GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1999

H	1 

HOUSE BILL 1535

Short Title:  Film Industry Incentives.	(Public)

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Sponsors: Representatives Owens, McComas; Warner, Barefoot, and Goodwin.

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Referred to:  Finance, if favorable, Appropriations.

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May 16, 2000

A BILL TO BE ENTITLED
AN ACT TO PROVIDE INCENTIVES FOR DEVELOPMENT OF THE FILM INDUSTRY IN NORTH CAROLINA, TO MAKE THE NORTH CAROLINA FILM COUNCIL A STATUTORY ADVISORY COUNCIL, AND TO MODIFY THE FILM COUNCIL'S MEMBERSHIP.
The General Assembly of North Carolina enacts:
Section 1.  Part 2 of Article 10 of Chapter 143B of the General Statutes is amended by adding a new section to read:
"§ 143B-434.3. Film Industry Development Account.
(a)	Creation and Purpose of Account. – There is created in the Department of Commerce, Division of Travel and Tourism, the Film Industry Development Account to provide annual grants as incentives to production companies that engage in production activities in this State.  The Division of Travel and Tourism shall administer this program in accordance with the following provisions:
(1)	To be eligible for a grant, a production company must engage in production activities in this State.
(2)	A grant may not exceed fifteen percent (15%) of the amount the production company spends for goods and services in this State during the calendar year.
(3)	A grant may not exceed two hundred thousand dollars ($200,000) per production.
(b)	Production Company Defined. – As used in this section, the term ‘production company' has the meaning provided in G.S. 105-164.3.
(c)	Reports. – The Department of Commerce shall report annually to the General Assembly concerning the applications made to the account, the payments made from the account, and the effect of the payments on job creation in the State. The Department of Commerce shall also report quarterly to the Joint Legislative Commission on Governmental Operations and the Fiscal Research Division on the use of the moneys in the account, including information regarding to whom payments were made and in what amounts."
Section 2. There is appropriated from the General Fund to the Department of Commerce, Division of Travel and Tourism, the sum of five million dollars ($5,000,000) for the 2000-2001 fiscal year for the Film Industry Development Account created in this act.  It is the intent of the General Assembly to appropriate to the Film Industry Development Account the sum of five million dollars ($5,000,000) in each fiscal year of the 2001-2003 fiscal biennium.
Section 3.  G.S. 143-341(4) is amended by adding a new subdivision to read:
"§ 143-341. Powers and duties of Department.
The Department of Administration has the following powers and duties:
… 
(4)	Real Property Control:
	… 
o.	To provide that no fee, other than reimbursement of actual costs incurred and actual revenues lost by the State, shall be charged when State buildings are made available to a production company for a production.  As used in this subdivision, the term ‘production company' has the meaning provided in G.S. 105-164.3."
Section 4.  Article 10 of Chapter 143 of the General Statutes is amended by adding a new section to read:
"§ 143-162.2. Use of public property by production companies.
If a State agency makes real property available to a production company for a production, it shall not charge any fee other than reimbursement of actual costs incurred and actual revenues lost by the agency.  As used in this section, the term ‘production company' has the meaning provided in G.S. 105-164.3.  This section does not require a State agency to make real property available to a production company for a production."
Section 5.  G.S. 105-164.3 is amended by adding a new subdivision to read:
"(11c)	‘Production company' means a person engaged in the business of making original motion picture, television, or radio images for theatrical, commercial, advertising, or educational purposes."
Section 6.  G.S. 105-164.13(22a) reads as rewritten:
"(22a)	Sales of audiovisual masters made or used by a production company in making visual and audio images for first generation reproduction. For the purpose of this subdivision, an "audiovisual master”is an audio or video film, tape, or disk or another audio or video storage device from which all other copies are made. "
Section 7.  G.S. 105-164.14 is amended by adding a new subsection to read:
"( j)	Production Companies. – A production company is allowed an annual refund of part of the State sales tax it pays under G.S. 105-164.4(a)(3) on the rental of transient accommodations for occupancy by its employees.  If an employee of the production company occupies a transient accommodation for a continuous period of more than 30 days but less than 90 days, the production company is allowed a refund of the State sales tax it paid on the rental for the entire rental period.  Notwithstanding any other provision of law, the refund allowed in this subsection does not apply to general local sales and use taxes levied under Subchapter VIII of this Chapter, Chapter 1069 of the 1967 Session Laws, or any other local act.
A request for a refund must be in writing and must include any information and documentation required by the Secretary.  A request for a refund is due within six months after the end of the State's fiscal year.  Refunds applied for after the due date are barred."
Section 8.(a) Executive Order Number 51, issued June 10, 1994, as extended by Executive Order Number 166, issued December 30, 1999, is enacted and codified as G.S. 143B-434.5 in Part 2 of Article 10 of Chapter 143B of the General Statutes.
Section 8.(b)	G.S. 143B-434.5, as enacted by this section, is rewritten to read:
"§ 143B-434.5. North Carolina Film Council.
(a)	Creation. – The North Carolina Film Council is created as an advisory council within the Department of Commerce.  The Council is a continuation of the North Carolina Film Council created in Executive Order Number 51, issued June 10, 1994.
(b)	Duties. – The Council shall:
(1)	Advise the Governor on matters that would enhance the likelihood of the film industry choosing North Carolina for filmmaking.
(2)	Advise the Secretary of Commerce and the Division of Travel and Tourism in the Department of Commerce on filmmaking activities within North Carolina.
(3)	Serve as a forum for filmmaking concerns and recommendations relating to the film industry in North Carolina that would include the following:
a.	Compile a database registry of locations within North Carolina that would be potential sites for filmmaking.
b.	Develop the financial capability of North Carolina to support projects with local financing of the film industry.
c.	Develop a support network for production activities relating to the film industry.
d.	Develop a manual for the use of local governments and municipalities detailing supportive activities that would facilitate filmmaking in their communities.
e.	Assist in the support and coordination of the activities of local film commissions in North Carolina.
d.	Provide advice on projects directly assigned by the Governor to the Council.
e.	Assist with recruitment of the film industry to select North Carolina sites for filmmaking.
f.	Develop an annual report on the economic impact of the filmmaking industry in North Carolina, along with recommendations to increase the filmmaking activities within North Carolina.
(c)	Membership. – The Council shall consist of 25 voting members appointed as follows:
(1)	Two at-large members appointed by the Speaker of the House of Representatives.
(2)	Two at-large members appointed by the President Pro Tempore of the Senate.
(3)	Twenty-one members appointed by the Governor as follows:
a.	Five representatives of the film industry within the State representing acting, production, directing, producing, and film studio management.
b.	Five representatives of business and industry.
c.	Three representatives of State or local government.
d.	Eight at-large members.
(d)	Terms of Membership. – Members shall serve staggered three-year terms.  The terms of members appointed under this section shall begin at the expiration of the respective terms of members appointed, as of December 31, 2000, to the Council's predecessor created by executive order.
(e)	Vacancies. – Vacancies are filled in the same manner as the original appointment, for the balance of the unexpired term.
(f)	Travel Expenses. – Members of the Council shall receive necessary travel and subsistence expenses, when available, from Department of Commerce funds, pursuant to G.S. 138-5.
(g)	Officers. – The Governor shall appoint a chair and vice-chair of the Council for a term of two years.  The Council may elect other officers it considers necessary.
(h)	Meetings. – The Council shall meet at least three times a year and at other times at the call of the chair or upon written request of at least 10 of its members.
(i)	Staff Assistance. – The Department of Commerce shall provide clerical support and other services required by the Council.
(j)	Dual Officeholding. – The North Carolina Film Council is not a public office.  Membership on the Council may, therefore, be held in addition to the number of offices authorized by G.S. 128-1.1."
Section 9.(a) Sections 1 and 2 of this act become effective July 1, 2000.  Section 7 of this act becomes effective October 1, 2000, and applies to taxes paid on or after that date.
Section 9.(b) Section 8 of this act becomes effective January 1, 2001.  Section 8 does not affect the existing membership of the North Carolina Film Council as of December 31, 2000.  The change in appointing officer for four of the at-large members becomes effective as follows: the appointments by the Speaker of the House of Representatives become effective upon the expiration of the first two at-large members' terms of office expiring after January 1, 2001, and the appointments by the President Pro Tempore of the Senate become effective upon the expiration of the next two at-large members' terms of office expiring after January 1, 2001.
Section 9.(c) The remainder of this act is effective when it becomes law.