California Code of Regulations
Title 10 - Investment
Chapter 7.75 - California Film Commission
Article 4 - California Soundstage Filming Tax Credit Program
Section 5536 - Approved Applicant Responsibilities - Phase B
Universal Citation: 10 CA Code of Regs 5536
Current through Register 2024 Notice Reg. No. 38, September 20, 2024
(a) A Phase B applicant issued a CAL, Form SD (August 12, 2022), hereby incorporated by reference, following approval for Phases A and B by the CFC shall be required to comply with the following during the production period:
(1)
Principal photography in California shall commence no later than one hundred eighty
(180) calendar days after the CAL is issued. Qualified motion pictures with
qualified expenditures of at least one hundred million dollars ($100,000,000) must
begin principal photography (as defined in section
5520(u)) no later than
two hundred and forty (240) calendar days after CAL issuance. If the production does
not begin principal photography prior to the 180- or 240-day deadline, the tax
credit allocation shall be revoked, unless a Force Majeure event has occurred which
directly prevented the production from commencing within the deadline, as described
in sections
17053.98(b)(18)(B)(iv)
and
23698(b)(18)(B)(iv)
of the Revenue and Taxation Code. With submission of documentation verifying such
event, the CFC shall grant an extension. If a production implements a hiatus during
the principal photography period, any hiatus period(s) may be no longer than one
hundred twenty (120) calendar days in aggregate for the entire duration of the
production.
(2) As soon as feasible, but
not less than four (4) weeks prior to the start of principal photography, the
production accountant is required to attend an orientation meeting with the Director
of the CFC or their designee, along with any or all of the following staff members:
a primary producer, production manager or other appropriate personnel as determined
by the applicant. Applicants and staff members shall not be required to attend more
than one (1) orientation meeting for a motion picture in the Program.
(3) On the first day of principal photography and
after a hiatus period, if applicable, submit by email to the CFC the daily call
sheet, signed by the production manager or equivalent position, in PDF or equivalent
non-proprietary document format.
(4)
Each week or as available, submit by email to the CFC the final production reports
for each day of principal photography, signed by the Unit Production Manager or
equivalent position, in PDF or equivalent non-proprietary document format.
(5) If applicable, submit an email notification to
the CFC indicating any significant changes to the project including anticipated
changes in the estimated qualified expenditures, change of start date, shooting
location, number of television episodes ordered, title change of project, financing,
key personnel or any other factors that have significantly changed since issuance of
the CAL.
(6) Participation in
career-based learning and training programs and public service opportunities
approved by the CFC in consultation with the California Department of Education
(CDE) and/or California Community College Chancellor's Office (CCCCO) aimed at
exposing career-based learning program, high school, community college, and
California State University students to careers in the entertainment industry. To
demonstrate compliance with this requirement the applicant must submit the
applicable form for Soundstage Career Readiness verification, Form SCR1, SCR2, SCR3,
SCR4, or SCR5 (March 11, 2022), hereby incorporated by reference, to the CFC as soon
as the career-based learning and training program or public service opportunity has
concluded. To meet the requirements of this section, the applicant may do any of the
following:
(A) Provide to students enrolled within
the past twelve months in an accredited California high school, community college,
California State University, or career-based learning program three (3) paid
internship positions for a minimum of one hundred (100) hours each or a combination
of internships or internship with a minimum of one hundred (100) hours per student
and three hundred (300) hours in total. Interns must be 18 years of age or older.
Internship experience must include working with professionals in the film industry
and hands-on work assignments; or
(B)
Provide to students enrolled within the past twelve months in an accredited
California high school, community college, California State University, or
career-based learning program classroom workshops, panels, or demonstrations on
aspects of the film industry, which may include but is not limited to set
operations, post-production and specific technical crafts conducted by entertainment
industry professionals; or
(C) Provide
to students enrolled within the past twelve months in an accredited California high
school, community college, California State University, or career-based learning
program a minimum of eight (8) hours of professional skills tours, which may include
visits to observe set operations, set construction, wardrobe department, art
department and editorial department; or
(D) Provide a minimum of eight (8) hours of
continuing education for educators and/or faculty to observe the set operations,
post-production, and other specialized departments in the film industry;
or
(E) Make a financial contribution to
a specific local or state educational agency or higher education institution
specializing in arts, media, and entertainment career-oriented programs. The
contribution shall be based on 0.25 percent of the estimated tax credit reservation
with a minimum financial contribution of $5,000 and a maximum required financial
contribution of $12,000. (Note: An applicant may contribute an amount in excess of
the maximum); or
(F) Provide a learning
opportunity or financial contribution of equal time or value through other arts,
media, and entertainment programs, workforce programs, etc., which are not
affiliated with CCCCO or CDE, but which have been proposed to and approved by the
CFC, on a case by case basis, as having been demonstrated by the applicant to be a
learning opportunity or financial contribution of equal time or value to the other
options in this paragraph.
(7) A qualified motion picture shall make a
contribution to the Career Pathways Training Program as specified in Revenue and
Taxation Code sections
17053.98(e),
17053.98(k)(10)(B),
23698(e),
and
23698(k)(10)(B).
(A) The contribution shall be based on 0.5 percent
of the estimated tax credit reservation as stated on the CAL.
(B) The contribution shall be submitted to the CFC
with the career pathways program form, Form SCPP (July 28, 2023), hereby
incorporated by reference, no later than thirty (30) business days after the CAL
date; failure to submit the contribution within this time frame will result in
revocation of the CAL.
1. An applicant facing a
technical or funds-related barrier to meeting the deadline may request an extension
of up to ten (10) business days and the CFC will grant the extension if the
applicant requests such an extension prior to the expiration of the timeframe
specified in subparagraph (B) above and provides supporting documentation.
(C) The contribution is refundable if
the project does not receive a tax credit certificate, Form SM (August 12, 2022),
hereby incorporated by reference. A portion may also be refundable if the tax credit
amount is significantly reduced due to reasonable cause, as defined in section
5520(y).
(D) A qualified motion picture that receives an
increase in allocated tax credits, causing an additional contribution sum to become
due, shall make a payment of that additional sum within thirty (30) business days of
notification of that increase in allocation.
(E) The contribution must be made by business or
personal check. No other payment options will be accepted.
Note: Authority cited: Sections 17053.98(k)(10) and 23698(k)(10), Revenue and Taxation Code; and Section 11152, Government Code. Reference: Sections 17053.95(e), 17053.98(k)(1), 17053.98(k)(4), 17053.98(k)(10), 17053.98(b), 17053.98(e), 23695(e), 23698(k)(1), 23698(k)(4), 23698(k)(10), 23698(b) and 23695(e), Revenue and Taxation Code; and Section 14998.1, Government Code.
Note: Authority cited: Sections 17053.98(k)(10) and 23698(k)(10), Revenue and Taxation Code; and Section 11152, Government Code. Reference: Sections 17053.95(e), 17053.98(k)(1), 17053.98(k)(4), 17053.98(k)(10), 17053.98(b), 17053.98(e), 23695(e), 23698(k)(1), 23698(k)(4), 23698(k)(10), 23698(b) and 23695(e), Revenue and Taxation Code; and Section 14998.1, Government Code.
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