A bill to allow up to $250 million in annual film tax credits to entice projects to Montana, up from a $10 million cap, cleared an initial vote in the House on Tuesday by an 82-16 margin.
House Bill 340 is from Speaker of the House Wylie Galt, a Republican from Martinsdale. After the floor vote, the bill was quickly heard in the House Appropriations Committee. It faces a deadline of Thursday to advance to the Senate.
"You want a good jobs bill, you want a tax cut bill, this is the bill," Galt told the House on Tuesday.
This session's version of the Montana Economic Development Industry Advancement (MEDIA) Act is an update from the initial 2019 bill, also from Galt.
Film operations can claim tax credits generally on up to 25% of wages for up to $10 million, with that jumping to 30% in economically underserved areas. The bill also dramatically expands the types of projects and work that qualifies.
HB 340 also expands from traditional films to instructional videos, internet commercials and non-scripted television programs.
A fiscal note attached to the bill shows that there were six independent features in Montana before the 2019 bill passed. In the 2020 fiscal year there were 13 independent features. Based on the expansion of projects that qualify, the note estimates there'd be an additional 63 projects eligible for tax credits.
The note, which Galt did not sign, shows an estimated hit of $49.5 million to the state's general fund by the 2025 fiscal year. But Rep. David Bedey, R-Hamilton, said that the note doesn't capture the economic benefits of the bill.
"This is a tax policy that is business-friendly," Bedey said. "The positive economic benefit is not captured in this fiscal note."
A report produced for the Montana Film Office in June 2020 showed local direct spending of film projects in Montana since the passage of the 2019 bill was $37.2 million, including $18.2 million in employee wages.
An initial version of the bill eliminated the tax credit cap, but it was amended before reaching the House floor to include the $250 million maximum amount of credits.
There have been several major projects filming in Montana, such as the "Yellowstone" television show filming in the Bitterroot. Bedey said the project has benefited the entire valley. Filming for "Yellowstone" has also taken place in Missoula.
The state's first effort to bring film projects to Montana was the Big Sky on the Big Screen Act, which passed in 2005 with a 2015 sunset. Over that decade, 129 projects were approved to receive the incentive, and 48 claimed credits.