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Culver City looks to lower tax burden for production companies

October 13, 2010 |  8:35 pm

Culver City, home of Sony Pictures Entertainment and the historic Culver Studios where "Gone with the Wind" was filmed, has long taken pride in its ties to Hollywood. 

Now the small city in western Los Angeles County is facing pressure to live up to its motto: "The Heart of Screenland."

Amid concerns raised by Sony, Culver Studios and the Motion Picture Assn. of America, the city is exploring a plan to scale back, or even scrap entirely, a business tax that production companies must pay when they film in the city.

In contrast to the city of Los Angeles, which has a $12,495 cap on what production companies must pay in business taxes, Culver has no such limit for long-term projects, charging $1 for every $1,000 in expenses. As a result, a producer of a TV series could end up paying a tax bill of up to $80,000.

Industry executives complain that such taxes put Culver City at a competitive disadvantage, especially at a time when the region is struggling to keep jobs from leaving California.

"Because so much production has left Southern California -- if another studio decides to keep a project in the region, they have a surplus of choices of where to film on a stage -- from facilities in Santa Clarita to Burbank," Jonathan Cowan, executive director of government affairs for Sony Pictures Entertainment, said Monday at the Culver City Council meeting. "Productions are increasingly more price sensitive and pay attention to costs of even a few thousand dollars.''

James Cella, who heads Culver Studios, which hosts the ABC show "Cougar Town" and was also home to the recently canceled comedy series "Scrubs," said the tax was bad for business.

"I'm fighting to keep my business here and anything that increases the costs of being here in Culver City has a negative impact, not only on Culver Studios, but the businesses in the city," he said.

At Monday's meeting, council members seemed receptive to the concerns and instructed city staff to come up with a revised tax plan.

-- Richard Verrier

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