Proposed Rules Title 13

TITLE 13. CULTURAL RESOURCES

CHAPTER 121. TEXAS MOVING IMAGE INDUSTRY INCENTIVE PROGRAM

The Texas Film Commission within the Economic Development and Tourism Office of the Office of the Governor Office of the Governor ("OOG") proposes amendments to 13 TAC §121.3, concerning Eligible Projects. The proposed amendments will align Texas Moving Image Industry Incentive Program ("TMIIIP") rules with changes made by the 88th Legislature.

EXPLANATION OF PROPOSED AMENDMENTS

The rule under consideration relates to TMIIIP, which was implemented to increase employment opportunities for Texas industry professionals, encourage tourism to the state, and boost economic activity in Texas cities and the overall Texas economy. The 88th Legislature passed House Bill 4539, which changed the residency threshold requirement for crew, actors, and extras from this state from 70% to 55%. The proposed amendments to §121.3 align the rule with Section 485.023, Texas Government Code, as modified by the 88th Legislature.

FISCAL NOTE

Stephanie Whallon, Director, Texas Film Commission, has determined that during each year of the first five years in which the proposed amendments are in effect, there will be no expected fiscal impact on state and local governments as a result of enforcing or administering the proposed amendments.

Ms. Whallon does not anticipate any measurable effect on local employment or the local economy as a result of the proposed amendments.

PUBLIC BENEFIT AND COSTS

Ms. Whallon has also determined that during each year of the first five years in which the proposed amendments are in effect, the rule change will yield the anticipated public benefit of increasing employment opportunities for Texas residents in the moving images industry by lowering an eligibility requirement for a TMIIIP grant in order to expand the number of qualifying projects.

Ms. Whallon has determined there are no measurable anticipated economic costs to persons required to comply with the proposed amendments.

There will be no adverse economic effect on small businesses, micro-businesses, or rural communities. Since the OOG has determined that the proposed rule will have no adverse economic effect on small businesses, micro-businesses, or rural communities, preparation of an Economic Impact Statement and a Regulatory Flexibility Analysis, as detailed under Texas Government Code §2006.002, is not required.

GOVERNMENT GROWTH IMPACT STATEMENT

Ms. Whallon has determined that during each year of the first five years in which the proposed amendments are in effect, the amendments:

1) will not create or eliminate a government program;

2) will not require the creation of new employee positions or the elimination of existing employee positions;

3) will not require an increase or decrease in future legislative appropriations to the OOG;

4) will not require an increase or decrease in fees paid to the OOG;

5) do not create a new regulation;

6) will expand certain existing regulations;

7) will not increase or decrease the number of individuals subject to the applicability of the rules; and

8) will positively affect the Texas economy.

TAKINGS IMPACT ASSESSMENT

The OOG has determined that no private real property interests are affected by the proposed rules and the proposed rules do not restrict, limit, or impose a burden on an owner's rights to the owner's private real property that would otherwise exist in the absence of government action. As a result, the proposed amendments do not constitute a taking or require a takings impact assessment under Government Code §2007.043.

SUBMISSION OF COMMENTS

Written comments regarding the proposed rule amendments may be submitted for 30 days following the date of publication of this notice by mail to Stephanie Whallon, Office of the Governor, Texas Film Commission, P.O. Box 12428, Austin, Texas 78711 or by email to TFCRules.Comments@gov.texas.gov with the subject line "TMIIIP Rule Review." The deadline for receipt of comments is 5:00 p.m., Central Time, on August 13, 2023.

STATUTORY AUTHORITY

The amendments are proposed under Section 485.022 of the Texas Government Code, which requires the Texas Film Commission to develop procedures for the administration and calculation of grant awards under TMIIIP. The amendments are also proposed in accordance with House Bill 4539, which was signed by Governor Abbott on June 12, 2023, and will take effect on September 1, 2023.

CROSS REFERENCE TO STATUTE

Chapter 121 of Texas Government Code. No other statutes, articles, or codes are affected by the proposed amendments.

§121.3.Eligible Projects.

(a) A project may be eligible for a grant under the Texas Moving Image Industry Incentive Program if it meets the stated minimum requirements listed in Subsections (b) - (h) of this Section, is appropriate in content, and represents a potential economic impact in Texas, as assessed in §121.9(c)(3) of this Chapter, that is sufficient to justify acceptance in the program.

(b) Feature Films.

(1) Feature Film Applicants must expend a minimum of $250,000 in in-state spending.

(2) Applicants must film at least 60% of a project in Texas. Applicants must fulfill this requirement by:

(A) completing at least 60% of Filming Days in Texas; or

(B) if the Texas Film Commission (Commission) provides prior written approval:

(i) completing at least 60% of the total project Man Hours in Texas; or

(ii) having at least 60% of the actual locations used and paid for, not including basecamps, in Texas.

(3) Except as provided in paragraph (4) of this Subsection, 55% [~~70%~~] of the Crew paid by the Applicant and 55% [~~70%~~] of the Cast paid by the Applicant, including extras, must be Texas Residents, unless it is determined and certified by the Commission in writing that a sufficient number of qualified Crew and Cast, including extras, are not available and every effort has been made by the production to meet the requirement by the Principal Start Date.

(4) For animated or documentary Feature Films, 55% [~~70%~~] of the combined total of Crew and Cast paid by the Applicant, including extras, must be Texas Residents, unless it is determined and certified by the Commission in writing that qualified Crew and Cast are not available and every effort has been made by the production to meet the requirement by the Principal Start Date.

(1) Television Program Applicants must expend a minimum of $250,000 in in-state spending.