(The Center Square) – The California Film Commission announced more TV shows, including a reboot of “Baywatch,” are getting the latest round of tax credits in an effort to spur production.
According to the commission’s press release issued Thursday, 17 TV projects are expected to bring in $902 million in in-state spending. That includes $487 million in wages for 5,165 cast and crew members and 35,946 background performers or “extras” over the course of 1,000 filming days statewide. This latest round of tax credits is expected to generate $1.2 billion economic activity statewide, bringing the total amount generated by the program to more than $2.5 billion from the last two rounds of tax credits.
The Film & Television Tax Credit Program was launched in 2009 to provide tax break incentives for Hollywood to spur production and create jobs. Gov. Gavin Newsom increased the amount of tax credit money that could be awarded to film and TV projects earlier this year, from $330 million to $750 million, according to the California Film Commission.
The next round of tax credits is going to TV shows such as the reboot of the hit 1990s show “Baywatch,” which received more than $21 million in this latest round. According to a database of projects given tax credits by the California Film Commission, that show is relocating to California after shooting in another state.
Another project, called “Blood Ties,” got more than $3 million in tax credits, while season 3 of the Amazon Studios show “Fallout” received $42 million in tax credits. The second season of another Amazon Studios show, “Mr. & Mrs. Smith,” got more than $31.9 million in tax credits.
In this latest round of tax credits, several different studios that might be familiar to many moviegoers and television watchers got the most amount of tax credits. These included Universal Television, Amazon Studios, Netflix, Sony Pictures Television and 20th Century Fox Film Corp. Out of these seven studios, 20th Century Fox got a total of $109,339,000 in tax credits for six projects in the latest round of tax credit allocation, more projects than any of the other studios this round.
“California continues to prove that when we invest in our creative workforce, the industry invests right back in us,” said Colleen Bell, director of the California Film Commission, in a Thursday press release. “These series aren’t just coming home, they’re bringing thousands of jobs, hundreds of millions in wages, and long-term economic value to our state. The momentum we’re seeing is exactly what this program was designed to deliver.”
However, an economist at Pacific Research Institute, a research organization that advocates for free-market solutions, says giving television production studios a break on their tax burden isn’t a way to bring movie and TV production back to California or create jobs.
“To be tongue in cheek, that’s what California has always needed,” Wayne Winegarden, senior fellow at the Pasadena-based institute, told The Center Square. “Everything’s going poorly, but we’re going to get ‘Baywatch’ back. This is not good for the state. California shouldn’t have to bribe studios to make TV shows and movies in California.”
State Sen. Ben Allen, D-El Segundo, who sits on the Senate Joint Committee on the Arts, sent a statement to The Center Square via email on Tuesday.
“I’ve watched the industry dwindle over recent years as projects have left the state to pursue more robust incentives around the globe,” Allen wrote to The Center Square. “Thanks to our modernized, more competitive program, we get to say, ‘no more.’ This has provided a life raft for our workforce and local economy — putting people back to work as we are already seeing projects relocating to California and revitalizing the global hub of entertainment once again.”
The Legislative Analyst’s Office, which provides fiscal and policy advice to the Legislature, told The Center Square on Tuesday that the film tax credit isn’t the best way to generate revenue, especially in light of the state’s upcoming $18 billion budget shortfall for the 2026-27 fiscal year.
“We don’t necessarily consider the film tax credit as a way to generate additional revenue,” said Rowan Isaaks, an economist who works on issues related to the film and TV industry at the Legislative Analyst’s Office. “Obviously, the film tax credit itself reduces revenues because it reduces the tax liability of taxpayers who are involved in the production of movies and TV shows.”
For every dollar of tax credit given out to such recipients, Isaaks told The Center Square, some portion of that is paid back to the state in increased economic activity, he added.
“But on the net, we don’t expect it to generate revenue or even be revenue-neutral,” Isaaks said.
The Legislative Analyst’s Office released a report earlier this year analyzing Gov. Gavin Newsom’s proposed cap on the film and TV tax credit program from $330 million to $750 million, which later passed. The expansion of the film and TV tax credit program applies to fiscal years 2025-26 through 2029-30. The report said expanding the program would definitely increase the number of film and TV productions filmed in California because it would incentivize other productions filmed in other states to relocate to filming in California. However, the office acknowledged that the Legislature would have to consider balancing the protection of Hollywood with other priorities.
“Although the film tax credit likely increases the size of California’s film industry, there is weak evidence that expanding the tax credit would benefit California’s economy as a whole,” the report read. “Therefore, we recommend the Legislature consider adopting the Governor’s proposal only if the Legislature views maintaining California’s market share of the film industry as a high priority and an end in itself.”
Newsom was not available to answer The Center Square’s questions on Tuesday, but commented on the tax credits in a news release.
“California’s creative economy isn’t just part of who we are – it helps power this state forward,” Newsom said. “From the folks on the soundstage to the people designing the sets, these are jobs that anchor communities. And when we make smart investments like our film tax credit, we’re keeping talent here at home, supporting good-paying union jobs, and strengthening an industry that defines the California brand.”
