Film incentives-production expense rebate.

WORKING DRAFT
2006
STATE OF
WYOMING
06LSO-0049

HOUSE BILL
NO.
HB0070

Film incentives-production expense rebate.

Sponsored by:
Representative(s) Berger, Gingery, Petersen and
Warren
and Senator(s) Burns, Coe and Peck

A BILL

for

AN ACT relating to film production incentives; creating the entertainment industry financial incentives program; providing for rebates on qualified expenditures on qualified film productions; providing for rules and regulations;
providing penalties for false claims;
providing an appropriation; and providing for an effective date.

Be It Enacted by the Legislature of the State of
Wyoming
:

Section 1.
W.S. 9
‑
12
‑
402
through
9
‑
12
‑
406 are created to read:

9
‑
12
‑
402.

Entertainment industry financial incentive program; creation.

There is created within the business council, the entertainment industry financial incentive program to encourage the use of this state as a site for filming and providing production services for motion pictures, made for television movies, commercials, music videos, industrial and educational films and television programs by the entertainment industry.

9
‑
12
‑
403.

Entertainment industry financial incentive program; definitions.

(a)

As used in this act:

(i)

"Filmed entertainment" means a motion picture, tele-production, commercial, music video or digital media effects production to be sold or displayed in an electronic medium;

(ii)

"Production costs" means the total cost of producing filmed entertainment;

(iii)

"Qualified expenditures" mean goods purchased or leased or services purchased, leased or employed from a resident of this state or a vendor or supplier who is located and doing business in this state;

(iv)

"Qualified production" means filmed entertainment that makes qualified expenditures in this state for the total or partial production of a motion picture, made for television movie with a running time of ninety (90) minutes or more, commercial music video, industrial and education film, television series pilot or television episode. Productions that are deemed by the business council to contain obscene content, as defined by the United States Supreme Court, shall not be considered qualified productions;

(v)

"Qualified relocation project" means a corporation, limited liability company, partnership, corporate headquarters or other private entity that is domiciled in another state or country and relocates its operations to this state and includes as one of its primary purposes digital media effects or motion picture and television production or post-production;

(vi)

"This act" means W.S. 9
‑
12
‑
402 through 9
‑
12
‑
406.

9
‑
12
‑
404.

Entertainment industry financial incentive program; application procedure; approval process.

(a)

Any entity engaged in this state in producing filmed entertainment may submit an application to the business council for the purpose of determining qualification for receipt of reimbursement as provided in this act. The council shall be provided information required to determine if the production is a qualified production and to determine the qualified expenditures, production costs and other information necessary for the council to determine both eligibility for and level of reimbursement.

(b)

A digital media effects entity in this state which furnishes digital material to a qualified production may submit an application to the business council for the purpose of determining qualification for receipt of reimbursement authorized under this act.

(c)

Any qualified relocation project may submit an application to the business council for the purpose of determining qualification for reimbursement under this act.

(d)

The business council shall establish a process by which an application is accepted and reviewed, reimbursement eligibility is certified and reimbursement amounts are determined in accordance with W.S. 9-12-405. The business council shall deny an application if it determines that the application is not complete, is not in accordance with this act or rules and regulations promulgated under this act or if the application does not meet the requirements of W.S. 9-12-405.

(e)

The business council shall develop a standardized application form for use in approving a qualified production, a qualified relocation project or a company qualifying under subsection (b) of this section. The application form shall include, but is not limited to:

(i)

Production related information on employment;

(ii)

Proposed total production budgets;

(iii)

Planned expenditures in this state which are intended for use exclusively as an integral part of pre-production, production or post-production activities engaged in primarily in this state; and

(iv)

A signed affidavit by a person authorized to commit the company that the information on the application form has been verified and is correct.

(f)

The council shall not certify any qualified production, qualified relocation project or digital media effects company expenditures under this act until the council determines that the reimbursement authorized under this act will:

(i)

Further a legitimate public purpose including:

(A)

Providing public visibility of
Wyoming
as a tourist or business destination; or

(B)

Provide new employment opportunities within
Wyoming
for
Wyoming
workers
.

(ii)

Not exceed the amount of benefit gained by the state resulting from the qualified production, qualified relocation project or digital media effects company expenditures.

9
‑
12
‑
405.

Entertainment industry financial incentive program; reimbursement eligibility; submission of required documentation; payment.

(a)

A qualified production that is certified by the business council is eligible for the following financial incentives from the program:

(i)

A reimbursement of up to fifteen percent (15%) of its qualifying expenditures in this state on qualified production that demonstrates a minimum of five hundred thousand dollars ($500,000.00) in total qualified expenditures. Payments under this section in a fiscal year shall be made by application on a first-come, first-served basis until the appropriation for that fiscal year is exhausted. Subject to subsequent appropriations, the eligibility of qualified productions shall carry over from year to year. The business council shall develop a procedure to ensure that qualified productions continue on a reasonable schedule until completion. If a qualified production is not continued according to a reasonable schedule, the council shall withdraw its eligibility and reallocate the funds to other qualified productions
;

(ii)

Qualified expenditures for which reimbursement may be made include:

(A)

Salaries and employment benefits for services rendered in this state, except that the salaries for the two (2) highest paid actors may not be reimbursed;

(B)

Rents for real and personal property located in this state used in the production;

(C)

Payments for pre-production, production, post-production and digital media effects services rendered in this state;

(D)

Costs of set construction.

(b)

A digital media effects company in the state which furnishes digital material to a qualified production may be eligible for a payment in an amount not
to
exceed five percent (5%) of its annual gross revenues on qualified expenditures listed in paragraph (a)(ii) of this section before taxes or one hundred thousand dollars ($100,000.00)
,
whichever is less. A company applying for payment under this subsection shall submit documentation annually for determination of eligibility of claimed billing and determination of the amount of payment for which the company is eligible.

(c)

A qualified relocation project is eligible for a one
-
time incentive payment in an amount equal to five percent (5%) of its annual gross revenues before taxes for the first twelve (12) months of conducting business in this state or two hundred thousand dollars ($200,000.00), whichever is less. A company applying for payment under this subsection shall submit documentation as required by the council for determination of eligibility of claimed billing and determination of the amount of payment for which the company is eligible.

(d)

A qualified production, digital media effects company or a qualified relocation project applying for a payment under this section must submit documentation for claimed qualified expenditures to the council.

9
‑
12
‑
406.

Entertainment industry financial incentive program; rules and regulations; fraudulent claims; reporting.

(a)

The business council shall adopt rules and regulations to implement this act, including, but not limited to, requirement
s
for the application and approval process, records required for submission for substantiation of reimbursement and determination of and qualification for reimbursement.

(b)

An eligible entity or company that obtains payment under this act through a claim that is fraudulent is liable for reimbursement of the amount paid plus a penalty in an amount double the payment plus reimbursement of reasonable costs, which penalty is in addition to any criminal penalty for which the entity or company is liable for the same acts. The entity or company shall also be liable for costs and fees incurred by the state in investigating and prosecuting the fraudulent claim.

(c)

The business council shall provide an annual report on January 1 to the governor and the legislature outlining the return on investment to the state on funds expended pursuant to this act.

Section 2.
W.S. 9
‑
12
‑
104(a) by creating a new paragraph (xxi) and 9
‑
12
‑
112(a) by creating a new paragraph (v) are amended to read:

9
‑
12
‑
104.

General powers and duties of the council.

(a)

Except as otherwise limited by this act, the council may:

(xxi)

Administer the e
ntertainment industry financial incentive program
as provided in W.S. 9
‑
12
‑
402 through 9
‑
12
‑
406.

9
‑
12
‑
112.

Annual report and budget.

(a)

The council shall submit an annual report in the manner provided by W.S. 9
‑
2
‑
1014 and using the benchmarks prescribed in this act. In addition to the requirements of W.S. 9
‑
2
‑
1014, included within the annual report shall be:

(v)

A report of annual expenditures under the entertainment industry financial incentive program as provided in W.S. 9
‑
12
‑
402 through 9
‑
12
‑
406 and a report of how individual recipients of rebates under the entertainment industry financial incentive program qualify for certification under W.S. 9
‑
12
‑
404(f).

Section 3.
There is appropriated
two million
dollars ($
2,
0
00,000.00
) from the general fund for fiscal year
s
200
7
-200
8
to the business council for purposes of providing entertainment industry financial incentive program rebates authorized under this act.

Section 4.
This act is effective July 1, 2006.

(END)

1
HB0070