State Sen. Ben Allen (D-Santa Monica) and Assemblyman Rick Chavez Zbur (D-Hollywood) have introduced legislation intended to modify recent changes affecting California’s Film and Television Tax Credit Program.

AB 186 and SB 186, introduced as budget trailer bills, would address provisions of SB 122 that lawmakers said could limit the effectiveness of incentives enacted last year to encourage film and television production in California.

In 2025, California increased the annual cap on its Film and Television Tax Credit Program to $750 million and expanded eligibility and credit amounts. Allen and Zbur said 170 film and television projects received credits during the program year from July 1, 2025-June 30, 2026, representing an estimated $6.6 billion in economic activity and nearly 35,000 cast and crew jobs statewide.

SB 122, enacted in June, imposed an additional limitation on business tax credits, including credits available through the film and television program. Allen and Zbur said the change could affect productions that have already been awarded incentives.

AB 186 and SB 186 would exempt independent productions from the limitations established by SB 122. The legislation would also reduce the discount applied to refunds under the Film and Television Tax Credit Program 4.0 from 10% to 5% and allow refunds to be paid over two years instead of five.

Additionally, the proposal would protect unused credits earned under earlier versions of the program from expiring if a company has a project awarded under Program 4.0.