The California state legislature has passed SB 186, a bill designed to fix an unintended problem affecting the state's $750 million annual film and television tax credit programme. The issue arose after a state budget bill, SB 122, signed earlier in the summer, introduced caps on business tax credits that risked undermining the competitiveness of the film incentive scheme expanded just last year, prompting concern from Hollywood advocates and unions.

Introduced at the last minute by state Senator Ben Allen, with a companion measure from Assemblymember Rick Chavez Zbur, SB 186 exempts independent productions from the new annual caps and improves terms for productions monetising their tax credits, raising the monetisable share from 90 to 95 percent and shortening the payout window from five years to two. The bill now awaits Governor Gavin Newsom's decision by the end of September. It follows a lobbying campaign in which, according to the Entertainment Union Coalition, 450,000 union members wrote to legislators, and has been welcomed by both the EUC and the Motion Picture Association as preserving California's competitiveness for film and TV production.