Assembly OKs Tax Credits for Film Work

Hoping to curb the exodus of movie and television shoots to Canada, the California Assembly approved legislation Wednesday to give smaller Hollywood productions a 15% credit against the state wage tax.

The Senate also approved a $9-billion bond to help build a high-speed rail line down the middle of the state, and the Assembly passed a measure to have the state’s minimum wage automatically rise to keep up with inflation.

Numerous other measures were debated Wednesday as the lawmakers rushed to meet the Legislature’s deadline to pass bills from their house of origin by month’s end. All the bills still need to go through the other house, then back to their house of origin for a second approval, and finally must obtain the signature of Gov. Gray Davis before becoming law.

Also on Wednesday, the Assembly passed legislation by Assemblyman Fred Keeley (D-Boulder Creek) to allow welfare recipients to continue going to college at public expense past a time limit imposed by the state’s welfare reforms, and the Senate approved a measure by Senate President Pro Tem John Burton (D-San Francisco) to create an Office of Homelessness.

The bill to target so-called runaway productions to Canada, AB 2747 by Assembly Speaker Herb Wesson (D-Culver City), garnered strong bipartisan support and passed the Assembly 68 to 1.

Focusing on the commercial shoots, television movies and independent films that have been going north to save money, it would give the wage-tax credit to California productions with employee wages between $200,000 and $10 million, provided that at least 50% of the production take place in the state.

Runaway productions have cost California roughly 18,000 jobs in the last year--a 12% drop in such employment, according to Wesson’s office, which has worked on the bill with organized labor.

“This is for the guy that moves the camera. This is for the makeup lady,” Wesson said in an interview, adding that his bill would not affect “the Leonardo DiCaprio kind of movies” with big budgets and high-priced stars.

Because California is facing a $23.6-billion budget deficit this year, the tax credit would not take effect until 2004; it would last until 2009.

The high-speed rail bill by Sen. Jim Costa (D-Fresno), SB 1856, would ask voters to approve a $9-billion bond to start construction of a 700-mile rail system linking all of the state’s major metropolitan areas and modeled on bullet trains in Europe and Japan.

The bonds would help cover the first leg of the system, linking Los Angeles and San Francisco. Supporters contend that with a combination of state, private and federal funding, the trains, which would travel at speeds of up to 200 mph, eventually could also link San Diego and Sacramento.

Proponents said such a rail line would help relieve worsening congestion on California streets and at major airports. Other countries have demonstrated that high-speed rail lines are among the “most efficient, least costly and least polluting ways to move people,” said Sen. Jack Scott (D-Altadena).

But Sen. Tom McClintock (R-Thousand Oaks) charged the proposal would gobble up money better spent on adding new freeway lanes. He denounced it as an “outrageously expensive boondoggle.”

The minimum-wage bill by Assemblyman Paul Koretz (D-West Hollywood), AB 2242, would automatically increase the wage, currently $6.75, to account for inflation. Koretz argued that slowly raising the minimum wage would help businesses by shielding them from the shock of the large wage hikes the state has imposed.

But most Republicans opposed the measure, arguing that minimum wage hikes inevitably drive up employers’ costs, leading them to cut positions.

Some of the liveliest debate Wednesday centered on a proposal to increase the share of California’s marriage license fee set aside for county domestic violence programs. A portion of the fee, which ranges from $45 to $70 depending on the county, already goes toward the programs. The bill, SB 1618 by Sen. Sheila Kuehl (D-Santa Monica), would raise it by $10 to $33 per license. It passed 27-12.

Democrats said options to finance domestic violence programs are limited.

But Republicans said the bill would only compound the financial burdens facing young newlyweds.

“How about a rebate?” said Sen. Bill Morrow (R-Oceanside). “If the husband can go two years without beating his wife, he ought to get a rebate.”

Finally, the Senate killed a bill that would have required pet dealers and breeders to pay an unspecified “registration fee” on every puppy and kitten they sell. Revenue from SB 1373 would have financed local databases for use in identifying animals that had been abandoned, stolen or lost.

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Times staff writer Julie Tamaki contributed to this report.