(The Center Square) – Legislators during Nevada’s special session are reconsidering a $1.65 billion tax credit that would draw major California movie studios to Las Vegas.
If passed, Assembly Bill 5 would result in the construction of Summerlin Studios, a movie facility in Las Vegas.
Warner Bros. Discovery, which operates the historic Burbank-based Warner Bros. movie studio, and Sony Pictures Entertainment, whose Culver City movie lot was once home to MGM classics, would invest in the Las Vegas studio. Another investor is the Howard Hughes Corp., a real estate company based in The Woodlands, Texas.
After the tax credits legislation died in the legislative session this summer because of Senate inaction, the bill once again narrowly passed the state Assembly by a 22-20 vote Sunday. AB5 now awaits a vote in the Senate before potentially heading to the Gov. Joe Lombardo’s desk. As of late Tuesday afternoon, senators had not cast their votes for the legislation, which is also known as the Nevada Studio Infrastructure Jobs and Workforce Training Act.
“Every so often, we get a chance to do something that truly changes the trajectory of this state,” Assembly Majority Leader Sandra Jauregui, D-Clark County, who co-sponsored AB5 in the last legislative session, said on the Assembly floor Sunday. “Not in theory, not in slogans – but in people’s real lives.”
The film incentives bill would allocate up to $95 million annually for film infrastructure tax credits and $25 million annually for noninfrastructure tax credits. The current yearly film industry tax credit is $10 million. That would be increased by $110 million in credits between 2029 and 2044.
Legislative Counsel Bureau fiscal analyst Sarah Coffman warned that the bill would unbalance the state’s funds. She told the Assembly Committee on Jobs and Economy Thursday that the tax credits are projected to push Nevada’s final state budget $100 million below what is legally required in 2030.
“The bill we have before us is not a good deal for Nevada,” Assemblymember Jill Dickman, R-Washoe, said Sunday on the Assembly floor. “It asks taxpayers to shoulder enormous long-term costs, while offering little more than promises, projections and glossy marketing in return. And we’re being asked to approve it in a special session – not because it’s urgent, but because someone wants it rushed.”
Supporters said long-term indirect investments that come from the bill would be its biggest attraction. One estimate put it at $32 invested into the state per $1 spent by the bill, as per Summerlin Studios, which has been directly involved in supporting the bill.
Opponents have argued that such large tax cuts should not be required to attract industries to Nevada and have called into question the projections made by supporters of the bill.
