, would allow the comptroller to deposit $300 million into a new Texas Moving Image Industry Incentive Fund every two years until 2035. The Senate's version of the bill would have deposited $500 million every two years until 2035. However, the House amended this version of the bill to lower it to $300 million, which was accepted 23 to 8 by the Senate.

Currently, the state provides $200 million every two years for film incentives, funding for which has been subject to change every legislative session. SB 22 would not only increase the amount of money, but also make the funding consistent.

Eligible expenses that could be paid for by incentives would include Texas workers’ wages, meals purchased from local restaurants, and airfare on Texas-based airlines.

The Senate also agreed with the House's proposals to allow productions that use historical sites and those that partner with a university or other higher educational institution to qualify for additional incentives.

Last month, Rep. Todd Hunter, R-Corpus Christi, who presented the bill in the lower chamber, introduced a proposal to lower the amount at the suggestion of the budget committee.

Chase Musslewhite, co-founder of Media for Texas, a non-profit organization dedicated to boosting the state's film and media industry, said she had heard discussions about decreasing the $500 million amount. Still, as long as the bill provides more than $200 million, she said her organization is content.

“This bill makes us competitive with our neighbors so that we wouldn’t be losing our stories to New Mexico, Louisiana, and Georgia, but it wouldn’t make us competitive enough to open the floodgates,” said Musslewhite. “About six or seven other states still offer more or have stronger incentives, and I think that works perfectly for Texas. We’re not trying to have everybody come here and join the rat race to get more incentives. We just want to be baseline competitive.”

This bill has been the subject of commentary and discussion for several weeks now. Critics have been alarmed at the amount of money that would be given to productions and the potential political and local impact Hollywood might have on Texas.

“This bill provides taxpayer-funded incentives to the film and entertainment industry. The same industry that trashed us for supporting President Trump, mocked us for standing up for the unborn, and ridiculed our Christian faith at every opportunity,” said Rep. David Lowe, R-North Richland Hills, who spoke against the bill. “Now we are expected to trust them to produce family-friendly content and reimburse them $2.5 billion over the next decade. Let's stop the Hollywood handouts.”

Others have raised concerns about how the governor's office will determine which productions to fund. The bill gives the governor's office complete discretion over which projects receive grant funding. However, supporters pointed out that many of these provisions have already been in place, and the bill doesn’t stop films from being made; it just provides extra incentives.

According to the National Conference of State Legislatures, Texas is one of 37 states to offer a film incentive program. However, due to the uncertainty surrounding their incentive program, Texas is far behind states like New York, Georgia, and New Mexico when it comes to Westerns and other film and TV productions.

“There are tons of Texans who live in California and New York, all over the globe, who are pursuing their careers, because those opportunities weren’t here in Texas,” said Grant Wood, co-founder of Media for Texas. “We have essentially been subsidizing the workforce of these other states. It’s all about bringing that workforce home and continuing to create a more robust and diverse economy.”

Since 2007, lawmakers have funded the film incentive program at varying levels, with $50 million during one legislative session followed by $45 million the next. A then-historic $200 million came during the most recent session in 2023.

The program has boosted economic activity in Texas, producing a 469% return on investment, according to the Texas Film Commission, though economists and some House lawmakers have criticized that metric and denounced film incentives as wasteful spending.

The bill has received support from actors like Matthew McConaughey, Woody Harrelson and Dennis Quaid, and creators like Chad Gunderson, who produces the show “The Chosen,” and Taylor Sheridan, who wrote the movie Hell or High Water.

“I think with the celebrity power we have behind this, once this bill gets passed, it will spread like wildfire,” Musslewhite said, mentioning 10 productions are already interested in shooting in Texas.

In addition to pumping more money into film incentives, SB 22 would make smaller films eligible for larger grants. Currently, projects that spend between $1 million and $3.5 million in Texas are eligible for a 10% rebate, and projects that pay more than $3.5 million can receive a 20% grant. The bill proposes a larger, 25% grant for feature films and television programs that spend at least $1.5 million.

Texas’ film incentive program offers an additional 2.5% incentive to productions shot in certain “underutilized” or “economically distressed areas,” as well as to those with veterans who make up 5% of the total paid crew.

One of the biggest fears expressed by Republican lawmakers about the bill is the amount of influence it would give Hollywood executives over Texans. Fears about them booking stadiums or parks, closing down roads or streets, and taking up other resources are unfounded, Musslewhite said.

“I have always found this fear interesting because I think it doesn’t give enough credit to how Texans operate, how strong we are in our sensibilities, who we are, and how we do business,” Musslewhite said. “Instead of fearing what Hollywood will do to Texas, we should be enthusiastic about what Texas will implement on the industry.”

Disclosure: National Conference of State Legislatures (NCSL) has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

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