79R11427 MTB-D


By:  Hamric, Wong, Hunter, Keffer of Eastland,                    H.B. No. 2954
 
    Dukes                                                                    

Substitute the following for H.B. No. 2954:                                   

By:  Hilderbran                                               C.S.H.B. No. 2954



A BILL TO BE ENTITLED

AN ACT

relating to the creation of a film industry incentive program.                
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Sections 485.001-485.007, Government Code, are 
designated as Subchapter A, Chapter 485, Government Code, and a 
subchapter heading is added to read as follows:

SUBCHAPTER A.  GENERAL PROVISIONS
	SECTION 2.  Chapter 485, Government Code, is amended by 
adding Subchapter B to read as follows:

SUBCHAPTER B.  FILM INDUSTRY INCENTIVE PROGRAM
	Sec. 485.021.  DEFINITIONS.  In this subchapter:                        
		(1)  "Filmed entertainment" means a visual and sound 
production, including a:
			(A)  film;                                                            
			(B)  television program; or                                           
			(C)  national or multistate commercial.                               
		(2)  "Production company" includes a film production 
company, television production company, or film and television 
production company.
		(3)  "Texas resident" means an individual who has 
resided in Texas since the 60th day before the first day of 
principal photography on a filmed entertainment.
		(4)  "Underused area" includes any area of this state 
other than the metropolitan areas of Austin, Houston, or 
Dallas-Fort Worth.
	Sec. 485.022.  FILM INDUSTRY INCENTIVE PROGRAM.  (a)  The 
office shall administer a grant program for production companies 
that produce filmed entertainments in this state.
	(b)  The office shall develop a procedure for the submission 
of grant applications and the awarding of grants under this 
subchapter.  The procedure must include provisions relating to:
		(1)  methods by which an individual's Texas residency 
as described by Section 485.021(3) can be proved; and
		(2)  requirements for the submission, before 
production of a filmed entertainment begins, of an estimate of 
total wages that will be paid to Texas residents.
	Sec. 485.023.  QUALIFICATION.  To qualify for a grant under 
this subchapter, a production company must pay a minimum of:
		(1)  $500,000 in wages to Texas residents for a film or 
television program; or
		(2)  $50,000 in wages to Texas residents for a 
commercial or series of commercials.
	Sec. 485.024.  GRANT.  (a)  Except as provided by Section 
485.025, a grant under this subchapter may not exceed the lesser of:
		(1)  20 percent of the wages paid to Texas residents for 
a filmed entertainment; or
		(2)  $750,000.                                                         
	(b)  In calculating a grant amount under Subsection (a), the 
office may not include wages of persons, including an actor or 
director, employed in the production of a filmed entertainment that 
are:
		(1)  a major part of the production costs of the 
entertainment, as determined by the office; and
		(2)  negotiated or spent before production begins.                     
	Sec. 485.025.  ADDITIONAL GRANT FOR UNDERUSED AREAS. In 
addition to the grant calculated under Section 485.024, a 
production company that spends at least 25 percent of a filmed 
entertainment's filming days in an underused area is eligible for 
an additional grant in an amount equal to five percent of the wages 
paid to Texas residents for the filmed entertainment.
	Sec. 485.026.  STATE DEBT.  If a production company owes 
money to the state at the time the production company is awarded a 
grant under this subchapter, the office shall offset the amount 
owed to the state from the amount awarded.
	SECTION 3.  Section 156.251, Tax Code, is amended by adding 
Subsections (e) and (f) to read as follows:
	(e)  In addition to the revenue allocated under Subsection 
(d), an amount equal to the amount of revenue derived from the 
collection of taxes imposed by this chapter at a rate of one-half of 
one percent shall be allocated in the general revenue fund as 
follows:
		(1)  an amount not to exceed $10 million may be used 
only for the activities of the tourism division of the Texas 
Economic Development and Tourism Office; and
		(2)  an amount not to exceed $20 million may be used 
only for the promotion and funding of the film industry incentive 
program by the Music, Film, Television, and Multimedia Office.
	(f)  This subsection and Subsection (e) expire August 31, 
2007.       
	SECTION 4.  This Act takes effect September 1, 2005.