Texas continues to up the ante in its film production incentives Texas Adds Production Facility Incentives game in attempts to lure more production studios to the state. This time they are expanding the production incentives to include video games and digital content producers. The Texas Film Commission has recently created a Media Production Development Zone initiative to encourage the construction of media production facilities—including sound stages, animation facilities and game studios. The recently enacted Media Production Development Zone Act grants a sales and use tax exemption that helps studios to recover their construction or renovation costs to build (or keep) their facility in Texas.
There are, of course, specific guidelines that a facility must meet to qualify for this incentive. Facilities owners must request a sales and use tax exemption, be nominated by a city council or county commissioner, then be approved by the Texas Film Commission prior to breaking ground on the construction or renovation of a media production facility:
• You must own (or lease for at least four years) the land/building where the proposed media production facility will be built or renovated.
• The proposed facility must be used exclusively for the creation of moving image projects. Acceptable media production facilities include: soundstage, motion capture studio, animation facility, game facility, sound studio, scoring stage, editing facility, production office, construction space, and storage space.
In typical Texas fashion, the commission also notes that they will be looking out for people looking to use this as just a loop hole “A facility that consists mainly of office or construction and storage space will be scrutinized closely to ensure it complies with this requirement.”
An Independent Economic Review
According to the Film Commission, “A MPDZ exemption cannot be granted unless the Comptroller of Public Accounts certifies that the project will have a positive impact on state revenue.”
The Texas Comptroller’s office will make this determination, in part, by reviewing the economic impact analysis provided during the nomination process. This analysis must be provided by an independent “expert” with specialized knowledge, skill, experience, training or education in the subjects of economics and state and local taxation. For more information call one of our TX specialists at 781 849 5357 or email us at firstname.lastname@example.org.