California Moves to Secure Hollywood’s Post-Production Future with Tax Credit Bill

It is a common assumption that everyone working in film and television has amassed significant wealth, but the reality for many is far different. For decades, California and the city of Los Angeles have operated under the belief that even if productions choose to shoot elsewhere, they would eventually return to L.A. for post-production. That trend, however, is no longer a given.

A perfect storm of factors is accelerating the outsourcing of post-production work from California. The conclusion of the streaming wars, tightening budgets, shifting business models, corporate consolidation, and the looming threat of AI replacing various forms of white-collar labor have all placed immense strain on every sector of the industry, with post-production teams facing unprecedented challenges.

Compounding these issues are tax incentives designed to lure productions—and sometimes post-production—to other regions. Sarah Westman-Liu, director of tax incentives and products at Entertainment Partners, noted that jurisdictions like Canada, the UK, Ireland, Georgia, and New York have established standalone post-production programs to attract such work. However, the most successful programs tend to be in regions where the local industry infrastructure is already robust, such as the New York and New Jersey area, which is home to the second-largest concentration of members in the editors’ guild, IATSE Local 700.

Westman-Liu explained that while incentives or lower-cost territories can successfully attract filming or visual effects contracts, they rarely provide enough of a draw to relocate entire post-production operations. Consequently, even when a production is shot abroad, the post-production work is typically brought back to Los Angeles or New York. The current squeeze on L.A.’s post-production sector, therefore, stems as much from a general decline in the number of productions as it does from work moving overseas. On the ground, the impact is deeply felt. Editor Wendy Smith explained that with fewer films being made, there are fewer projects to cut. This has led some to believe they can edit independently, but Smith emphasized that editing is a highly skilled, time-consuming craft that requires a trained eye. “Editing is like a snowflake,” she said. “They all look the same, but everybody does it differently.”

Any legislative effort by California lawmakers to keep productions within the state will directly benefit post-production teams. This is where California Assembly Bill 2319, introduced by Assemblyman Nick Schultz, enters the picture. The bill recently passed its final reading in the California State Senate on August 30. Governor Gavin Newsom now has 30 days to sign it into law. While the bill currently allocates $10 million to launch the program, advocates hope to secure $100 million in tax incentive funding in the upcoming budget cycle.

The post-production community has rallied behind the bill with remarkable enthusiasm. Marielle Abaunza, president of the California Post Alliance (CAPA), highlighted the broad coalition of support, which includes labor unions, government agencies, advocacy groups, major studios like Fox, Sony, Warner Bros., and Disney, as well as the TV Academy, the Recording Academy, and various craft guilds. “It was truly a team effort,” Abaunza stated.

Daniel Williamson, an editor and union steward with IATSE Local 700, described the rapid progress of AB 2319 as heartening. He noted the overwhelming volume of calls received by state representatives’ offices, calling the responsiveness from elected officials a “nice surprise” in an industry often characterized by pessimism. “We’re always so doom and gloom about good things happening,” Williamson remarked.

Abaunza emphasized that CAPA was born out of necessity, representing a collective desire to find solutions to the crisis facing the post-production workforce. For artisans, the campaign serves as a vital rallying point and a symbol of hope for the industry’s future. Editor Erik Anderson pointed out that the tradition of mentoring and passing knowledge to the next generation of editors is beginning to cease. “When I’m approached by a young, hungry student, I don’t know what to say to them,” Anderson said. “I can teach you everything I know, but I don’t know if you’re going to have a career.”

Williamson agreed that while Los Angeles still holds a significant market share of active productions, that share has visibly decreased, with emerging hubs in Atlanta, New Jersey, and New York. He expressed a desire for more robust solutions, such as federal tax incentives, to prevent the outsourcing of cultural production. “I don’t feel like our studios should be outsourcing our culture,” Williamson added.

For now, the potential passage of AB 2319 offers a crucial carrot, providing a beacon of hope and a potential pathway to stabilizing California’s vital post-production industry.

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