A method for encoding input video data in a backward-compatible layered stream, the method comprising: accessing a first signal with a first spatial resolution and a first dynamic range; accessing a second signal with a second spatial resolution and a second dynamic range, wherein the second dynamic range is lower than the first dynamic range; in response to the second signal, generating with a processor a base layer signal with a preferred coding color format; in response to the first signal, generating with the processor a reference prediction signal with the second spatial resolution, the first dynamic range, and the preferred coding color format; computing luma prediction coefficients for a luma predictor in response to luma pixel values of the reference prediction signal and luma pixel values of the base layer signal, and not in response to chroma pixel values of the reference prediction signal or of the base layer signal; computing chroma prediction coefficients for a chroma predictor in response to both luma and chroma pixel values of the reference prediction signal and luma and chroma pixel values of the base layer signal; generating a predicted signal with the first dynamic range using the luma predictor and the chroma predictor in response to the base layer signal and the luma and chroma prediction coefficients; generating a residual signal in response to the first signal and the predicted signal; generating a coded base layer stream using a base layer encoder in response to the base layer signal; and generating a coded enhancement layer stream using an enhancement layer encoder in response to the residual signal. accessing a first signal with a first spatial resolution and a first dynamic range; accessing a second signal with a second spatial resolution and a second dynamic range, wherein the second dynamic range is lower than the first dynamic range; in response to the second signal, generating with a processor a base layer signal with a preferred coding color format; in response to the first signal, generating with the processor a reference prediction signal with the second spatial resolution, the first dynamic range, and the preferred coding color format; computing luma prediction coefficients for a luma predictor in response to luma pixel values of the reference prediction signal and luma pixel values of the base layer signal, and not in response to chroma pixel values of the reference prediction signal or of the base layer signal; computing chroma prediction coefficients for a chroma predictor in response to both luma and chroma pixel values of the reference prediction signal and luma and chroma pixel values of the base layer signal; generating a predicted signal with the first dynamic range using the luma predictor and the chroma predictor in response to the base layer signal and the luma and chroma prediction coefficients; generating a residual signal in response to the first signal and the predicted signal; generating a coded base layer stream using a base layer encoder in response to the base layer signal; and generating a coded enhancement layer stream using an enhancement layer encoder in response to the residual signal.