California Tried to Jumpstart the Film Economy. Production Keeps Falling.
California’s $750 million bet on Hollywood has not reversed the overall decline in production, according to data released Wednesday by FilmLA.
Instead, production levels fell 3.7% in the third quarter — even as the share of projects receiving state subsidies continued to rise. Location shoots remain well below the five-year average.
State officials had hoped that the dramatic expansion of the state’s film and TV tax credit last year would show stronger results by now. After an encouraging first quarter of 2026, Los Angeles Mayor Karen Bass declared that the industry was “turning a corner.”
But the number of shoot days has declined in both quarters since then, suggesting that the magnitude of the state tax credit was simply not enough to offset the forces behind the decline.
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In a statement on Wednesday, Bass nevertheless highlighted “encouraging signs of progress,” noting that the share of scripted projects receiving state subsidies has nearly doubled since last year.
“These gains show that incentives work, but we must do more,” Bass said, reiterating her support for an unlimited state incentive.
Her opponent in the upcoming mayoral election, Nithya Raman, has faulted Bass for not doing more to help the industry, and has also called eliminating the cap on the state subsidy.
In 2025, Gov. Gavin Newsom led the move to increase the state’s film and TV incentive from $330 million per year to $750 million. The California Film Commission saw an immediate jump in applications after the increase took effect on July 1, 2025, with the expectation that those projects would go into production in early 2026.
While the expansion has not reversed the decline in total production volume, it has led to a measurable increase in the share of L.A. shows receiving tax credits. According to FilmLA, 40.2% of scripted shows filming in the last quarter received the state tax credit — nearly double the figure from a year ago.
In TV comedy, some 62% of shows received the credit — up from 19% in 2025 — while in TV dramas the share increased from 21% to 49%.
On the bright side, TV comedy recorded its best quarter since the 2023 strikes by the Writers Guild of America and SAG-AFTRA, with 192 shoot days, up from 57 in the prior three months. But that increase was more than offset by a decline in TV dramas from 732 shoot days to 494. Reality TV also continued to struggle with 630 shoot days, 66% below the five-year average.
“Obviously we’re disappointed to see the numbers down overall,” said Philip Sokoloski, a VP at FilmLA, though he noted that some of the state-supported categories did see an increase. “The fact remains that work that does not receive incentive support is increasingly likely to leave California for places that are more affordable.”
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