Hollywood Incentives Bill Passes the CA State Assembly Without $750 Million Specified, For Now
Legislators voted 73 to one on Tuesday to pass AB 1138 and send it to the Senate, with Assemblymember Carl DeMaio of San Diego representing the sole 'no' vote. The vote comes after the state Senate passed a similar bill focused on the state's entertainment tax credit program earlier in the day, with the governor's promised cash infusion absent from the amended legislation.
More from The Hollywood Reporter
Where Did the $750 Million Go? Hollywood Incentive Bill Passes CA Senate Without Newsom's Pledge
The 13 Commandments of Being a Background Actor
After Strike Threat, Video Game Workers and Microsoft-Owned ZeniMax Media Reach Tentative Agreement
The move adds momentum to union- and studio-backed attempts to provide a shot in the arm to filming in California even as the state faces significant budget deficit concerns. Newsom has pledged support to one of California's signature industries even while existing or proposed state services are likely to be cut or pulled back as a result of the budget situation.
That's necessary, argued the bill's advocates on Tuesday. 'California's iconic film and television industry is in crisis,' said bill co-author Assemblymember Rick Zbur, who represents an area in L.A. stretching from Hollywood to Santa Monica, before the vote. 'The hardworking men and women and the small businesses that have built an industry that is intrinsic to California's identity are experiencing depression-level-eras of unemployment and loss of business as our iconic business is being lured away to other states and other countries with better credit programs.'
Other champions of the bill, like Assemblymember Tom Lackey, Assemblymember Mike Gibson and Assemblymember Sharon Quirk-Silva, emphasized that the proposed legislation was a jobs bill, not a handout to Hollywood.
'What's happened is we got a little arrogant on this film situation and we thought we're all that and a bag of chips, and you know what, the other states decided they would compete with us,' said Lackey, who represents the High Desert. 'And not only that they would compete with us, but they would take this industry.'
He said the legislation wouldn't save Hollywood, but it was an important step to make California more competitive with regard to incentives programs in other states and countries.
But the bill's one critic in Tuesday's session, DeMaio, disagreed, framing the proposed legislation as an ineffective solution that essentially sought to reward influential political allies in Hollywood. 'We should make California prosperous for all and it's not by giving out the gifts of tax credits to those that have influence, those that might make the best case to the politicians in Sacramento but rather policies that will flatten the cost curve,' he said.
DeMaio singled out California's heavily unionized Hollywood workforce and regulations as the reasons why productions fled the state, not the tax credit. 'Nothing in this bill deals with labor costs, nothing deals with the regulatory burden,' he said. DeMaio added that the bill is only attempting to 'soften the blow of some of those bad policies.'
The amended bill removes mention of Newsom's pledge to increase the film and television incentives cap from $330 million to $750 million annually, as did its companion bill in the state Senate. Advocates say that figure doesn't need to be in the bills as long as Newsom's budget is passed.
The $750 million figure survived in Newsom's revised budget, unveiled in May, even as providing Medi-Cal benefits to undocumented immigrants and Medi-Cal coverage for weight-loss drugs like Ozempic did not.
The amended bill also expands the tax credit's program for training workers from historically underrepresented communities to work in the film and television business by opening up the program to additional nonprofits.
In a sign that none of this is a done deal and the situation remains fluid, industry unions and the grassroots group Stay in L.A. have encouraged their members to continue writing to and calling their state representatives to support the bills. 'This is one of the many steps we have ahead of us, a coalition of entertainment unions told members after the Assembly and Senate bills passed on Tuesday.
Best of The Hollywood Reporter
How the Warner Brothers Got Their Film Business Started
Meet the World Builders: Hollywood's Top Physical Production Executives of 2023
Men in Blazers, Hollywood's Favorite Soccer Podcast, Aims for a Global Empire
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
an hour ago
- Yahoo
Republicans plan to use threat of third Trump impeachment as key issue to boost their standing in midterm races
Republican strategists say they plan to make a major midterm talking point from the threat of a third impeachment against Donald Trump that could come if Democrats retake the House. 'We know what the stakes are in the midterm elections,' John McLaughlin, a Trump pollster, told NBC News. 'If we don't succeed, Democrats will begin persecuting President Trump again. They would go for impeachment.' Right now, Republicans hold an eight-seat advantage in the House, walling the president off from a third impeachment, but that could change if the Democrats surge in 2026, as the president's party typically suffers during midterm elections. Still, according to Rep. Jamie Raskin, D-Md., who led the party's second impeachment against Trump over the January 6 insurrection, the Democrats themselves plan to focus more on what they see as the president's 'terrible agenda.' 'We've already impeached him twice,' Raskin told NBC. 'So obviously that's not a complete solution, given that he is able to beat the two-thirds constitutional spread. So I don't think anybody thinks that's going to be the utopian solution to our problems.' Both House impeachments — first for an alleged offer of quid pro quo with Ukraine to go after Joe Biden, then for the Capitol riot — did not have enough votes to secure convictions in the Senate. During the second Trump administration, the president has continued to face attempts to initiate new impeachment trials, including from Michigan Democrat Shri Thanedar in the spring and a June effort over the administration's Iran strikes, though none of these have come to pass. Impeachments may not be coming any time soon, but Republicans face a variety of other risks to their three-party majority control of the federal government. The president's job approval rating has dipped to 37 percent, according to Gallup, the lowest of this term and just above Trump's lowest-ever approval rating, driven by hemorrhaging support from independent voters. A majority of Americans also oppose his signature One Big, Beautiful Bill, which contains a series of tax cuts and restrictions on social programs like Medicaid. The party also continues to face fallout and internal division over the White House's handling of the Jeffrey Epstein files scandal, in which Trump and his allies campaigned on releasing materials related to the notorious financier's sexual misconduct, only to backtrack as more information concerning Epstein and Trump's long-time friendship came to light. The president has lashed out at his own base for seeking information about the scandal, which he calls a Democratic 'hoax,' while House Speaker Mike Johnson effectively ended business in the lower house until after its upcoming summer recess to avoid Democratic amendments calling for the release of the files. Meanwhile, former White House ally (and GOP mega-donor) Elon Musk has vowed to form his own political party, in the face of disagreements with the Trump administration over spending policy and the Epstein saga. There could also be blowback to economic conditions if the Trump administration's repeatedly delayed double-digit tariffs take full effect on major U.S. trading partners.
Yahoo
2 hours ago
- Yahoo
This could be the most consequential week for the economy in years
The state of President Donald Trump's economy is about to come into full view. A slew of crucial economic data is set for release this week, including the jobs report, inflation, consumer confidence and corporate earnings. We'll get the first glimpse at America's second-quarter gross domestic product, the broadest measure of the economy. And, most crucially, the Federal Reserve will decide whether to cut rates or hold steady one more time. As if that weren't enough, Trump's trade polices also come due: Friday is the administration's self-imposed deadline for settling tariff rates for all 200+ US trading partners. Trump's top economic advisers will be negotiating a trade framework with China in Sweden. And an appeals court will hear arguments this week about whether the bulk of Trump's tariffs are even legal, to begin with. Altogether, the data could paint a picture of an economy that is resilient — but slowing under the weight of Trump's dizzying tariff changes, reductions in government workers and spending, and an aggressive deportation of foreign-born workers. Here's a look at what to expect this week and why the data matters: Corporate earnings Some of the biggest names in tech are set to release earnings this week, including Microsoft, Meta, Amazon and Apple. That will set the tone for market sentiment. Tech stocks have fueled record market growth in recent months as investors focus on gearing up for AI expansion. So far, around 80% of S&P 500 companies reporting earnings this season have beaten estimates, according to FactSet. Overall, stocks have marched higher into record territory recently, supported by cautious optimism in trade deals and better-than-expected economic data. That has emboldened Trump to push harder on his trade deals, telling NBC News earlier this month that markets hit new highs because 'tariffs have been very well received.' Why it matters: Strong earnings could continue to boost the stock market, which is starting to look a bit expensive for some investors. That could also convince Trump that the market — which turned on him in April — has acquiesced to his plan for higher tariffs. Consumer confidence and sentiment Two separate reads on the way Americans are feeling about the economy are set to be released this week. Consumer confidence, as measured by Conference Board, sank to the lowest level since the pandemic when Trump slapped massive tariffs on major trading partners. Shoppers expressed concern about the negative impact on the economy and prices. But consumers are generally more optimistic now that trade deals are beginning to emerge. The consumer sentiment survey from the University of Michigan continues to show that shoppers are wary of inflation levels rising again, after the economy batted down historic price increases following the pandemic. Although sentiment has rallied back from near-record lows earlier this year, it remains depressed because of Trump's trade policy. Why it matters: Economists pay close attention to consumers' optimism, since their spending powers two-thirds of the economy — and when shoppers think prices are about to rise, they tend to pull back. The latest retail sales data shows that consumers are spending cautiously. Second-quarter GDP GDP is a key indicator of economic success and, arguably, a validation of Trump's policies. But this quarterly assessment has slumped in recent months, even shrinking in the first quarter of the year for the first time since 2022. Economists expect an improvement for the April-June quarter as imports rebalance after companies raced to front-load their purchases ahead of Trump's tariffs. They warn that, just as an inventory spike may have artificially hurt GDP in the first quarter, companies working through their warehoused goods in the second quarter may make the economy look better than it actually is. Why it matters: The US economy is large and resilient, and it has continued to support hundreds of thousands new jobs each month for years. But if Americans are getting cold feet, things could take a turn for the worse. Fed decision Trump has repeatedly — and publicly — berated Fed Chair Jerome Powell for not lowering the bank's interest rate (their recent détente notwithstanding), but the central bank is overwhelmingly expected to hold rates steady Wednesday at the conclusion of its two-day monetary policy meeting. In an unusual kink, two governors are expected to vote against the consensus of the board, which hasn't happened in three decades. With the job market still relatively strong, most Fed officials have said the economy can withstand higher rates for the time being. Meanwhile, they want to wait to see how Trump's policies of high tariffs and deportation of foreign workers impact inflation and the labor market. Why it matters: The bank is widely expected to start cutting its key overnight lending rate in September — a good sign for Americans hoping to borrow money, and especially for first-time homebuyers, who have been effectively locked out of the market with mortgage rates close to 7%. Inflation The Fed's favorite inflation gauge, the Personal Consumption Expenditures index, has been creeping higher — moving further away from its 2% goal in recent months. That's just one factor behind the central bank's position on rate cuts. Why it matters: Shoppers have been pulling forward purchases, including back-to-school items, to mitigate expected higher prices, but the July data will likely still bear the fingerprints of Trump's tumultuous trade policy: Items like furniture and toys are starting to reflect elevated costs as pre-tariff inventory is depleted. Trade deadline Trump's pause on the hefty and unpopular tariffs he rolled out in April expires on August 1. In the intervening period, the White House has scrambled to make deals with a slew of partners, announcing preliminary arrangements with the UK, China, Vietnam, Indonesia, the Philippines and Japan. And on Sunday, Trump announced a framework for an EU deal. As the final deadline approaches, Trump said Friday he would be sending out letters to roughly 200 countries this week unilaterally setting a range of tariff rates. 'It's basically going to say, you're going to pay 10%, you're going to pay 15%, you're going to pay maybe less, I don't know,' Trump told reporters before he left for a trip to Scotland. US markets are 'very, very fixated' on the levels that are set, and an effective tariff rate beyond 20% on major trading partners could trigger a downturn on Wall Street, one analyst told CNN. Why it matters: Trump's tariffs that are currently in effect have raised the effective US tariff rate — the average tax that US importers pay on foreign goods — from around 2% to 18%, the highest since 1934, economists at Yale's Budget Lab said in a recent report. That works out to $2,400 a year in added costs for the average American household. The US economy and markets have been able to withstand that so far. A considerably higher tariff rate could put that to the test. Trade negotiations Talks with China are ongoing, however. Treasury Secretary Scott Bessent is set to meet Monday and Tuesday with Chinese officials to iron out the details of the framework the two countries agreed upon at their London and Geneva meetings. Trump in April slapped a 145% tariff on imports from China, prompting Beijing to respond with a 125% tariff on imports from the United States. That effectively created a total embargo between the world's two largest economies before they agreed on a pause until August 12. Meanwhile, on Thursday, the US Court of Appeals will hear oral arguments about whether Trump can use his emergency powers to levy tariffs after a lower court ruled he had exceeded his authority in doing so. Why it matters: One of the Trump administration's goals is to shift China towards a more consumer-driven domestic economy, thereby reducing global oversupply of its manufactured goods. While it's unlikely that the United States will dramatically reshape Chinese President Xi Jinping's economic policy, small changes could open some of China's market to US manufacturers, while helping to increase American factory jobs. Jobs report Trump has promised a 'Made in America' revival, but the July jobs report is expected to show that average monthly employment gains have dropped to a level not seen since 2010 (excluding the pandemic-era losses). The labor force has shrunk in recent months, a potential indication of how anti-immigrant rhetoric and mass deportations are weighing on employment. In addition, the most recent report showed that the manufacturing sector lost jobs for the second-straight month — a murky development for one of Trump's benchmark economic priorities. Why it matters: America's labor market has been its strong suit for years, routinely defying expectations since the pandemic. But it's showing cracks. Americans who lose their job are now staying unemployed for longer as businesses stall on making decisions, including hiring, as the trade war continues to raise costs.
Yahoo
2 hours ago
- Yahoo
Stock market today: Dow, S&P 500, Nasdaq futures climb as Trump-EU trade deal kicks off huge week in markets
US stock futures edged higher Sunday evening as investors braced for a packed week featuring earnings from Big Tech heavyweights, a Federal Reserve meeting, inflation data, and President Trump's Aug. 1 deadline to lock in key trade deals. Futures tied to the Dow Jones Industrial Average (YM=F) were up about 0.4%, while S&P 500 futures (ES=F) also gained 0.4%. Nasdaq 100 futures (NQ=F) rose 0.5%. The rally follows a strong week on Wall Street. All three major indexes posted gains Friday, with the S&P 500 closing at an all-time high for a fifth straight session. Market sentiment got a boost Sunday night after the US and European Union reached a deal to reduce tariffs to 15% on EU goods, easing tensions with one of America's largest trading partners. Trump had previously been threatening imposing 30% tariffs from Friday. Read more: The latest on Trump's tariffs Investor eyes are now turning to a jam-packed week on Wall Street. Heavyweight earnings highlight the most intense stretch of the season, with more than 150 S&P 500 companies set to report. Meta Platforms (META) and Microsoft (MSFT) lead off Wednesday, followed by Amazon (AMZN) and Apple (AAPL) on Thursday. Read more: Full earnings coverage in our live blog Beyond earnings, the Fed takes center stage. The central bank kicks off a two-day meeting Tuesday, with a decision expected Wednesday afternoon. While rates are widely expected to remain in the 4.25%-4.50% range, traders will be listening closely for any signs that policymakers are warming to a possible rate cut in September. All this is occurring alongside legal battles to open up the Fed's meetings to investor eyes, as well as Trump's general pressure on the central bank and Chair Jerome Powell. On the data front, inflation and labor will be in the spotlight. Thursday's release of the personal consumption expenditures (PCE) index, the Fed's preferred inflation gauge, is forecast to show a modest uptick in both monthly and annual readings. Also on deck: a flurry of jobs data. Investors will get a read on labor market moves through Tuesday's JOLTS report, Wednesday's ADP private payrolls, and Friday's July employment report. Sign in to access your portfolio
