Budget Break Down
Mike Seals - April 9, 2021 11:44 am
By Sen. Roger Thompson, Senate Appropriations Chair
For years, we’ve worked to expand and grow Oklahoma’s economy. We’re still very much an oil and gas state and we will continue to be. Aerospace is our number two leading economic generator and agriculture remains a top economic driver. But as we continue efforts to diversify our economy, the film industry has become increasingly important to Oklahoma and is still growing. We’ve attracted independent projects and larger studio-backed films and TV series, with titles I’m sure many of you will recognize. They include films like “I Can Only Imagine,” “American Underdog,” and most recently, “Killers of the Flower Moon,” as well as series like “The Marvelous Mrs. Maisel,” “American Gods,” and “Reservation Dogs.”
With our diverse geography and natural beauty, our modern skylines and historic, territorial era architecture, we have much to offer, and we further capitalize on that through our Oklahoma Film Enhancement Rebate Program. This incentive program offers a cash rebate of 35% to 37%. The rebate currently has an $8 million rolling cap per fiscal year, which runs from July 1 through June 30. This program has been renewed through 2027. There is no per-project cap, but each production must have a minimum budget of $50,000 with at least $25,000 in qualified Oklahoma spending.
Rebate funds are pre-qualified for eligible applicants on a first-come, first-served basis. The rebate offers a base percentage of 35% on qualified Oklahoma expenditures. However, if a minimum of $20,000 is spent on music that has been recorded in Oklahoma by an Oklahoman or on Oklahoma music production costs, an additional 2% is added to the total rebate on qualified Oklahoma expenditures, for a total of 37%.
The program also has several requirements in place to protect our state’s investments. The production company must provide proof of complete financing prior to beginning principal photography. Proof that 50% of funding is in place is due 60 days prior to the start of principal photography, and proof that complete funding is in place is due 30 days after that. Film and television projects are required to include a screen credit to the Oklahoma Film and Music Office, and the final rebate applications must be accompanied by a certified public accountant’s report, prepared at the expense of the applicant, attesting that the amounts in the application are qualified Oklahoma expenditures that comply with the requirements of the program’s administrative rules.
The film rebate program will sunset in 2027, which means without review and reauthorization, it would end, so between now and then we will continue to look at the numbers to ensure that we’re getting the biggest bang for our buck. As with any incentive, the goal is that the economic benefit to Oklahoma exceeds the investment. We not only want to bring film productions to our state, but we also want to encourage industry development here on a permanent basis.
So what do we get for that $8 million investment? In Fiscal Year 2020, productions spent over $32.8 million directly on Oklahoma crews and vendors, with 3,960 jobs created for Oklahoma residents. In the current fiscal year, it’s estimated the 33 film and television productions utilizing the state’s incentive program will create 10,218 local jobs, with a direct fiscal impact of $161.7 million.
Just looking at the most recent major film production this rebate made possible, “Killers of the Flower Moon,” this represents a $120 million investment in our state. “American Underdog: The Kurt Warner Story,” just wrapped production. Disney and FX shot a pilot near Okmulgee for a new series called “Reservation Dogs,” directed and co-written by Oklahoma filmmaker Sterlin Harjo. I’m sure there will be a lot of interest in the film “Reagan,” another major motion picture that now has Oklahoma ties.
These companies hire Oklahoma carpenters, electricians, caterers, costumers, hair and make-up artists, medics, security and more. The productions not only employ Oklahomans, but they buy products here, rent office buildings and houses, and provide business to local hotels and restaurants.
We’re also seeing an increase of home-grown film and TV production companies. There’s Green Pastures Studio, with multiple sound stages—they’re also training people to work in the industry. Also there’s Castle Row Studios in Del City, started by two OSU graduates who learned their trade in New York and California and now they’ve come back and invested more than $2 million in this recording and post-production business. Prairie Surf Media has leased the old COX Convention Center in downtown OKC and has created five sound stages for film and television productions.
It’s really an exciting time to be in Oklahoma. The rebate program created by the Legislature is attracting big film and TV productions, and the Oklahoma Film and Music Office is doing a fabulous job. Film and music are alive and well and growing in our state. And keep your eyes open—you never know if you may see a TV or movie star at your local ice cream shop.