As production numbers dwindle and competition intensifies, New York is stepping up its game to reclaim its position as a top-tier destination for film and television production. Governor Kathy Hochul announced a robust expansion of the state’s film and TV tax incentive program, designed to attract big-budget productions and support independent filmmakers, while giving New York a competitive edge over neighboring states and international hubs.
Among the highlights of Hochul’s proposal is a new $100 million fund exclusively for independent films, offering much-needed relief to smaller productions that have struggled to access incentives in an oversubscribed system. Additionally, the governor unveiled a 10% bonus credit on top of the 30% base rate for companies producing at least three large-scale projects in the state—a move aimed squarely at enticing major studios to commit to New York for the long haul.
The Stakes Are High for New York’s Film Industry
Production spending in New York has dropped by 15% since 2019, with applications for the state’s tax credit plummeting 53% over the last five years, even after the program’s annual cap nearly doubled from $420 million to $700 million in 2023. This downturn mirrors trends across the U.S., Canada, and the U.K., as studios pull back in response to shifting economics in the streaming era. The impact has been deeply felt by crews and local businesses, with some lawmakers warning of long-term damage to the state’s creative ecosystem.
New York is also feeling the heat from New Jersey, where aggressive incentives offer up to 39% in production cost reimbursements, making it a formidable rival for projects that might have otherwise stayed in the Empire State.
Leveling the Playing Field
Hochul’s proposal addresses key concerns raised by studios and independent producers alike. Notably, the $500,000 cap on salaries for actors, directors, writers, and producers would be removed, aligning New York’s program with industry standards in New Jersey and other states. This change makes New York more attractive for larger productions, particularly those with star-driven budgets.
Additionally, the governor plans to eliminate the multi-year payout structure for tax credits, which has been a major pain point for both studios and independents. By offering the full credit in the first year of allocation, New York hopes to speed up the cash flow and reduce financial strain on productions.
The proposed $100 million independent film fund is another game-changer, ensuring smaller productions can access vital incentives without competing against blockbuster projects for resources. Allocated on a first-come, first-served basis, this set-aside would be in addition to the $700 million annual cap, effectively raising the total budget for incentives to $800 million.
This is particularly significant as independent productions often face greater financial challenges, with delayed payouts disproportionately impacting their ability to sustain operations.
Industry Reaction
The Motion Picture Association (MPA) praised the move, calling Hochul a “champion for New York State’s creative community.” In a statement, the MPA emphasized the economic ripple effect of productions, noting that major films contribute $1.3 million daily to local communities, while TV series add $475,000 per day.
“She recognizes that when a movie or series films in cities and towns – from Yonkers to Buffalo – the production creates high-quality, high-paying jobs for local workers and supports local businesses,” the statement read.
Not everyone is on board. State Senator James Skoufis has criticized the incentive program, citing a 2023 audit that found it generates 31 cents in tax revenue for every dollar invested. While acknowledging that a repeal is unlikely, Skoufis has called for closer scrutiny of the program’s long-term benefits.
New York’s renewed efforts come as California and British Columbia also expand their programs. Governor Gavin Newsom recently proposed boosting California’s tax incentive to $750 million annually, while British Columbia is increasing its program to CA$1.2 billion (approximately $843 million USD). With production levels struggling to recover post-COVID and amid strikes, these states and provinces are vying to attract productions that could shape their creative economies for years to come.
The Path Ahead
Governor Hochul’s enhanced incentives aim to secure New York’s place in an increasingly competitive production market. By addressing studio concerns, supporting independent filmmakers, and streamlining financial processes, New York is positioning itself as a more attractive destination for production while bolstering its creative workforce and local economies.
As Hochul’s proposal heads to the Legislature, the stakes couldn’t be higher—not just for New York, but for the thousands of crew members and businesses that depend on a thriving film and television industry.
