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Maryland Senate Bill SB452

Maryland 2023 Regular Session

Maryland Senate Bill SB452 Compare Versions

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1- WES MOORE, Governor Ch. 434
21
3-– 1 –
4-Chapter 434
5-(Senate Bill 452)
62
7-AN ACT concerning
3+EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4+ [Brackets] indicate matter deleted from existing law.
5+ Underlining indicates amendments to bill.
6+ Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7+amendment.
8+ Italics indicate opposite chamber/conference committee amendments.
9+ *sb0452*
810
9-Income Tax – Film Production Activity Income Tax Credit – Alterations and
10-Maryland Entertainment Council
11+SENATE BILL 452
12+Q3 (3lr1286)
13+ENROLLED BILL
14+— Budget and Taxation/Ways and Means —
15+Introduced by Senators Griffith, Corderman, Elfreth, Guzzone, Jackson, King,
16+Klausmeier, Muse, Salling, M. Washington, and Watson Watson, Bailey,
17+Benson, Hester, Hettleman, McCray, Rosapepe, and Zucker
1118
12-FOR the purpose of expanding eligibility for the credit against the State income tax for
13-certain film production activities to include documentaries and talk, reality, and
14-game shows; altering the definition of “total direct costs” to include certain
15-compensation for certain individuals; increasing the percentages of total direct costs
16-that qualify for the tax credit; establishing the Maryland Entertainment Council to
17-study and make recommendations regarding Maryland’s film, television, and
18-entertainment industry; altering the aggregate amount of tax credit certificates that
19-the Secretary of Commerce may issue each fiscal year; and generally relating to the
20-film production activity tax credit and the Maryland Entertainment Council.
19+Read and Examined by Proofreaders:
2120
22-BY repealing and reenacting, with amendments,
23- Article – Tax – General
24-Section 10–730
25- Annotated Code of Maryland
26- (2022 Replacement Volume)
21+_______________________________________________
22+Proofreader.
23+_______________________________________________
24+Proofreader.
2725
28- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
29-That the Laws of Maryland read as follows:
26+Sealed with the Great Seal and presented to the Governor, for his approval this
3027
31-Article – Tax – General
28+_______ day of _______________ at ________________________ o’clock, ________M.
3229
33-10–730.
30+______________________________________________
31+President.
3432
35- (a) (1) In this section the following words have the meanings indicated.
33+CHAPTER ______
3634
37- (2) “Department” means the Department of Commerce.
35+AN ACT concerning 1
3836
39- (3) “Digital animation project” means the creation, development, and
40-production of computer–generated animation content for distribution or exhibition to the
41-general public.
37+Income Tax – Film Production Activity Income Tax Credit – Alterations and 2
38+Maryland Entertainment Council 3
4239
43- (4) (i) “Film production activity” means:
40+FOR the purpose of expanding eligibility for the credit against the State income tax for 4
41+certain film production activities to include documentaries and talk, reality, and 5
42+game shows; altering the definition of “total direct costs” to include certain 6
43+compensation for certain individuals; increasing the percentages of total direct costs 7
44+that qualify for the tax credit; establishing the Maryland Entertainment Council to 8
45+study and make recommendations regarding Maryland’s film, television, and 9
46+entertainment industry; altering the aggregate amount of tax credit certificates that 10
47+the Secretary of Commerce may issue each fiscal year; and generally relating to the 11
48+film production activity tax credit and the Maryland Entertainment Council. 12
49+ 2 SENATE BILL 452
4450
45- 1. the production of a film or video project that is intended
46-for nationwide commercial distribution; and
4751
48- 2. for a television series, each season of the television series.
49- Ch. 434 2023 LAWS OF MARYLAND
52+BY repealing and reenacting, with amendments, 1
53+ Article – Tax – General 2
54+Section 10–730 3
55+ Annotated Code of Maryland 4
56+ (2022 Replacement Volume) 5
5057
51-– 2 –
52- (ii) “Film production activity” includes the production of:
58+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 6
59+That the Laws of Maryland read as follows: 7
5360
54- 1. a feature film;
61+Article – Tax – General 8
5562
56- 2. a television project;
63+10–730. 9
5764
58- 3. a commercial;
65+ (a) (1) In this section the following words have the meanings indicated. 10
5966
60- 4. a corporate film;
67+ (2) “Department” means the Department of Commerce. 11
6168
62- 5. a music video; [or]
69+ (3) “Digital animation project” means the creation, development, and 12
70+production of computer–generated animation content for distribution or exhibition to the 13
71+general public. 14
6372
64- 6. a digital animation project;
73+ (4) (i) “Film production activity” means: 15
6574
66- 7. A DOCUMENTARY ; OR OR
75+ 1. the production of a film or video project that is intended 16
76+for nationwide commercial distribution; and 17
6777
68- 8. A TALK, REALITY, OR GAME SHOW ; OR
78+ 2. for a television series, each season of the television series. 18
6979
70- 9. A LIVE TO TAPE EVENT .
80+ (ii) “Film production activity” includes the production of: 19
7181
72- (iii) “Film production activity” does not include production of:
82+ 1. a feature film; 20
7383
74- 1. a student film;
84+ 2. a television project; 21
7585
76- 2. a noncommercial personal video;
86+ 3. a commercial; 22
7787
78- 3. a sports broadcast;
88+ 4. a corporate film; 23
7989
80- 4. a broadcast of a live event;
90+ 5. a music video; [or] 24
8191
82- 5. [a talk show;
92+ 6. a digital animation project; 25
8393
84- 6.] a video, computer, or social networking game;
94+ 7. A DOCUMENTARY ; OR OR 26
8595
86- [7.] 6. pornography;
96+ 8. A TALK, REALITY, OR GAME SHOW ; OR 27
97+ SENATE BILL 452 3
8798
88- [8.] 7. an infomercial;
8999
90- [9.] 8. a digital project or an animation project other than a
91-digital animation project; or
100+ 9. A LIVE TO TAPE EVENT . 1
92101
93- [10.] 9. a multimedia project.
102+ (iii) “Film production activity” does not include production of: 2
94103
95- (5) “Maryland small or independent film entity” means a qualified film
96-production entity that: WES MOORE, Governor Ch. 434
104+ 1. a student film; 3
97105
98-– 3 –
106+ 2. a noncommercial personal video; 4
99107
100- (i) has been incorporated in Maryland for at least 3 months;
108+ 3. a sports broadcast; 5
101109
102- (ii) is independently owned and operated;
110+ 4. a broadcast of a live event; 6
103111
104- (iii) is not a subsidiary of another entity;
112+ 5. [a talk show; 7
105113
106- (iv) is not dominant in its field of operation;
114+ 6.] a video, computer, or social networking game; 8
107115
108- (v) employs 25 or fewer full–time employees; and
116+ [7.] 6. pornography; 9
109117
110- (vi) employs Maryland residents as at least 40% of its workforce in
111-the film production activity.
118+ [8.] 7. an infomercial; 10
112119
113- (6) “Pornography” means any production for which records are required to
114-be maintained under § 2257 of Title 18, U.S.C., with respect to any performer in such
115-production engaging in sexually explicit conduct.
120+ [9.] 8. a digital project or an animation project other than a 11
121+digital animation project; or 12
116122
117- (7) “Qualified film production entity” means an entity that:
123+ [10.] 9. a multimedia project. 13
118124
119- (i) is carrying out a film production activity; and
125+ (5) “Maryland small or independent film entity” means a qualified film 14
126+production entity that: 15
120127
121- (ii) the Secretary determines to be eligible for the tax credit under
122-this section in accordance with subsection (c) of this section.
128+ (i) has been incorporated in Maryland for at least 3 months; 16
123129
124- (8) “Secretary” means the Secretary of Commerce.
130+ (ii) is independently owned and operated; 17
125131
126- (9) “Television series” means a group of program episodes intended for
127-television broadcast or transmission with a common series title, with or without a
128-predetermined number of episodes, and shall include a miniseries and a pilot episode
129-produced for an intended television series.
132+ (iii) is not a subsidiary of another entity; 18
130133
131- (10) (i) “Total direct costs”, with respect to a film production activity,
132-means the total costs incurred in the State that are necessary to carry out the film
133-production activity.
134+ (iv) is not dominant in its field of operation; 19
134135
135- (ii) “Total direct costs” includes costs incurred for:
136+ (v) employs 25 or fewer full–time employees; and 20
136137
137- 1. employee wages and benefits;
138+ (vi) employs Maryland residents as at least 40% of its workforce in 21
139+the film production activity. 22
138140
139- 2. fees for services;
141+ (6) “Pornography” means any production for which records are required to 23
142+be maintained under § 2257 of Title 18, U.S.C., with respect to any performer in such 24
143+production engaging in sexually explicit conduct. 25
140144
141- 3. acquiring or leasing property; [and]
145+ (7) “Qualified film production entity” means an entity that: 26 4 SENATE BILL 452
142146
143- 4. SALARIES, WAGES, OR OTHER COMPENSATIO N FOR
144-WRITERS, DIRECTORS, OR PRODUCERS DOMICILED IN THE STATE; AND Ch. 434 2023 LAWS OF MARYLAND
145147
146-– 4 –
147148
148- [4.] 5. any other expense necessary to carry out a film
149-production activity, including costs associated with:
149+ (i) is carrying out a film production activity; and 1
150150
151- A. set construction and operation;
151+ (ii) the Secretary determines to be eligible for the tax credit under 2
152+this section in accordance with subsection (c) of this section. 3
152153
153- B. wardrobe, makeup, and related services;
154+ (8) “Secretary” means the Secretary of Commerce. 4
154155
155- C. photography and sound synchronization, lighting, and
156-related services and materials;
156+ (9) “Television series” means a group of program episodes intended for 5
157+television broadcast or transmission with a common series title, with or without a 6
158+predetermined number of episodes, and shall include a miniseries and a pilot episode 7
159+produced for an intended television series. 8
157160
158- D. editing and related services, including film processing,
159-transfers of film to tape or digital format, sound mixing, computer graphic services, special
160-effects services, and animation services;
161+ (10) (i) “Total direct costs”, with respect to a film production activity, 9
162+means the total costs incurred in the State that are necessary to carry out the film 10
163+production activity. 11
161164
162- E. salary, wages, and other compensation including related
163-benefits, for work performed in the State, paid to persons employed in the production;
165+ (ii) “Total direct costs” includes costs incurred for: 12
164166
165- F. rental of facilities in the State and equipment used in the
166-State;
167+ 1. employee wages and benefits; 13
167168
168- G. leasing of vehicles;
169+ 2. fees for services; 14
169170
170- H. food and lodging;
171+ 3. acquiring or leasing property; [and] 15
171172
172- I. music, if performed, composed, or recorded by a Maryland
173-musician or published by a person or company domiciled in Maryland;
173+ 4. SALARIES, WAGES, OR OTHER COMPENSATIO N FOR 16
174+WRITERS, DIRECTORS, OR PRODUCERS DOMICILED IN THE STATE; AND 17
174175
175- J. travel expenses incurred to bring persons employed, either
176-directly or indirectly, in the production of the project to Maryland, but not including
177-expenses of these persons departing from Maryland; and
176+ [4.] 5. any other expense necessary to carry out a film 18
177+production activity, including costs associated with: 19
178178
179- K. legal and accounting services performed by attorneys or
180-accountants licensed in Maryland.
179+ A. set construction and operation; 20
181180
182- (iii) “Total direct costs” does not include any salary, wages, or other
183-compensation for:
181+ B. wardrobe, makeup, and related services; 21
184182
185- 1. personal services of an individual who receives more than
186-$500,000 in salary, wages, or other compensation for personal services in connection with
187-any film production activity; or
183+ C. photography and sound synchronization, lighting, and 22
184+related services and materials; 23
188185
189- 2. EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS
190-PARAGRAPH , writers, directors, or producers.
191- WES MOORE, Governor Ch. 434
186+ D. editing and related services, including film processing, 24
187+transfers of film to tape or digital format, sound mixing, computer graphic services, special 25
188+effects services, and animation services; 26
192189
193-– 5 –
194- (b) (1) A qualified film production entity may claim a credit against the State
195-income tax for film production activities in the State in an amount equal to the amount
196-stated in the final tax credit certificate approved by the Secretary for film production
197-activities.
190+ E. salary, wages, and other compensation including related 27
191+benefits, for work performed in the State, paid to persons employed in the production; 28
192+ SENATE BILL 452 5
198193
199- (2) If the tax credit allowed under this section in any taxable year exceeds
200-the total tax otherwise payable by the qualified film production entity for that taxable year,
201-the qualified film production entity may claim a refund in the amount of the excess.
202194
203- (c) (1) Before beginning a film production activity, a film production entity
204-shall submit to the Department an application to qualify as a film production entity.
195+ F. rental of facilities in the State and equipment used in the 1
196+State; 2
205197
206- (2) The application shall describe the anticipated film production activity,
207-including:
198+ G. leasing of vehicles; 3
208199
209- (i) the projected total budget;
200+ H. food and lodging; 4
210201
211- (ii) the estimated number of Maryland resident and out–of–state
212-employees and total wages to be paid; and
202+ I. music, if performed, composed, or recorded by a Maryland 5
203+musician or published by a person or company domiciled in Maryland; 6
213204
214- (iii) the anticipated dates for carrying out the major elements of the
215-film production activity.
205+ J. travel expenses incurred to bring persons employed, either 7
206+directly or indirectly, in the production of the project to Maryland, but not including 8
207+expenses of these persons departing from Maryland; and 9
216208
217- (3) Except as provided in subsection (h) of this section, to qualify as a film
218-production entity, the estimated total direct costs incurred in the State must exceed
219-$250,000.
209+ K. legal and accounting services performed by attorneys or 10
210+accountants licensed in Maryland. 11
220211
221- (4) The application shall include any other information required by the
222-Secretary.
212+ (iii) “Total direct costs” does not include any salary, wages, or other 12
213+compensation for: 13
223214
224- (5) For a film production entity with total direct costs that exceed $250,000,
225-the Secretary may require the information provided in an application to be verified by an
226-independent auditor selected and paid for by the film production entity seeking
227-certification.
215+ 1. personal services of an individual who receives more than 14
216+$500,000 in salary, wages, or other compensation for personal services in connection with 15
217+any film production activity; or 16
228218
229- (6) The Secretary shall:
219+ 2. EXCEPT AS PROVIDED IN S UBPARAGRAPH (II) OF THIS 17
220+PARAGRAPH , writers, directors, or producers. 18
230221
231- (i) determine if the film production entity qualifies for the credit
232-under this section; and
222+ (b) (1) A qualified film production entity may claim a credit against the State 19
223+income tax for film production activities in the State in an amount equal to the amount 20
224+stated in the final tax credit certificate approved by the Secretary for film production 21
225+activities. 22
233226
234- (ii) notify the Comptroller of the estimated amount of total direct
235-costs and the taxable year the credit will be claimed.
227+ (2) If the tax credit allowed under this section in any taxable year exceeds 23
228+the total tax otherwise payable by the qualified film production entity for that taxable year, 24
229+the qualified film production entity may claim a refund in the amount of the excess. 25
236230
237- (d) (1) After completion of the film production activity, a qualified film
238-production entity shall apply to the Department for a tax credit certificate.
239- Ch. 434 2023 LAWS OF MARYLAND
231+ (c) (1) Before beginning a film production activity, a film production entity 26
232+shall submit to the Department an application to qualify as a film production entity. 27
240233
241-– 6 –
242- (2) The application shall be on a form required by the Secretary and shall
243-include:
234+ (2) The application shall describe the anticipated film production activity, 28
235+including: 29
244236
245- (i) proof of the total direct costs that qualify for the tax credit; and
237+ (i) the projected total budget; 30
246238
247- (ii) the number of employees hired and wages paid.
239+ (ii) the estimated number of Maryland resident and out–of–state 31
240+employees and total wages to be paid; and 32
241+ 6 SENATE BILL 452
248242
249- (3) Subject to subsections (f) and (h) of this section, the Secretary shall
250-determine the total direct costs that qualify for the tax credit and issue a tax credit
251-certificate for:
252243
253- (i) except as provided in item (ii) of this paragraph, [25%] 28% of
254-the total direct costs that qualify for the tax credit; and
244+ (iii) the anticipated dates for carrying out the major elements of the 1
245+film production activity. 2
255246
256- (ii) for a television series, [27%] 30% of the total direct costs that
257-qualify for the tax credit.
247+ (3) Except as provided in subsection (h) of this section, to qualify as a film 3
248+production entity, the estimated total direct costs incurred in the State must exceed 4
249+$250,000. 5
258250
259- (e) In accordance with § 2.5–109 of the Economic Development Article, the
260-Department shall submit a report on film production activity in the State and the economic
261-benefits to the State resulting from film production activity during the reporting period.
251+ (4) The application shall include any other information required by the 6
252+Secretary. 7
262253
263- (f) (1) Except as provided in paragraph (2) of this subsection, the Secretary
264-may not issue tax credit certificates for credit amounts in the aggregate totaling more than:
254+ (5) For a film production entity with total direct costs that exceed $250,000, 8
255+the Secretary may require the information provided in an application to be verified by an 9
256+independent auditor selected and paid for by the film production entity seeking 10
257+certification. 11
265258
266- (i) for fiscal year 2014, $25,000,000;
259+ (6) The Secretary shall: 12
267260
268- (ii) for fiscal year 2015, $7,500,000;
261+ (i) determine if the film production entity qualifies for the credit 13
262+under this section; and 14
269263
270- (iii) for fiscal year 2016, $7,500,000;
264+ (ii) notify the Comptroller of the estimated amount of total direct 15
265+costs and the taxable year the credit will be claimed. 16
271266
272- (iv) for fiscal year 2019, $8,000,000;
267+ (d) (1) After completion of the film production activity, a qualified film 17
268+production entity shall apply to the Department for a tax credit certificate. 18
273269
274- (v) for fiscal year 2020, $11,000,000; [and]
270+ (2) The application shall be on a form required by the Secretary and shall 19
271+include: 20
275272
276- (vi) for fiscal [year] YEARS 2021 [and each fiscal year thereafter]
277-THROUGH 2023 2024 2023, $12,000,000;
273+ (i) proof of the total direct costs that qualify for the tax credit; and 21
278274
279- (VII) FOR FISCAL YEAR 2024, $15,000,000;
275+ (ii) the number of employees hired and wages paid. 22
280276
281- (VIII) FOR FISCAL YEAR 2025, $17,500,000;
277+ (3) Subject to subsections (f) and (h) of this section, the Secretary shall 23
278+determine the total direct costs that qualify for the tax credit and issue a tax credit 24
279+certificate for: 25
282280
283- (VII) (IX) FOR FISCAL YEAR 2024 YEARS 2025 THROUGH 2028
284-YEAR 2026, $25,000,000 $20,000,000; AND
285- WES MOORE, Governor Ch. 434
281+ (i) except as provided in item (ii) of this paragraph, [25%] 28% of 26
282+the total direct costs that qualify for the tax credit; and 27
286283
287-– 7 –
288- (VIII) (X) FOR FISCAL YEAR 2025 2029 2027 AND EACH FISCAL
289-YEAR THEREAFTER , $50,000,000 $12,000,000.
284+ (ii) for a television series, [27%] 30% of the total direct costs that 28
285+qualify for the tax credit. 29
290286
291- (2) If the aggregate credit amounts under the tax credit certificates issued
292-by the Secretary total less than the maximum provided under paragraph (1) of this
293-subsection in any fiscal year, any excess amount may be carried forward and issued under
294-tax credit certificates in a subsequent fiscal year.
287+ (e) In accordance with § 2.5–109 of the Economic Development Article, the 30
288+Department shall submit a report on film production activity in the State and the economic 31
289+benefits to the State resulting from film production activity during the reporting period. 32
290+ SENATE BILL 452 7
295291
296- (3) The Secretary may not issue tax credit certificates for credit amounts
297-totaling more than $10,000,000 in the aggregate for a single film production activity.
298292
299- (4) (i) For fiscal year 2019 and each fiscal year thereafter, the Secretary
300-shall make 10% of the credit amount authorized under paragraph (1) of this subsection
301-available for Maryland small or independent film entities.
293+ (f) (1) Except as provided in paragraph (2) of this subsection, the Secretary 1
294+may not issue tax credit certificates for credit amounts in the aggregate totaling more than: 2
302295
303- (ii) If the total amount of credits applied for by Maryland small or
304-independent film entities is less than the amount made available under subparagraph (i)
305-of this paragraph, the Secretary shall make available the unused amount of credits for use
306-by qualified film production entities.
296+ (i) for fiscal year 2014, $25,000,000; 3
307297
308- (g) (1) Except as provided in paragraph (2) of this subsection, a qualified film
309-production entity that receives a tax credit certificate under this section for a film
310-production activity shall include:
298+ (ii) for fiscal year 2015, $7,500,000; 4
311299
312- (i) for a feature film project, a 5–second long static or animated logo
313-that promotes the State in the end credits before the below–the–line crew crawl for the life
314-of the project and a link to the State’s website on the project’s website;
300+ (iii) for fiscal year 2016, $7,500,000; 5
315301
316- (ii) for a television series project, an embedded 5–second long static
317-or animated logo that promotes the State during each broadcast worldwide for the life of
318-the project and a link to the State’s website on the project’s website; or
302+ (iv) for fiscal year 2019, $8,000,000; 6
319303
320- (iii) for any other project, the State logo at the end of each project and
321-in online promotions.
304+ (v) for fiscal year 2020, $11,000,000; [and] 7
322305
323- (2) In lieu of including a State logo as required under paragraph (1) of this
324-subsection, the qualified film production entity may offer alternative marketing
325-opportunities to be evaluated by the Department to ensure that those opportunities offer
326-equal or greater promotional value to the State.
306+ (vi) for fiscal [year] YEARS 2021 [and each fiscal year thereafter] 8
307+THROUGH 2023 2024 2023, $12,000,000; 9
327308
328- (h) (1) For a Maryland small or independent film entity to qualify as a film
329-production entity:
309+ (VII) FOR FISCAL YEAR 2024, $15,000,000; 10
330310
331- (i) the estimated total direct costs incurred in the State shall exceed
332-$25,000; and
333- Ch. 434 2023 LAWS OF MARYLAND
311+ (VIII) FOR FISCAL YEAR 2025, $17,500,000; 11
334312
335-– 8 –
336- (ii) at least 50% of the filming of the film production activity must
337-occur within the State.
313+ (VII) (IX) FOR FISCAL YEAR 2024 YEARS 2025 THROUGH 2028 12
314+YEAR 2026, $25,000,000 $20,000,000; AND 13
338315
339- (2) The Secretary shall determine the total direct costs that qualify for the
340-tax credit and issue a tax credit certificate to a Maryland small or independent film entity
341-for [25%] 28% of the total direct costs that qualify for the tax credit, not to exceed $125,000.
316+ (VIII) (X) FOR FISCAL YEAR 2025 2029 2027 AND EACH FISCAL 14
317+YEAR THEREAFTER , $50,000,000 $12,000,000. 15
342318
343- (i) The Department and the Comptroller jointly shall adopt regulations to carry
344-out the provisions of this section and to specify criteria and procedures for the application
345-for, approval of, and monitoring of continuing eligibility for the tax credit under this section.
319+ (2) If the aggregate credit amounts under the tax credit certificates issued 16
320+by the Secretary total less than the maximum provided under paragraph (1) of this 17
321+subsection in any fiscal year, any excess amount may be carried forward and issued under 18
322+tax credit certificates in a subsequent fiscal year. 19
346323
347- SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July
348-1, 2023, and shall be applicable to all taxable years beginning after December 31, 2022.
324+ (3) The Secretary may not issue tax credit certificates for credit amounts 20
325+totaling more than $10,000,000 in the aggregate for a single film production activity. 21
349326
350- SECTION 2. AND BE IT FURTHER ENACTED, That:
327+ (4) (i) For fiscal year 2019 and each fiscal year thereafter, the Secretary 22
328+shall make 10% of the credit amount authorized under paragraph (1) of this subsection 23
329+available for Maryland small or independent film entities. 24
351330
352- (a) There is a Maryland Entertainment Council.
331+ (ii) If the total amount of credits applied for by Maryland small or 25
332+independent film entities is less than the amount made available under subparagraph (i) 26
333+of this paragraph, the Secretary shall make available the unused amount of credits for use 27
334+by qualified film production entities. 28
353335
354- (b) (1) Subject to paragraph (2) of this subsection, the Council consists of:
336+ (g) (1) Except as provided in paragraph (2) of this subsection, a qualified film 29
337+production entity that receives a tax credit certificate under this section for a film 30
338+production activity shall include: 31 8 SENATE BILL 452
355339
356- (i) one member of the Senate of Maryland, appointed by the
357-President of the Senate;
358340
359- (ii) one member of the House of Delegates, appointed by the Speaker
360-of the House;
361341
362- (iii) the Governor’s appointed Senior Advisor on Film, Television, and
363-Entertainment; and
342+ (i) for a feature film project, a 5–second long static or animated logo 1
343+that promotes the State in the end credits before the below–the–line crew crawl for the life 2
344+of the project and a link to the State’s website on the project’s website; 3
364345
365- (iv) the following members, appointed by the Governor:
346+ (ii) for a television series project, an embedded 5–second long static 4
347+or animated logo that promotes the State during each broadcast worldwide for the life of 5
348+the project and a link to the State’s website on the project’s website; or 6
366349
367- 1. one expert in the business of the film, television, and
368-entertainment industry, such as an executive, producer, studio representative, or an
369-individual holding a leadership role within the industry;
350+ (iii) for any other project, the State logo at the end of each project and 7
351+in online promotions. 8
370352
371- 2. one expert in workforce development or higher education
372-related to the film, television, and entertainment industry;
353+ (2) In lieu of including a State logo as required under paragraph (1) of this 9
354+subsection, the qualified film production entity may offer alternative marketing 10
355+opportunities to be evaluated by the Department to ensure that those opportunities offer 11
356+equal or greater promotional value to the State. 12
373357
374- 3. one expert in emerging technologies or specialties of the
375-film, television, and entertainment industry, such as an expert in gaming, artificial
376-intelligence, visual effects, animation, post–production, or another related specialty;
358+ (h) (1) For a Maryland small or independent film entity to qualify as a film 13
359+production entity: 14
377360
378- 4. one expert in legal or policy fields specific to the film,
379-television, and entertainment industry;
380- WES MOORE, Governor Ch. 434
361+ (i) the estimated total direct costs incurred in the State shall exceed 15
362+$25,000; and 16
381363
382-– 9 –
383- 5. one representative of the independent film and television
384-community;
364+ (ii) at least 50% of the filming of the film production activity must 17
365+occur within the State. 18
385366
386- 6. one representative of nongovernmental entities or
387-philanthropic institutions that support film, television, or entertainment directly or
388-creative economies more broadly; and
367+ (2) The Secretary shall determine the total direct costs that qualify for the 19
368+tax credit and issue a tax credit certificate to a Maryland small or independent film entity 20
369+for [25%] 28% of the total direct costs that qualify for the tax credit, not to exceed $125,000. 21
389370
390- 7. one representative of organized labor in the entertainment
391-industry.
371+ (i) The Department and the Comptroller jointly shall adopt regulations to carry 22
372+out the provisions of this section and to specify criteria and procedures for the application 23
373+for, approval of, and monitoring of continuing eligibility for the tax credit under this section. 24
392374
393- (2) The Governor may appoint up to three additional individuals as
394-honorary cochairs of the Council who are:
375+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 25
376+1, 2023, and shall be applicable to all taxable years beginning after December 31, 2022. 26
395377
396- (i) individuals with extraordinary cultural capital and commanding
397-significant influence within the film, television, and entertainment industry;
378+ SECTION 2. AND BE IT FURTHER ENACTED, That: 27
398379
399- (ii) business leaders commanding a significant stake within the film,
400-television, and entertainment industry; or
380+ (a) There is a Maryland Entertainment Council. 28
401381
402- (iii) individuals who have defined the current cultural brand of the
403-film, television, and entertainment industry within the State.
382+ (b) (1) Subject to paragraph (2) of this subsection, the Council consists of: 29
404383
405- (3) An individual appointed as an honorary cochair of the Council shall be
406-a nonvoting member of the Council whose responsibilities shall be limited to the promotion
407-and business development of Maryland’s film, television, and entertainment industry.
384+ (i) one member of the Senate of Maryland, appointed by the 30
385+President of the Senate; 31
386+ SENATE BILL 452 9
408387
409- (c) The Senior Advisor on Film, Television, and Entertainment shall chair the
410-Council.
411388
412- (d) The Department of Commerce shall provide staff for the Council.
389+ (ii) one member of the House of Delegates, appointed by the Speaker 1
390+of the House; 2
413391
414- (e) A member of the Council:
392+ (iii) the Governor’s appointed Senior Advisor on Film, Television, and 3
393+Entertainment; and 4
415394
416- (1) may not receive compensation as a member of the Council; but
395+ (iv) the following members, appointed by the Governor: 5
417396
418- (2) is entitled to reimbursement for expenses under the Standard State
419-Travel Regulations, as provided in the State budget.
397+ 1. one expert in the business of the film, television, and 6
398+entertainment industry, such as an executive, producer, studio representative, or an 7
399+individual holding a leadership role within the industry; 8
420400
421- (f) The Council shall:
401+ 2. one expert in workforce development or higher education 9
402+related to the film, television, and entertainment industry; 10
422403
423- (1) assess Maryland’s existing assets, opportunities, and competitive
424-position within the film, television, and entertainment industry;
404+ 3. one expert in emerging technologies or specialties of the 11
405+film, television, and entertainment industry, such as an expert in gaming, artificial 12
406+intelligence, visual effects, animation, post–production, or another related specialty; 13
425407
426- (2) study:
427- Ch. 434 2023 LAWS OF MARYLAND
408+ 4. one expert in legal or policy fields specific to the film, 14
409+television, and entertainment industry; 15
428410
429-– 10 –
430- (i) Maryland’s State, local, and private assets that currently
431-support Maryland’s film, television, and entertainment industry, including key
432-infrastructure, existing workforce, workforce pipelines, scenic profile, emerging specialties,
433-and independent creative communities;
411+ 5. one representative of the independent film and television 16
412+community; 17
434413
435- (ii) existing State programs, agencies, offices, grant programs, and
436-commissions across State agencies that support the film, television, and entertainment
437-industry;
414+ 6. one representative of nongovernmental entities or 18
415+philanthropic institutions that support film, television, or entertainment directly or 19
416+creative economies more broadly; and 20
438417
439- (iii) models, competitive profiles, methods, and legislation that states
440-have utilized to incentivize necessary infrastructure and workforce to support the film,
441-television, and entertainment industry;
418+ 7. one representative of organized labor in the entertainment 21
419+industry. 22
442420
443- (iv) industry needs, disruptive trends, and emerging technologies
444-within the film, television, and entertainment industry; and
421+ (2) The Governor may appoint up to three additional individuals as 23
422+honorary cochairs of the Council who are: 24
445423
446- (v) complementary industries, aligned businesses, and potential
447-corporate, philanthropic, and other partners for the film, television, and entertainment
448-industry; and
424+ (i) individuals with extraordinary cultural capital and commanding 25
425+significant influence within the film, television, and entertainment industry; 26
449426
450- (3) make recommendations on the development of a coordinated,
451-comprehensive strategic plan to position Maryland as an emerging leader in the film,
452-television, and entertainment industry.
427+ (ii) business leaders commanding a significant stake within the film, 27
428+television, and entertainment industry; or 28
453429
454- (g) On or before December 1, 2023, the Council shall submit a preliminary report
455-to the Governor, the Secretary of Commerce, and, in accordance with § 2–1257 of the State
456-Government Article, the General Assembly that includes:
430+ (iii) individuals who have defined the current cultural brand of the 29
431+film, television, and entertainment industry within the State. 30
457432
458- (1) an assessment of Maryland’s existing infrastructure, creative profile,
459-and core structural advantages that the State is uniquely positioned to leverage;
433+ (3) An individual appointed as an honorary cochair of the Council shall be 31
434+a nonvoting member of the Council whose responsibilities shall be limited to the promotion 32
435+and business development of Maryland’s film, television, and entertainment industry. 33 10 SENATE BILL 452
460436
461- (2) recommendations on how to best utilize existing State offices,
462-commissions, and programs to advance Maryland’s film, television, and entertainment
463-industry and what, if any, additional investments should be made to support these State
464-functions;
465437
466- (3) a clear definition of Maryland’s creative and competitive profile; and
467438
468- (4) recommendations to measure the economic impact of additional
469-investment in the film, television, and entertainment industry.
439+ (c) The Senior Advisor on Film, Television, and Entertainment shall chair the 1
440+Council. 2
470441
471- (h) On or before September 1, 2024, the Council shall submit its final report to
472-the Governor, the Secretary of Commerce, and, in accordance with § 2–1257 of the State
473-Government Article, the General Assembly on:
442+ (d) The Department of Commerce shall provide staff for the Council. 3
474443
475- (1) the matters included in the Council’s preliminary report; WES MOORE, Governor Ch. 434
444+ (e) A member of the Council: 4
476445
477-– 11 –
446+ (1) may not receive compensation as a member of the Council; but 5
478447
479- (2) recommendations regarding the expansion of eligibility for film
480-production incentives, including with respect to live to tape events, and the potential
481-economic impact from that expansion;
448+ (2) is entitled to reimbursement for expenses under the Standard State 6
449+Travel Regulations, as provided in the State budget. 7
482450
483- (2) (3) recommendations to strengthen the structure and funding of the State’s
484-existing film and theatrical production incentives to ensure a greater return on investment
485-on Maryland’s investment in the film, television, and entertainment industry;
451+ (f) The Council shall: 8
486452
487- (3) (4) recommendations for additional State investment to bolster identified
488-specialties and high–leverage growth opportunities in the film, television, and
489-entertainment industry;
453+ (1) assess Maryland’s existing assets, opportunities, and competitive 9
454+position within the film, television, and entertainment industry; 10
490455
491- (4) (5) recommendations to support and grow Maryland’s independent
492-creative community and incentivize export promotions of Maryland–based talent;
456+ (2) study: 11
493457
494- (5) (6) methods to bolster film–, television–, and entertainment–related
495-business development and identify potential industry partnerships;
458+ (i) Maryland’s State, local, and private assets that currently 12
459+support Maryland’s film, television, and entertainment industry, including key 13
460+infrastructure, existing workforce, workforce pipelines, scenic profile, emerging specialties, 14
461+and independent creative communities; 15
496462
497- (6) (7) methods to sustainably grow the film, television, and entertainment
498-workforce and identify potential workforce development and higher education partners;
499-and
463+ (ii) existing State programs, agencies, offices, grant programs, and 16
464+commissions across State agencies that support the film, television, and entertainment 17
465+industry; 18
500466
501- (7) (8) other recommendations, as appropriate, to support and grow the
502-economic impact of Maryland’s film, television, and entertainment industry.
467+ (iii) models, competitive profiles, methods, and legislation that states 19
468+have utilized to incentivize necessary infrastructure and workforce to support the film, 20
469+television, and entertainment industry; 21
503470
504- SECTION 3. AND BE IT FURTHER ENACTED, That it is the intent of the General
505-Assembly that the Department of Commerce encourage Maryland–based film entities to
506-apply for the credit authorized under § 10–730 of the Tax – General Article, as enacted by
507-Section 1 of this Act.
471+ (iv) industry needs, disruptive trends, and emerging technologies 22
472+within the film, television, and entertainment industry; and 23
508473
509- SECTION 3. 4. AND BE IT FURTHER ENACTED, That Section 1 of this Act shall
510-be applicable to all taxable years beginning after December 31, 2022.
474+ (v) complementary industries, aligned businesses, and potential 24
475+corporate, philanthropic, and other partners for the film, television, and entertainment 25
476+industry; and 26
511477
512- SECTION 4. 5. AND BE IT FURTHER ENACTED, That this Act shall take effect
513-July 1, 2023. Section 2 of this Act shall remain effective for a period of 2 years and, at the
514-end of June 30, 2025, Section 2 of this Act, with no further action required by the General
515-Assembly, shall be abrogated and of no further force and effect.
478+ (3) make recommendations on the development of a coordinated, 27
479+comprehensive strategic plan to position Maryland as an emerging leader in the film, 28
480+television, and entertainment industry. 29
516481
517-Approved by the Governor, May 8, 2023.
482+ (g) On or before December 1, 2023, the Council shall submit a preliminary report 30
483+to the Governor, the Secretary of Commerce, and, in accordance with § 2–1257 of the State 31
484+Government Article, the General Assembly that includes: 32 SENATE BILL 452 11
485+
486+
487+
488+ (1) an assessment of Maryland’s existing infrastructure, creative profile, 1
489+and core structural advantages that the State is uniquely positioned to leverage; 2
490+
491+ (2) recommendations on how to best utilize existing State offices, 3
492+commissions, and programs to advance Maryland’s film, television, and entertainment 4
493+industry and what, if any, additional investments should be made to support these State 5
494+functions; 6
495+
496+ (3) a clear definition of Maryland’s creative and competitive profile; and 7
497+
498+ (4) recommendations to measure the economic impact of additional 8
499+investment in the film, television, and entertainment industry. 9
500+
501+ (h) On or before September 1, 2024, the Council shall submit its final report to 10
502+the Governor, the Secretary of Commerce, and, in accordance with § 2–1257 of the State 11
503+Government Article, the General Assembly on: 12
504+
505+ (1) the matters included in the Council’s preliminary report; 13
506+
507+ (2) recommendations regarding the expansion of eligibility for film 14
508+production incentives, including with respect to live to tape events, and the potential 15
509+economic impact from that expansion; 16
510+
511+ (2) (3) recommendations to strengthen the structure and funding of the State’s 17
512+existing film and theatrical production incentives to ensure a greater return on investment 18
513+on Maryland’s investment in the film, television, and entertainment industry; 19
514+
515+ (3) (4) recommendations for additional State investment to bolster identified 20
516+specialties and high–leverage growth opportunities in the film, television, and 21
517+entertainment industry; 22
518+
519+ (4) (5) recommendations to support and grow Maryland’s independent 23
520+creative community and incentivize export promotions of Maryland–based talent; 24
521+
522+ (5) (6) methods to bolster film–, television–, and entertainment–related 25
523+business development and identify potential industry partnerships; 26
524+
525+ (6) (7) methods to sustainably grow the film, television, and entertainment 27
526+workforce and identify potential workforce development and higher education partners; 28
527+and 29
528+
529+ (7) (8) other recommendations, as appropriate, to support and grow the 30
530+economic impact of Maryland’s film, television, and entertainment industry. 31
531+
532+ SECTION 3. AND BE IT FURTHER ENACTED, That it is the intent of the General 32
533+Assembly that the Department of Commerce encourage Maryland–based film entities to 33 12 SENATE BILL 452
534+
535+
536+apply for the credit authorized under § 10–730 of the Tax – General Article, as enacted by 1
537+Section 1 of this Act. 2
538+
539+ SECTION 3. 4. AND BE IT FURTHER ENACTED, That Section 1 of this Act shall 3
540+be applicable to all taxable years beginning after December 31, 2022. 4
541+
542+ SECTION 4. 5. AND BE IT FURTHER ENACTED, That this Act shall take effect 5
543+July 1, 2023. Section 2 of this Act shall remain effective for a period of 2 years and, at the 6
544+end of June 30, 2025, Section 2 of this Act, with no further action required by the General 7
545+Assembly, shall be abrogated and of no further force and effect. 8
546+
547+
548+
549+
550+
551+Approved:
552+________________________________________________________________________________
553+ Governor.
554+________________________________________________________________________________
555+ President of the Senate.
556+________________________________________________________________________________
557+ Speaker of the House of Delegates.