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California Film Tax Credit Presents a Real Opportunity to Change Hollywood

Lori Condinus is the President of the National Action Network Los Angeles.
Lori Condinus, President of the National Action Network Los Angeles.

*As industry insiders, advocates for change, and social justice activists, we are joining forces in this Op-Ed to shed light on the critical need to strengthen California’s Film Tax Credit program through community and stakeholder participation and oversight.

Thankfully, Sen. Lola Smallwood-Cuevas (D-Los Angeles) and Assemblymember Tina McKinnor (D-Hawthorne) have been spearheading this effort in the Legislature, calling for a Film Tax program that reflects the diverse landscape of the California workforce.

The motion picture industry is grappling with a multitude of challenges, including strikes, COVID-19 disruptions, and fierce competition from other states offering enticing tax incentives.

To address these issues and support the ever-evolving industry, California plans to extend the $1.2 billion film tax credit for another five years. While we applaud the commitment of Gov. Gavin Newsom and the Legislature to retain jobs in our state, it is essential that we seize this opportunity to bring about real change for disadvantaged and underrepresented workers.

We can’t afford to settle for mere job retention or isolated success stories from underrepresented workers; this moment calls for us to strive for true accountability and inclusivity within the industry.

Dominique Ulloa is a Peabody-Award winning editor and Founder of Ujima Entertainment Coalition.
Dominique Ulloa is a Peabody-Award-winning editor and Founder of Ujima Entertainment Coalition.

Looking to the future, the very essence of Hollywood as we know it may be at stake. Other states, including Texas, Georgia, Louisiana, New Jersey, and Missouri, have embraced film tax credit legislation, luring productions away from California.

According to McKinsey & Company’s 2021 Study on Black representation in film and TV, addressing persistent racial inequities could unlock an additional $10 billion in annual revenues for the industry.

This presents an incredible opportunity for California to not only lead by example inequitable representation but also bolster our economy and help shield ourselves from recession.

Throughout history, the motion picture industry has lacked the necessary mechanisms to ensure diversity, equity, inclusion, and accessibility in hiring practices. Version 4.0 of the California Film Tax Credit presents us with a fresh chance to make significant headway in this regard.

Previously, the industry operated mostly within the private sector, making it difficult for the state to evaluate compliance, progress, and enforce reporting requirements as it does with public sector jobs.

Under Version 3.0 of the California Film Tax Credit, the implementation of a Diversity Requirement aimed to increase employment opportunities for underrepresented workers. Unfortunately, this program fell short due to its lack of meaningful reporting requirements, community and stakeholder participation, and institutional support.

Studios receiving the tax credit were allowed to devise their own diversity plans and benchmarks.

We firmly believe we can change this by implementing a community- and other stakeholder-led film tax credit task force.

This task force would be responsible for monitoring and evaluating the diversity plans of tax credit recipients, using certified payroll data to verify that the industry’s efforts to promote diversity lead to tangible changes in its workforce demographics.

The task force would also provide productions with resources to help them implement these requirements through partnerships with nonprofits like Ujima Entertainment Coalition – a Black entertainment professionals staffing liaison, networking alliance, and advocacy group – as well as by offering guidance in using the ‘Inclusion Rider’ as a process for inclusive hiring.

As the state prepares for Version 4.0, let’s make sure that the creation of high-quality film and television content right here in Hollywood is an attainable goal for all aspiring creators, free from the confines of an antiquated ‘old Hollywood’ model that continues to perpetuate exclusion. We want to ensure that the real stakeholders—the workforce and community — are given a prominent seat at the table.

We can’t sit on the sidelines as passive observers; we have to show up as active participants who hold the power to enact change. So today, we are using that power to demand community- and stakeholder-led oversight as part of California’s Film Tax Credit Proposal.

As an editor, and the Founder of Ujima Entertainment Coalition, I, Dominique Ulloa, remain committed to advocating for a more inclusive and equitable television and film industry.

And, I, Lori Condinus, a labor leader and activist for over 30 years and the President of the National Action Network Los Angeles, have witnessed, firsthand, the amazing progress that is possible through labor-management-community collaboration, and I look forward to a fruitful endeavor with the Legislature and the other motion picture industry stakeholders. Let’s seize this opportunity to shape the future of California’s production landscape together.

About the Authors
Dominique Ulloa is a Peabody-Award-winning editor and Founder of Ujima Entertainment Coalition.

Lori Condinus is the President of the National Action Network Los Angeles.

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