The State of Incentives in Utah

Recently, Dale McKeel, a SAG-AFTRA member in Utah serving on the Arizona-Utah Local Communications Committee, spoke with Jeff Johnson, president of the Motion Picture Association of Utah (MPAU), about incentives in the state and SB49, a bill that modifies provisions related to motion picture incentives.

NOTE: Since this interview, SB49 became law and, starting July 1, 2022, the Utah Motion Picture Incentive Program will include an additional $12 million in tax credits earmarked for productions that shoot 75% of production days in select rural counties for the next two years. For more information on Utah’s incentive program, visit Motion Picture Incentive Program.

SAG-AFTRA: What is the MPAU and what is its role with the Motion Picture Incentive Program?

MPAU: We are a lobbyist group. We are a group of actors, filmmakers, directors, producers, vendors and people who have always wanted to see film grow in Utah. We were formed in 2001. The late, great producer Don Schain was our first president. We started to see work diminish here from what we had seen in the 1990s because Canada was doing tax incentives. We needed to find out how to get our state government behind film production in Utah, and we’ve been at it ever since. This year, we went in and did a financial study with consultant Olsberg SPI. The study was done to show our legislators that tax incentives for film really do work. This year, our focus is an amendment that would get the rural cap taken off, which is a huge deal if we can make it happen.

SAG-AFTRA: What do you mean by the ‘rural cap’?

MPAU: Right now, we have ongoing funds that are capped at about $8.3 million. That is used and gone by the end of the first quarter. It is spent because there are that many films and television shows that want to shoot here. We couldn’t keep up with Yellowstone or High School Musical. We couldn’t offer enough of an incentive to keep them here. It wasn’t that they did not want to be here. The finances of filmmaking now is ‘What incentive do we get where we shoot?’ That means, until we have more money in the program, we cannot have these bigger shows. It just won’t happen. Our governor is from rural Utah. He knows how hard they have been hit by COVID. He knows how badly they need money flowing into those rural counties. This amendment would lift the cap for rural counties. Yellowstone would still be here if this amendment was in place, as they shot in rural counties.

SAG-AFTRA: In the Motion Picture Incentive Program, there is a ‘level up’ of an additional 5% if a production hires 75% of its cast and crew from Utah. Is the extra 5% enough to entice productions to hire more people from Utah?

MPAU: The way the incentive works is that unless you spend money in Utah, you don’t get an incentive for it. Right now, there is a big story running about Kevin Costner wanting to bring five films to Utah. That would be great for Utah, and it would be amazing. But Kevin Costner’s wages would not get the incentive because he is not a resident of Utah. So, there is a natural idea of wanting to hire locally, first off, because of that 5% kicker, but also because you don’t get incentive for what you don’t spend in Utah. If you spend it on hotels, you get it, because it's in Utah. If you spend it on car rentals in Utah, you get it. If you spend it on wages for local crew and local actors, you get it. If you go out of state and bring in an actor or crew member, you don’t get the incentive on that person. Productions would rather have 25% over 20% any day. They are always trying to hit those numbers.

SAG-AFTRA: In the whiteboard video on the MPAU website, it says a production must spend $500,000 in the state to qualify. Can you clarify what that means?

MPAU: This is a rebate program. The production has to prove they spent the money before the state ever cuts a check. All productions have an accountant that keeps track of expenses. They keep track of their Utah spend. Post-production, they take those numbers to a CPA in Utah. That CPA does an audit of those numbers to ensure that money was spent in Utah. After the audit confirms the production numbers, that is submitted to the state. After the state certifies everything, only then is a check cut to the production. They absolutely have to spend their money here before they get their incentive back.

SAG-AFTRA: So, a production with a budget of less than $500,000 would not be able to qualify for this?

MPAU: They would not. Not for the tax incentive. There is a cash program that helps local filmmakers on the low budget end. The MPAU wants to see local filmmakers flourish, as well. However, with the resources we have, we need to focus more on the bigger programs so that, in the long game, we can help the smaller budgeted ones as well.

SAG-AFTRA: How can we SAG-AFTRA members in Utah help in the effort?

MPAU: You can become a member of the MPAU!

SAG-AFTRA: Thank you and MPAU for all you are doing to bring more work to Utah. 

MPAU: No problem! Anything I can do to help SAG-AFTRA, please let me know.