The State budget for 2021 that was signed into law by Governor Cuomo on April 3, 2020, maintains the annual amount of tax credit at $420 million, but made a number of substantial changes to the film tax credit.
The news is mostly bad for film producers, but there is a slight ray of sunshine for the Hudson Valley. The new rules take effect immediately.
Here are highlights.
The basic film production tax credit was reduced from 30% of qualified expenses to 25%.
The postproduction tax credit was reduced as well:
Inside the Metropolitan Commuter Transportation District (MCTD) the tax credit was reduced from 35% to 30%.
Outside the MCTD the tax credit was reduced from 30% to 25%.
A new minimum spending requirement has been imposed for eligibility:
The minimum spend is $1 million for projects with a majority of principal photography shooting days that take place within Westchester, Rockland, Nassau, or Suffolk counties or any of the five boroughs of New York City;
The minimum spend is $250,000 for projects shooting the majority of principal photography days in any other New York county.
So, a project anywhere in the State with qualified spending below $250,000 is not eligible for any tax credit at all.
A project with qualified spending above $250,000 but under $1 million will qualify for a tax credit only if a majority of principal photography shooting days take place outside Westchester, Rockland, Nassau, or Suffolk counties or any of the five boroughs of New York City (which is to say, in the Hudson Valley. There is that slight ray of sunshine).
Projects with a majority of principal photography shooting days take place in Westchester, Rockland, Nassau, or Suffolk counties or any of the five boroughs of New York City will qualify for the tax credit only if qualified spending is above $1 million.
Industry commentators expressed fears that new rules will inhibit the production of low-budget, independent, and risky films, especially in New York City. They also note that more than in many other industries, the film business follows the tax credits. New York may lose production to states with more generous credits, and cities like Vancouver and Toronto.
Locally, the new rules may lead to more film production and postproduction activity here in the Hudson Valley. We can only hope.
Local film resources can be found here:
There are other details in the new budget concerning the film tax credit that producers should be sure to review.
 Encompassing New York (Manhattan), Bronx, Kings (Brooklyn), Queens, Richmond (Staten Island), Rockland, Nassau, Suffolk, Orange, Putnam, Dutchess, and Westchester Counties.
This is not intended to be legal advice. You should contact an attorney for advice regarding your specific situation.