Existing law establishes a program for the issuance of transferable tax credits by the Office of Economic Development to the production company of a motion picture or other qualified production, based upon qualified direct production expenditures made for the purchase of personal property or services from a Nevada business. (NRS 360.758-360.7598) This bill revises provisions governing these transferable tax credits and enacts the Nevada Studio Infrastructure Jobs and Workforce Training Act to authorize film infrastructure transferable tax credits for qualified productions produced at the site of the Summerlin Production Studios Project. Sections 1-16 of this bill enact the Nevada Studio Jobs and Workforce Training Act, which provides film infrastructure transferable tax credits for production companies located within the Summerlin Production Studios Project, as defined in section 8. Section 9 requires the Office of Economic Development to enter into a development agreement with the lead participant of the Project to establish: (1) certain criteria that the Project is required to satisfy in exchange for production companies located at the Project to be eligible for film infrastructure transferable tax credits; and (2) certain requirements for new capital investment in this State and the generation of direct production expenditures in this State, which the Project must meet, with certain exceptions, to avoid penalties specified in section 9. Section 10: (1) authorizes production companies located at the Project to apply, on or after June 1, 2026, to the Office for film infrastructure transferable tax credits for qualified productions produced, in whole or in part, at the Project; and (2) authorizes such credits to be used against the modified business tax, insurance premium tax or gaming license fee, or any combination of these taxes and fees. Section 11 establishes the qualified production expenditures which are the basis for calculating the amount of film infrastructure transferable tax credits, including, without limitation: (1) purchases and rentals of property or services from a Nevada business; (2) wages and fringe benefits paid to employees who are Nevada residents or other personnel who perform services in this State on the qualified production; (3) certain compensation paid to producers in their capacity as producers; and (4) amounts paid to personal service corporations for the services of certain persons on the qualified production. Section 12 of this bill provides that the base amount of film infrastructure transferable tax credits is 30 percent of the amount of qualified direct production expenditures calculated under section 11, with certain reductions if the production company does not satisfy certain criteria for employing Nevada residents as below-the-line personnel or employing or offering training or work opportunities to members of traditionally underrepresented groups. Section 13: (1) limits the total amount of film infrastructure transferable tax credits issued pursuant to sections 1-16 to $95,000,000 for each fiscal year beginning on or after July 1, 2028; and (2) prohibits the approval of an application for film infrastructure transferable tax credits if the application is submitted in a fiscal year that begins on or after July 1, 2043. Section 14 requires a production company to: (1) commence principal photography within a certain period of time after the Office approves an application for a certificate of eligibility for film infrastructure transferable tax credits; (2) complete the qualified production within 18 months after the date of commencement of principal photography, except that the Office may extend this period for not more than 6 months; and (3) submit certain required information within the required period. Section 15 requires a production company to repay film infrastructure transferable tax credits under certain circumstances. Section 15.7 requires the lead participant in the Project to submit certain reports to the Governor, the Legislature and the Office, and requires the Office to post such reports on its Internet website. Section 16 requires certain reports to be made to the Legislature concerning film infrastructure transferable tax credits. Sections 17-25 of this bill make various changes to the existing law governing the noninfrastructure transferable tax credits for motion picture and other qualified productions. (NRS 360.758-360.7598) Section 17 changes references to “extras” in a qualification production to “background actors.” Section 18: (1) provides that digital media productions are qualified productions for the purposes of eligibility for film infrastructure transferable tax credits and noninfrastructure transferable tax credits; and (2) clarifies that media productions solely produced for social media are not eligible for such transferable tax credits. Section 19 revises the criteria to be eligible for noninfrastructure transferable tax credits to be the same as the criteria for film infrastructure transferable tax credits by: (1) removing the requirement that a certain percentage of direct production expenditures be incurred in this State and, instead, requiring that at least 50 percent of the total principal photography days take place in this State or a certain amount of qualified direct production expenditures be incurred in this State; and (2) requiring a production company to have a workforce plan that establishes certain goals and provide to the Office a final assessment of whether the production company met or made a good faith effort to meet those goals. Section 20 revises the expenditures and costs that may serve as a basis for noninfrastructure transferable tax credits. Section 21: (1) increases the base amount of transferable tax credits from 15 percent of the qualified direct production expenditures to 30 percent of the qualified direct production expenditures, for an application submitted in each fiscal year beginning on or after July 1, 2028, and ending before July 1, 2043; and (2) provides for certain reductions to that base amount during that period. Section 22 makes certain provisions of existing law relating to the calculation of noninfrastructure transferable tax credits inapplicable for period beginning on July 1, 2028, and ending on June 30, 2043. Section 23 temporarily increases from $10,000,000 to $25,000,000 the total amount of noninfrastructure transferable tax credits for motion picture and other qualified productions that may be issued under the existing program for each fiscal year beginning on or after July 1, 2028, until June 30, 2043. Sections 24 and 25 make conforming changes so that noninfrastructure transferable tax credits are administered and reported in the same manner as film infrastructure transferable tax credits. Section 15.3 requires the Clark County Board of County Commissioners to create a production studio entertainment district for the purpose of enhancing early childhood education opportunities, including prekindergarten, for children in the Clark County School District. Under section 15.3, the boundaries of the district are required to be entirely within the unincorporated areas of Clark County and include only parcels of land that are located within the boundaries of the Summerlin Production Studios Project other than parcels on which a business holding a gaming license is located. Section 15.3 requires certain taxes on transient lodging, certain property taxes and certain sales and use taxes imposed in the district to be pledged and distributed to the Clark County School District and used by the Clark County School District solely for the purposes of prekindergarten programs in the Clark County School District. Finally, section 15.3 requires the Clark County School District to submit annual reports to the Office concerning the use of money distributed to Clark County School District under section 15.3. Sections 26-33 of this bill establish a program to provide grants to certain organizations that provide education and vocational training for workforce development for the production of motion pictures and other qualified productions. Section 31 establishes the Account for Nevada Film, Media and Related Technology Education and Vocational Training for the purpose of allocating money to certain entities and organizations that provide education and vocational training for such workforce development. Sections 10 and 19 require a production company that is issued transferable tax credits for a qualified production to pay to the Office an amount of money equal to 1 percent of the amount of transferable tax credits issued to the qualified production, and requires the Office to deposit that money with the State Treasurer for credit to the Account. Section 32 creates and provides for the composition of the Board for Nevada Film, Media and Related Technology Education and Vocational Training within the Office of Economic Development. Section 33: (1) requires the Board to establish the procedure for a person or entity to apply for a grant of money from the Account, the criteria to be used to determine whether to approve an application for a grant from the Account to an applicant and the requirements for reports by recipients of such grants concerning the use of the grants; (2) prohibits the making of a grant from the Account unless the Board approves the application for the grant; and (3) requires a recipient of a grant from the Account to adopt and implement a community benefits program that satisfies certain requirements.

Statutes affected:
As Introduced: 360.7582, 360.7586, 360.759, 360.7591, 360.7592, 360.7593, 360.7594, 360.7595, 360.7598
Reprint 1: 360.7582, 360.7586, 360.759, 360.7591, 360.7592, 360.7593, 360.7594, 360.7595, 360.7598
Reprint 2: 360.7582, 360.7586, 360.759, 360.7591, 360.7592, 360.7593, 360.7594, 360.7595, 360.7598
BDR: 360.7582, 360.7586, 360.759, 360.7591, 360.7592, 360.7593, 360.7594, 360.7595, 360.7598