February 27, 2012

State of Alabama
Press Release: Alabama Department of Commerce

Alabama Film Production Increases Due to Incentives

For Release:    Monday, 11:45 a.m. - The Alabama Development Office


MONTGOMERY – The passage of the 2009 Alabama Entertainment Act, which allowed for film incentives, has brought significant growth to the state’s film industry.


The Alabama Film Office (AFO) reports that in 2011 they received 112 inquiries for assistance from film productions. These requests ranged from big budget feature films, independent film makers and producers from around the world scouting locations in all parts of Alabama. The inquiries resulted in 18 commercials, 7 television series, 5 films and 4 music videos being shot in Alabama. This does not include countless episodic network shows such as “Extreme Home Makeover”, “Wife Swap”, “Hoarders”, “Dirty Jobs”, “Storm Chasers” and even the “Today Show”.


In 2011, production companies spent approximately $22.5M in Alabama and more than $5.6M was reimbursed to these companies through the incentives, according to the Alabama Film Office.


In the first quarter of 2012, an estimated $6M in incentives are already committed and it is expected that the $10M allowance for this year will be reached. “We hope the legislature will agree to increase our incentives and pass HB243 so that we will see more production and continue to build the crew base necessary to support this industry” says Alabama Film Manager Kathy Faulk.


The benefits of the 2009 Act were felt as The Hallmark movie “A Smile as Big as the Moon” was filmed at the U.S. Space & Rocket Center in Huntsville. “Smile”, a true story based on special needs children attending Space Camp, was seen by 6.8 million viewers on ABC and 7.9 million the following week on the Hallmark Channel. “Almost 15 million viewers heard about Huntsville and Space Camp for two hours while watching this movie”, said Faulk, “this is great exposure for our state and the Huntsville area”.


The 2010 amendment to the Film Incentives Act brought the addition of television series which resulted in numerous reality shows locating to Alabama. These shows included the Country Music Television (CMT) series “Sweet Home Alabama” which is currently airing its third season and showcases beautiful sunsets and southern hospitality in Fairhope and the Mobile area. Also the History Channel’s “Big Shrimpin’” filmed along the gulf coast and the National Geographic Channel series “Rocket City Rednecks” filmed in the Decatur and Huntsville areas. In its first season, “Sweet Home Alabama” was the highest rated series in the history of the CMT network.


The success and growth of this industry has also contributed to a leading global payroll service company, “Entertainment Partners,” locating to the Birmingham area. In working with the AFO employees, EP developed an interest in Alabama. With offices in ten states, EP is a highly respected company in the film industry and sees great potential for Alabama in the film industry.


In the 2012 legislative session, HB243 was introduced by Representative Terri Collins of Decatur (companion bill SB290 by Senator Gerald Dial of Lineville) which will amend the Entertainment Act of 2009 by increasing the film incentives for the per project amount.  Currently the maximum amount that is allowed is $10M and this bill raises that limit to $20M.  The bill also increases by $5M per year the amount that the state can reimburse.


 ‘We believe this phased-in approach to increasing the incentive structure will attract larger films and more TV series which create jobs in our state,” said Alabama Development Office Director Greg Canfield. “Alabama’s film incentives are more conservative than most states, but still allow for small and independent films, television series, documentaries and commercials,” said Canfield.


A CPA certified audit is required upon completion of a project and a standard Alabama tax return must be filed before reimbursements are allowed. Production companies must also register with the Secretary of State, which is not required by most states.


The Alabama Film Incentives includes the following:


·         A qualified production company is entitled to a 25% refundable tax credit for all production expenditures in Alabama. Payroll wages to residents of Alabama earn 35%.


  • A qualified production company’s expenditures must equal or exceed $500,000 per project and not exceed $10 million dollars. The annual cap granted to the state for incentives is $10 million dollars.


  • A qualified production company spending at least $150,000 within a 12-month period may apply for a certificate of exemption from state sales, use and lodging tax.


·         A 25% refundable tax credit for qualified production of a music video, provided that the production expenditures must equal or exceed $50,000 and do not exceed $200,000.


·         A 25% refundable tax credit for a soundtrack production used in a motion picture, provided that the production expenditures must equal or exceed $50,000 and do not exceed $300,000.


AFO continues to scout locations and process incentive requests for producers researching Alabama for their projects in 2012. Several large projects are currently looking at the state and ADO and AFO are hopeful the increase in incentives will help entice them to locate here. “Alabama is finally receiving recognition as a serious competitor in this industry,” said Canfield.


Alabama Film Office



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