Relating to the Texas moving image industry incentive program and the establishment and funding of the Texas moving image industry incentive fund.

89(R) SB 22 - Enrolled version - Bill Text

S.B. No. 22

AN ACT

relating to the Texas moving image industry incentive program and

the establishment and funding of the Texas moving image industry

incentive fund.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

ARTICLE 1. LEGISLATIVE INTENT

SECTION 1.01. It is the intent of the legislature that the

Music, Film, Television, and Multimedia Office is not required to

act on any grant application and may deny an application because of

inappropriate content or content that portrays Texas or Texans in a

negative fashion, as determined by the office, in a moving image

project and that the office shall consider general standards of

decency and respect for the diverse beliefs and values of the

citizens of Texas when determining whether to act on or deny a grant

application.

ARTICLE 2. TEXAS MOVING IMAGE INDUSTRY INCENTIVE PROGRAM; FUND

SECTION 2.01. Section 485.021, Government Code, is amended

by adding Subdivision (1-a) to read as follows:

(1-a)

"Incentive fund" means the Texas moving image

industry incentive fund established under Section 485.0225.

SECTION 2.02. Section 485.022, Government Code, is amended

by amending Subsections (a) and (f) and adding Subsections (g),

(h), (i), and (j) to read as follows:

(a) The office shall administer a grant program for

production companies that produce moving image projects in this

state
:

(1) using money from the incentive fund; or

(2)
[
,
] to the extent that gifts, grants, donations,

or other money, including appropriations, are made available to the

office for that purpose.

(f)
The following types of projects are not eligible for

grants under this subchapter:

(1)

pornography or obscene material, as defined by

Section 43.21, Penal Code;

(2)

news, current event or public access programming,

political advertising, including public service announcements that

advance a public policy or political position, or programs that

include weather or market reports;

(3) local events or religious services;

(4)

productions not intended for commercial,

educational, or instructional distribution;

(5) sporting events or activities;

(6)

awards shows, galas, or telethons and similar

programs that solicit funds;

(7)

projects intended for undergraduate or graduate

course credit;

(8)

application software, system software, or

middleware;

(9)

casino-type video games and interactive digital

media experiences used in a gambling device, as defined by Section

47.01, Penal Code; or

(10)

commercials or advertising for this state or any

agency or department of this state.

(g)

Subsection (f) is not an exclusive list of the types of

projects that are ineligible for a grant under this subchapter. The

office has broad authority to:

(1)

designate other types of projects as ineligible

for a grant;

(2) elect not to take action on a grant application;

(3) deny a grant application; or

(4) award a grant.

(h) As part of the preliminary application process
[
Before a

grant is awarded under this subchapter
], the office shall
review

the proposed content of a moving image project in the manner

provided by office rule and advise the prospective applicant

whether the content will preclude the project from receiving a

grant under this subchapter.

(i)

Once an approved project has been completed, the office

shall review the final content before issuing the grant payment

to
[
:

[
(1) require a copy of the final script; and

[
(2)
] determine if any substantial changes occurred

during production on a moving image project to include content

described by Subsection (e)
or (f)
.

(j)

The office has broad discretion to rescind preliminary

approval at any point in the grant process.

SECTION 2.03. Subchapter B, Chapter 485, Government Code,

is amended by adding Section 485.0225 to read as follows:

Sec.

485.0225.

TEXAS MOVING IMAGE INDUSTRY INCENTIVE FUND.

(a)

In this section, "trust company" means the Texas Treasury

Safekeeping Trust Company.

(b)

The Texas moving image industry incentive fund is

established as a fund outside the state treasury to be held and

invested by the trust company and administered by the office.

(c)

Money in the incentive fund may be spent without

legislative appropriation and may be used only for the purposes of

awarding grants under this subchapter and paying the trust

company's expenses of managing the incentive fund's assets.

(d) The incentive fund consists of:

(1)

money appropriated, transferred, or deposited to

the credit of the incentive fund by the legislature;

(2)

money, including the proceeds of a fee or tax

imposed by this state, that by statute is dedicated for deposit to

the credit of the incentive fund;

(3)

investment earnings and interest earned on amounts

credited to the incentive fund; and

(4)

gifts, grants, and donations made to the office

and deposited to the credit of the incentive fund.

(e)

The trust company shall hold and invest the incentive

fund.

The incentive fund may be invested with the state treasury

pool and may be pooled with other state assets for purposes of

investment.

(f)

The overall objective for the investment of the

incentive fund is to maintain sufficient liquidity to meet the

needs of the incentive fund while striving to preserve the

purchasing power of the incentive fund over a full economic cycle.

(g)

The trust company may acquire, exchange, sell,

supervise, manage, or retain any kind of investment that a prudent

investor, exercising reasonable care, skill, and caution, would

acquire or retain in light of the purposes, terms, distribution

requirements, and other circumstances of the incentive fund then

prevailing, taking into consideration the investment of all the

assets of the incentive fund rather than a single investment.

(h)

The expenses of managing the incentive fund's assets

shall be paid from the incentive fund.

(i)

The office annually shall provide to the trust company a

forecast of the cash flows into and out of the incentive fund. The

office shall provide updates to the forecast as appropriate to

ensure the trust company is able to achieve the objective specified

by Subsection (f).

(j)

The trust company shall disburse money from the

incentive fund as directed by the office.

SECTION 2.04. Section 485.023, Government Code, is amended

to read as follows:

Sec. 485.023. QUALIFICATION. To qualify for a grant under

this subchapter:

(1) a production company must have spent a minimum of:

(A) $250,000 in in-state spending for a film or

television program; or

(B) $100,000 in in-state spending for a

commercial or series of commercials, an educational or

instructional video or series of educational or instructional

videos, or a digital interactive media production;

(2) [
at least 55 percent of the production crew,

actors, and extras for a moving image project must be Texas

residents
] unless the office determines and certifies in writing

that a sufficient number of qualified crew, actors, and extras are

not available to the company at the time principal photography

begins
, the percentage of the production crew, actors, and extras

for a moving image project who are Texas residents must be at least:

(A)

35 percent for a moving image project that

begins principal photography on or after September 1, 2025, and

before September 1, 2027;

(B)

40 percent for a moving image project that

begins principal photography on or after September 1, 2027, and

before September 1, 2029;

(C)

45 percent for a moving image project that

begins principal photography on or after September 1, 2029, and

before September 1, 2031; and

(D)

50 percent for a moving image project that

begins principal photography on or after September 1, 2031
;

(3) at least 60 percent of the moving image project

must be filmed in Texas; and

(4) a production company must submit to the office an

expended budget, in a format prescribed by the office, that

reflects all in-state spending and includes all receipts, invoices,

pay orders, and other documentation considered necessary by the

office to accurately determine the amount of a production company's

in-state spending that has occurred.

SECTION 2.05. Sections 485.024(a) and (c), Government Code,

are amended to read as follows:

(a) Except as provided by Section 485.025,
for a moving

image project that is:

(1)

a feature film, a television program other than a

reality television program, or a visual effects project for a

feature film or television program other than a reality television

program with total in-state spending of:

(A)

at least $250,000 but less than $1 million,

the amount of
a grant under this subchapter
is equal to five percent

of total in-state spending for the project;

(B)

at least $1 million but less than $1.5

million, the amount of a grant under this subchapter is equal to 10

percent of total in-state spending for the project; or

(C)

at least $1.5 million, the amount of a grant

under this subchapter is equal to 25 percent of total in-state

spending for the project;

(2)

a digital interactive media production with total

in-state spending of:

(A)

at least $100,000 but less than $1 million,

the amount of a grant under this subchapter is equal to five percent

of total in-state spending for the project;

(B)

at least $1 million but less than $1.5

million, the amount of a grant under this subchapter is equal to 10

percent of total in-state spending for the project; or

(C)

at least $1.5 million, the amount of a grant

under this subchapter is equal to 25 percent of total in-state

spending for the project;

(3)

a reality television program as defined by office

rule with total in-state spending of:

(A)

at least $250,000 but less than $1 million,

the amount of a grant under this subchapter is equal to five percent

of total in-state spending for the project; or

(B)

at least $1 million, the amount of a grant

under this subchapter is equal to 10 percent of total in-state

spending for the project; or

(4)

a commercial, a series of commercials, an

educational or instructional video, a series of educational or

instructional videos, or a visual effects project for a commercial,

series of commercials, educational or instructional video, or

series of educational or instructional videos with total in-state

spending of:

(A)

at least $100,000 but less than $1 million,

the amount of a grant under this subchapter is equal to five percent

of total in-state spending for the project; or

(B)

at least $1 million, the amount of a grant

under this subchapter is equal to 10 percent of total in-state

spending for the project
[
may not exceed the amount established by

office rule. The office shall adopt rules prescribing the method

the office will use to calculate the amount of a grant under this

subsection. The office shall publish a written summary of the

method for determining grants before awarding a grant under this

section. The method must consider at a minimum:

[
(1)

the current and likely future effect a moving

image project will have on employment, tourism, and economic

activity in this state; and

[
(2)

the amount of a production company's in-state

spending for a moving image project
].

(c) The office may [
only
] make a grant from
the incentive

fund or
appropriated funds.

SECTION 2.06. Section 485.025, Government Code, is amended

to read as follows:

Sec. 485.025. ADDITIONAL
GRANTS
[
GRANT
] FOR
CERTAIN

PROJECTS
[
UNDERUTILIZED AND ECONOMICALLY DISTRESSED AREAS
].
(a)

In addition to the grant calculated under Section 485.024, a

production company
is eligible for:

(1)

a Texas heritage grant in an amount equal to 2.5

percent of total in-state spending for a moving image project that

qualifies under Subsection (b);

(2)

a rural filming grant in an amount equal to 2.5

percent of total in-state spending for a moving image project that

qualifies under Subsection (c);

(3)

a postproduction grant in an amount equal to one

percent of total in-state spending for a moving image project that

qualifies under Subsection (d);

(4)

a Texas veterans grant in an amount equal to 2.5

percent of total in-state spending for a moving image project that

qualifies under Subsection (e);

(5)

a faith-based moving image project grant in an

amount equal to 2.5 percent of total in-state spending for a moving

image project that qualifies under Subsection (f);

(6)

a Texas historic site grant in an amount equal to

2.5 percent of total in-state spending for a moving image project

that qualifies under Subsection (g); or

(7)

a workforce development grant in an amount equal

to 2.5 percent of total in-state spending for a moving image project

that qualifies under Subsection (h).

(b)

A moving image project qualifies for a Texas heritage

grant under Subsection (a)(1) if the project is designated by the

office as a Texas heritage project according to rules adopted by the

office.

The office is not required to designate any moving image

project as a Texas heritage project and has sole discretion to make

that designation.

In determining whether to designate a moving

image project as a Texas heritage project, the office shall

consider:

(1)

the project's current and likely future effect on

the promotion of family values; or

(2)

whether the project portrays Texas and Texans in a

positive fashion.

(c)

A moving image project qualifies for a rural filming

grant under Subsection (a)(2) if the production company spends at

least 35 percent of the project's filming days or man hours, as

applicable and as defined by office rule, in a county in this state

with a population of 300,000 or less.

(d)

A moving image project qualifies for a postproduction

grant under Subsection (a)(3) if at least 25 percent of the total

in-state spending for the project is spent by the production

company during postproduction on eligible expenditures as provided

by office rule, including expenditures for labor, vendor, and music

costs.

(e)

A moving image project qualifies for a Texas veterans

grant under Subsection (a)(4) if at least five percent of the

production crew, actors, and extras for the project are Texas

residents who served in and were honorably discharged from:

(1)

the army, navy, air force, coast guard, or marine

corps of the United States;

(2)

the Texas National Guard as defined by Section

431.001; or

(3)

a reserve component of an entity listed in

Subdivision (1) or (2).

(f)

A moving image project qualifies for a faith-based

moving image project grant under Subsection (a)(5) if the project

is designated by the office as a faith-based moving image project

according to rules adopted by the office. The office is not

required to designate any moving image project as a faith-based

moving image project and has sole discretion to make that

designation.

(g)

A moving image project qualifies for a Texas historic

site grant under Subsection (a)(6) if the production company

utilizes historic sites in this state as filming locations. The

office shall adopt rules to implement and administer this

subsection.

(h)

A moving image project qualifies for a workforce

development grant under Subsection (a)(7) if the production company

partners with an institution of higher education in this state to

provide moving image industry workforce development opportunities

during production of the project. The office shall adopt rules to

implement and administer this subsection.

(i)

A moving image project may qualify for and receive more

than one additional grant under Subsection (a).

However, the total

amount of all grants received by a moving image project may not

exceed 31 percent of the total in-state spending for the project

[
that spends at least 25 percent of a moving image project's filming

days in an underutilized and economically distressed area is

eligible for an additional grant in an amount equal to 2.5 percent

of the total amount of the production company's in-state spending

for the moving image project
].

SECTION 2.07. Section 151.801, Tax Code, is amended by

amending Subsection (a) and adding Subsection (g) to read as

follows:

(a) Except for [
the
] amounts
otherwise
allocated under
this

section
[
Subsections (b), (c), (c-2), (c-3), and (f)
], all proceeds

from the collection of the taxes imposed by this chapter shall be

deposited to the credit of the general revenue fund.

(g)

Not later than the 30th day of each state fiscal

biennium, the comptroller shall deposit to the credit of the Texas

moving image industry incentive fund established under Section

485.0225, Government Code, $300 million of the proceeds from the

collection of the taxes imposed by this chapter.

SECTION 2.08. (a) The Music, Film, Television, and

Multimedia Office shall adopt rules necessary to implement and

administer Subchapter B, Chapter 485, Government Code, as amended

by this article.

(b) The comptroller of public accounts may adopt rules

necessary to implement and administer Section 485.0225, Government

Code, as added by this article.

ARTICLE 3. SUNSET PROVISIONS

SECTION 3.01. Effective September 1, 2035, Sections

485.022(a) and (f), Government Code, are amended to read as

follows:

(a) The office shall administer a grant program for

production companies that produce moving image projects in this

state, to the extent that gifts, grants, donations, or other money,

including appropriations, are made available to the office for that

purpose.

(f) Before a grant is awarded under this subchapter, the

office shall:

(1) require a copy of the final script; and

(2) determine if any substantial changes occurred

during production on a moving image project to include content

described by Subsection (e).

SECTION 3.02. Effective September 1, 2035, Section 485.023,

Government Code, is amended to read as follows:

Sec. 485.023. QUALIFICATION. To qualify for a grant under

this subchapter:

(1) a production company must have spent a minimum of:

(A) $250,000 in in-state spending for a film or

television program; or

(B) $100,000 in in-state spending for a

commercial or series of commercials, an educational or

instructional video or series of educational or instructional

videos, or a digital interactive media production;

(2) at least 55 percent of the production crew,

actors, and extras for a moving image project must be Texas

residents unless the office determines and certifies in writing

that a sufficient number of qualified crew, actors, and extras are

not available to the company at the time principal photography

begins;

(3) at least 60 percent of the moving image project

must be filmed in Texas; and

(4) a production company must submit to the office an

expended budget, in a format prescribed by the office, that

reflects all in-state spending and includes all receipts, invoices,

pay orders, and other documentation considered necessary by the

office to accurately determine the amount of a production company's

in-state spending that has occurred.

SECTION 3.03. Effective September 1, 2035, Sections

485.024(a) and (c), Government Code, are amended to read as

follows:

(a) Except as provided by Section 485.025, a grant under

this subchapter may not exceed the amount established by office

rule. The office shall adopt rules prescribing the method the

office will use to calculate the amount of a grant under this

subsection. The office shall publish a written summary of the

method for determining grants before awarding a grant under this

section. The method must consider at a minimum:

(1) the current and likely future effect a moving

image project will have on employment, tourism, and economic

activity in this state; and

(2) the amount of a production company's in-state

spending for a moving image project.

(c) The office may only make a grant from appropriated

funds.

SECTION 3.04. Effective September 1, 2035, Section 485.025,

Government Code, is amended to read as follows:

Sec. 485.025. ADDITIONAL GRANT FOR UNDERUTILIZED AND

ECONOMICALLY DISTRESSED AREAS. In addition to the grant calculated

under Section 485.024, a production company that spends at least 25

percent of a moving image project's filming days in an

underutilized and economically distressed area is eligible for an

additional grant in an amount equal to 2.5 percent of the total

amount of the production company's in-state spending for the moving

image project.

SECTION 3.05. The following provisions added by Article 2

of this Act expire on August 31, 2035:

(1) Section 485.021(1-a), Government Code;

(2) Sections 485.022(g), (h), (i), and (j), Government

Code;

(3) Section 485.0225, Government Code; and

(4) Section 151.801(g), Tax Code.

SECTION 3.06. (a) On August 31, 2035, the Texas moving

image industry incentive fund established under Section 485.0225,

Government Code, as added by Article 2 of this Act, is abolished and

the unencumbered and unspent balance of the fund on that date is

transferred to the general revenue fund.

(b) Notwithstanding the changes in law made by this article,

a grant awarded under Subchapter B, Chapter 485, Government Code,

on or after September 1, 2025, and before September 1, 2035, is

governed by that subchapter as amended by Article 2 of this Act and

any subsequent amendments to that law by the legislature in effect

on the date the grant is awarded, and that law is continued in

effect for that purpose.

(c) A grant awarded under Subchapter B, Chapter 485,

Government Code, on or after September 1, 2035, is governed by that

subchapter as amended by this article.

ARTICLE 4. EFFECTIVE DATE

SECTION 4.01. Except as otherwise provided by this Act,

this Act takes effect September 1, 2025.

______________________________

______________________________

President of the Senate

Speaker of the House

I hereby certify that S.B. No. 22 passed the Senate on

April 16, 2025, by the following vote: Yeas 23, Nays 8; and that

the Senate concurred in House amendments on May 28, 2025, by the

following vote: Yeas 23, Nays 8.

______________________________

Secretary of the Senate

I hereby certify that S.B. No. 22 passed the House, with

amendments, on May 26, 2025, by the following vote: Yeas 114,

Nays 26, two present not voting.

______________________________

Chief Clerk of the House

Approved:

______________________________

Date

______________________________

Governor