Gov. Blagojevich proposes new film and television production tax credit to continue the industry's Illinois revival

Vital new legislation will help attract more movie and television productions, jobs, and revenue to Illinois         

[FEB. 18, 2006]  CHICAGO -- Gov. Rod R. Blagojevich announced Wednesday an innovative effort to continue the growth of the Illinois television and film industry.

In 2003, film production had declined to approximately $26 million as studios looked for less expensive locations, both across the nation and around the world. This meant that thousands of Illinois-based cast and crew members were largely without work within their professions. A film tax credit passed by the General Assembly and signed by the governor turned these fortunes around over the past two years by making Illinois productions even more attractive.

By 2004, productions generated an estimated $77 million and led to almost 15,000 people being hired by the industry. In 2005, production revenue increased to an estimated $94 million, which led to approximately 15,000 people being hired by various film and television projects.

But this business has become even more competitive over the past several years, which is why the governor is proposing new legislation that will continue the flow of film and television projects into Illinois. State Sen. Rickey Hendon, D-Chicago, and state Rep. Ken Dunkin, D-Chicago, will sponsor the new legislation.

"The film industry is expanding again in Illinois and bringing countless studios to capture our beautiful locations and neighborhoods," Blagojevich said. "Thanks to our film tax credit, these productions are also injecting millions of dollars into our state's economy and putting thousands of people to work. But we aren't resting on our laurels. By providing this additional support, we are ensuring that Illinois will continue to be a prime production location and the Hollywood of the Midwest."

The primary change in the tax credit would be to make it a 20 percent credit on total Illinois production spending rather than on Illinois film production wages. Illinois production spending would be defined as all salary and expense costs associated with production activities taking place within the state. This can include salaries, spending with local vendors and lodging. Labor costs incorporated into Illinois production spending would be capped at $100,000 per individual. Expenses tied to activities taking place outside Illinois or related to travel into or out of the state (i.e., airline tickets) would not be covered.

"Governor Blagojevich and I believe that we must work aggressively here in Illinois to remain one of the top locations for all kinds of movie and television projects," said Hendon, who will sponsor the legislation in the Senate. "This new legislation will ensure that even more projects will be filmed in our state, which means more revenue and more Illinois jobs."

"During these challenging fiscal times, we must continue to take advantage of all of our assets that promote economic growth," said Dunkin, who will sponsor the legislation in the House. "Illinois has proven that we have what it takes to compete for all kinds of movie and television productions, but Governor. Blagojevich and I know that we must tailor our financial support to meet the changing needs of this important industry."

The revised tax credit will also be effective for multiple years rather than carrying an annual renewal requirement. To qualify, minimum Illinois film and television production spending would have to be greater than $100,000 and minimum Illinois commercial production spending would have to be greater than $50,000. The proposal would also continue encouraging the hiring of Illinois residents from economically disadvantaged areas.

The current tax credit for Illinois film production provides a 25 percent credit on wages paid by a production company to each employee who is an Illinois resident. The credit is limited to the first $25,000 in wages.

"By working together, we have proven that Illinois has everything it needs to bring all kinds of movie and television productions back to Chicago and across the state," said Vans Stevenson, senior vice president for state government affairs for the Motion Picture Association of America. "Governor Blagojevich's support for expanding and extending the tax credit is vital to attracting more location production here and to our studios' continued success."

"This new legislation will be another important boost for Illinois film and television production," said Eileen Willenborg, Illinois Production Alliance president and AFTRA/SAG-Chicago executive director. "We appreciate Governor Blagojevich's strong leadership, and we will continue the partnerships that have been so successful over the last several years."

Over the past year, a cross section of Hollywood studios have delivered the production and filming of tomorrow's big screen hits to the state, including "Il Mare," "The Break-Up" and "Stranger than Fiction." Already, the critically acclaimed television series "Prison Break," the state's first dramatic television series in six years, has captivated audiences nationwide with the cinematic delight of Illinois-based film production, while stimulating the economy and employing thousands of workers.

Productions in 2005 include "Prison Break," by FOX Television; "Il Mare," Warner Bros.; "Stranger Than Fiction," Mandate Pictures; "The Break-Up," Universal Pictures; "Drunk Boat," Magnificent Mile Productions; and "You Are Going to Prison," Prison Pictures. Theater marquees have also been lit up with a variety of other recent movies filmed in Illinois, including "The Weather Man," "Ice Harvest," "Ocean's 12," "Batman Begins," "Derailed" and "Roll Bounce."

"Film and television production helps spur economic development and job creation in Illinois, and Governor Blagojevich knows that we must keep this industry strong to continue hearing 'lights, cameras and action' in our state," said Jack Lavin, director of the Illinois Department of Commerce and Economic Opportunity. "These three simple but important words put thousands of people to work both in front of the camera and behind the scenes. We need this new legislation to continue making this a reality."

"Governor Blagojevich has been clear in his directive that we need to reach out to Hollywood studios and bring more business back to Illinois," said Brenda Sexton, managing director of the Illinois Film Office. "We've had great success over the past two years, but there is much more potential for growth as studios see the incredible results of films produced in our state. This revised tax credit is a critical step in the right direction."

[News release]

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