California productions to spend at least $90 million on COVID-19 safety measures

The COVID-19 pandemic halted productions and imposed costly new safety measures on film and television projects.

A new report has put a price tag on the costs, at least for productions that received state tax credits.

About 50 projects in the California tax incentive program are expected to spend more than $90 million on COVID-19-related costs, according to data released from the California Film Commission on Tuesday. Those productions have a total budget of $1.9 billion.

The details were released as part of a broader progress report from the commission on its tax credit program.

While the findings represent just a faction of the overall film and TV industry in the state, they highlight the pandemic’s financial toll on Hollywood.

The report is based on budgets that producers submitted to the state for review, including COVID-related expenses which qualify for state tax credits.

“Most countries and states are including COVID expenditures in their tax programs,” said Joe Chianase, senior vice president at Entertainment Partners, which advises producers on film tax incentives. “It has just become the cost of doing business.”

Feature films with budgets of more than $20 million in the tax credit program are expected to spend 5% to 6.5% of their total budgets on COVID-related costs, the report said.

Lower budget shows are expected to allocate 4.5% of their total budgets to COVID-related costs.

The commission found 60% of the costs were related to materials and 40% were tied to labor costs.

When the pandemic struck last year, most productions nationwide shut down in mid-March.

Employment in the motion picture sector — much of it concentrated in Los Angeles County — fell to 98,000 jobs in August 2020, down 45% from February that year, according to data from the California Employment Development Department and the Bureau of Labor Statistics analyzed by Beacon Economics.

A coalition of entertainment industry unions and studios agreed to terms for cast and crew to return to work in September 2020. Those provisions included requirements for social distancing, testing, sick pay and other safety measures.

Film production companies created new departments to implement and enforce safety measures, including the new role of COVID compliance supervisor.

Producers also had to pay for tests, face shields and additional vehicles needed for social distancing.

Production has roared back in the past year as filming has resumed, with on-location filming in the Los Angeles area outpacing pre-pandemic levels.

The state’s film tax credit program allows producers to receive 20%-25% credits on certain qualified expenses, such as money spent on building sets and hiring crew members.

California allocates $330 million annually in film tax credits. The Legislature expanded the program this summer, providing a new $150-million fund for the construction of soundstages.