An Act To Expand Tax Incentives. for Visual Media Productions
Maine Legislature, Session 124, LD 1449
Committee: Taxation
Sponsors: WATSON, RECTOR, CROCKETT, FLEMINGS, LEGG, PERCY, PIOTTI, WEBSTER
Amends: 36 MRSA §191, 36 MRSA §5219-Y, 36 MRSA §5219-D

MAINE STATE LEGISLATURE 
The following document is provided by the 
LAW AND LEGISLATIVE DIGITAL LIBRARY 
at the Maine State Law and Legislative Reference Library 
http://legislature.maine.gov/lawlib 
Reproduced from scanned originals with text recognition applied 
(searchable text may contain some errors and/or omissions) 
o 
i-
,'h 
(') 
'".....J-. 
(~ 
c":'" '-,"OC, 
~1H~J L_ 
/4UGUE~T' 
124th MAl E LEGISLATURE 
FIRST REGULAR SESSIO~.J-2009 
Legislative Document 
No. 1449 
H.P. 1005 
House of Representatives, April 8, 2009 
An Act To Expand Tax Incentives. for Visual Media Productions 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Representative WATSON of Bath. 
Cosponsored by Senator RECTOR of Knox and 
71~1?1·11ltJ£~{ 
MILLICENT M. MacFARLAND 
Clerk 
Representatives: CORNELL du HOUX of Brunswick, CROCKETT of Augusta, FLEMINGS 
of Bar Harbor, LEGG of Kennebunk, PERCY of Phippsburg, PIOTTI of Unity, WEBSTER of 
Freepoli. 
Prinh:J on rct.:ydeJ puper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 5 MRSA § 13090-L, as enacted by PL 2005, c. 519, Pt. GG, § 1, is 
amended to read: 
§13090-L. Visual media production certification 
1. Generally. A visual media production company that intends to undertake a visual 
media production in this State may apply to the department to have the production, or a 
portion of the production, certified under subsection J 3-A for purposes of the visual 
media production reimbursement pursuant to Title 36. chapter 919 A ffi1d the credit under 
Title 36, seCtion 5219 Y 5219-DD. 
2. Definitions. As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings. 
A. "Media Visual media production" means a single-medium or multimedia feature 
film, television show or series, video, commercial, photograpmc project, interactive 
computer or video game or other prograniintended for a local, regional, national or 
international audience and fixed on film, video tape, computer disk, laser disc or 
other delivery medium that can be viewed or reproduced and that is exhibited in 
theaters or by individual television stations or gr~ups of stations,television networks 
or cable television stations or via other means or licensed for home viewing or use. 
"Media Visual media production" does notinclu~e: 
(1) 
A news, current events or public programming show or a program that 
includes weather or market reports; 
(2) A talk show; 
(3) A sports event or activity; 
(4) A gala presentation or awards show; 
(5) A finished production that solicits funds; or 
(6) A production produced by a visual media production company if records, as 
required by 18 United States Code, Section 2257, are to be maintained by that 
visual media production company with respect to any performer portrayed in that 
production. 
B. 
"~Visual media production company" means a person engaged in the 
business of producing a visual media production. 
C. 
"Media production e),pense" means an expense directly incurred during the 
creation of a media production. This term inCludes \vages and salaries of individuals 
employed in the production on '.vhich tm,es have been paid or accrued; the cost of 
construction, operations, editing and related services, still and motion photography, 
sound recording and synchronization, lighting, wardrobe and accessories; and the 
rental of facilities and equipment, including location fees. The term does not include 
e),penses incurred in marketing and advertising a media production or in printing or 
otherwise disseminatine: a medianroduction. 
) 
') 
) 
n 
". 
\ ',--.-/ 
C-1. 
"Visual media production expense" means expenses directly incurred in the 
State for preproduction, production and postproduction of a visual media production 
certified under this section. 
' 
"Visual media production expense" includes expenditures for set construction and 
operation; wardrobe, makeup, . accessories and related services; photography and 
sound synchronization; lighting and related services and materials; editing and related 
services; rental of facilities and equipment; leasing of vehicles;, food and lodging for 
cast and crew; digital and tape editing, film processing and transfer of film to tape or 
digital format; sound mixing; special and visual effects; total aggregate payroll and 
fringe benefits; music, if performed, composed or recorded by a Maine musician or 
released or published by a company based in the State; airfare, if purchased through a 
travel agency or travel company based in the State; insurance costs or bonding, if 
purchased through an insurance agency based in the State; payment to a personal 
services corporation registered as a business in: the State ,for the services of an out-of-
state performing artist working in the State; chartering an aircraft for in-state 
'transportation; commercial airfare purchased through a travel agency based in the 
State for travel'within the State or to or from the State; and other similar production 
expenditures as determined by rule. 
"Visual media production expense" does not include postproduction expenditures for 
publication of printed materials, marketing or distribution; barters or trades for goods 
and services unless state tax is paid on the transaction; donations made to nonprofit 
corporations that are exempt from income tax under Section 50lCc) of the Internal 
Revenue Code; purchases made on the futernet unless the seller is based in the State; 
payments to the State or Federal Goveinment; payments to delivery services unless 
the delivery originates in the State; or salaries of more than $1,000,000 to any 
individual in a certified visual media production. 
D. "Person" has the same meariingas in Title 36, section Ill, subsection 3. 
3. 
Requirements for media produetion certificate. Applications for a media 
production certificate must be made on a form prescribed and fumislied by the 
department. The applicant must: 
A. 
Provide the names of the principals involved in the media production and 
contact information for them; 
B. 
Provide a certificate of insurance for the media production; 
C. 
Provide financial information that demonstrates that the media production is 
economically sound and that at least $250,000 of media production expense 'Vlill be 
incurred in Maine during a period of 12 consecutive months; 
D. 
Provide data demonstrating that the media production will benefit the people of 
the State by increasing opportunities for ,employment and will strengthen the 
economy of the State; 
E. 
Agrec to include, in all certified media productions, an on screen credit for the 
S tate of Maine. The e)(Uct wording and size of that credit must be detem-lined in RIles 
adopted by the Maine State Film Office and the department. The Maine State Film 
Office or the deoartment mav. at its discretion. exemnt media DFoductions from this 
, Page 2 - INLR0623(OI)-1 
requirement. Rllles adopted pursuant to this paragraph are routine technical rules as 
defined in chanter 375. sub chanter 2 A: 
F. 
Provide evidence that the media production company is not owned by, affiliated 
with or controlled by, in whole or in part, a person that is in default on a loan made 
. 
by the State or a loan guaranteed b)' the State; and 
G.Provide any other information required by the department. 
To qualify for a media production certificate, a media production company must 
demonstrate to the $atisfaction of the commissioner that the media production company 
has met, ot vAll meet, the eJcpectations and requirements under paragraphs B, C, D, E, F 
and G. If the department detenmnes that the applicant does not qualify for a media 
production certificate, it must inform the applicant of that detenmnation in v,'riting ',vithin 
vleeks of receiving the application. As soon as practicable, the department shall issue a 
media production certificate for a media production that qualifies. The department shall 
include with the certificate information regarding qualification. for a tm, reimbursement 
. and credit certificate pursuant to subsection 4 and procedures for claiming reimbursement 
under Title 36, chapter 919 A and the credit under Title 36, section 5219 Y. 
3-A. 
Visual media production ·certificate. 
Applications for a visual media 
production certificate must be made on a form prescribed and fuinished by the 
department. .The applicant must provide a plan for the visual media production certificate 
that includes: 
A. The names of the principals involved in the visual media production and contact 
information for them; 
B. A certificate of insurance for the visual media production; 
C. 
Proof that the visual media production has been fully financed and that a 
production office has been opened in the State; 
D. A projected schedule for preproduction, production and postproduction of the 
visual media production that shows that the production will begin within 60 days 
after certification is given; 
E. 
Financial information that demonstrates. that the visual media production' is 
economically sound and that estimates the amount of visual media pro'duction 
expense that will be incurred in the State during the project and the estimated timing 
of when the expense will be incurred; 
. 
F. Data demonstrating that the visual media production will benefit the people of the 
State by increasing opportunities for employment and will strengthen the economy of 
the State; 
G. An agreement to include, in all certified visual media productions, an onscreen 
credit for the State of Maine. The exact wording and size of that credit must be 
determined in rules adopted by the Maine State Film Office and the department. The 
Maine State Film Office or the department may, at its discretion, exempt visual' media 
productions from this requirement. Rules adopted pursuant to this paragraph are 
routine technicalrules as defined in.chapter 375, subchapter 2-A; 
) 
) 
) 
n 
) 
r; 
L/ 
H. Evidence that the visual media production company is not owned by, affiliated 
with or controlled by, in whole or in part, a person that is in default on a loan made 
by the State or a loan guaranteed by the ~tate; and 
1. Any other information required by the department. 
To qualify for a visual media production certificate,' a visual media production company 
must demonstrate to the satisfaction of the commissioner that the visual media production 
company has met the requirements of this subsection .. If the department determines that 
the applicant does not qualify for a visual media production certificate, it must inform the 
applicant of that determinati()n in writing within 4 weeks after receiving the application. 
As soon as practicable, the department shall issue a visual media production certificate 
for a visual media production that qualifies. 
The department shall include with the 
certificate information regarding qualification for a tax credit certificate pursuant to 
subsection 4 and procedures for claiming the credit under Title 36, section 52I9-DD. The 
department may not issue visual media production certificates that total more than 
$5~000,000 during any fiscal year. 
,4. Tax credit certificate. Within 4 weeks sf after completion of a certified visual 
media production, the visual media production company shall confirm its compliance 
with the requirements of subsection ~ 3-A with respect to the- certified visual media 
production. Upon determining compliance by the visual media production company, the 
department shall issue to the company a tax reimbursement and credit certificate. The tax 
reimbursement and credit certificate ~ 
entitles the visual media production company 
to claim the reimbursement provided by Title 36, chapter 919 A and the credit under Title 
36, section 5219 Y 5219-DD. The tax credit certificate must indicate whether the visual 
media production company is eligible for' a Level 1 credit. under Title 36, section 
5219-DD, subsection 1 or a Level 2 credit under Title 36, section 5219-DD, subsection 2. 
5. Department to provide information to State Tax Assessor. The department 
shall provide to the State Tax Assessor copies of tax reimbursement and credit certificates 
issued in accordance with subsection 4, together with any other information reasonably 
required by the State Tax Assessor for the administration of media production 
reimbursement under Title 36, chapter 919 l'" and the credit under Title 36, section-5U-9--
¥ 5219-DD. 
6. Rulemaking. The department shall develop rules as necessary to administer this 
section in yooperation with the State Tax Assessor. 
Rules adopted pursuant to this 
section are routine technical rules as defined in chapter 375, subchapter 2-A. 
Sec. 2. 36 MRSA §191, sub-§2, ~ 
as enacted by PL 2007, c. 693, §9, is 
amended to read: 
KK. The disclosure to an authorized representative of the Department of Economic 
and Community Development of information required for the administration of the 
visual media production credit under section 5219 Y 5219-Db, the employment tax 
increment financing program under chapter 917, the media production reimbursement 
program under chapter 919 l"L or the Pine Tree Development Zone program under 
Title 30-A, chapter 206, subchapter 4. 
See. 3. 36 MRSA §5219-Y, as enacted by PL 2005, c. 519, Pt. GG, §2, is 
repealed. 
. Bee. 4. 36 MRSA §5219-DD is enacted to read: 
§5219-DD. Certified visual media production' credit 
A visual media production company that has received a tax credit certificate under 
Title 5, section 13090-L, subsection 4 is allowed a credit against the taxes imposed by 
this Part as provided in this section.. 
. 
1. Levell credit. A visual media production company with visual media production 
expenses of more than $50,000 but less than $750,000 is allowed a credit equal to 10% of 
visual media production expenses for the visual media production or 15% of the visual 
. 11 
media production expenses if the visual media production company has been 
incorporated in the State for at least 2 years on the date that production begins. 
2. ' Level 2 credit. A visual media production company with visual media production 
expenses of $750,000 or more is eligible for a credit equal to 20% of visual media 
production expenses for the visual media production. 
A visual media production 
company with visual media production expenses of $750,000 or more is eligible for 
additional incremental credits as follows: 
A. One percent of visual media production expenses if the visual media production 
company hires 15% or more of its cast and crew in the State; 
. 
B. Two percent of visual media production expenses if the visual media production 
company shoots- or produces at least 25% of the project time in Aroostook County, 
Franklin County,· Oxford County, Piscataquis County, Somerset County or 
Washington County. Project time includes days of preproduction, production and 
postproduction; and 
25C. Two percent of visual media production expenses ~f the visual media production 
company participates in an internship program· overseen by the Department of 
Economic and COlnmunity· Development, Office of. Tourism, Maine State Film 
Office and a public institution of higher learning. 
3. Refundable. The credit provided by this section is refundable·. 
4. Limitation. The credit available under this section may not exceed $3,750,000 
per visual media woduction: 
5. Definitions. Terms defined under Title 5, section 13090-L apply to this section. 
Sec. 5. 36 MRSA c. 919-A, as amended, is repealed. 
Sec. 6. Low-interest loan, program. The Finance Authority of Maine shall 
establish a low-interest loan program for visual media production companies with visual 
media production expenses of $750,000 or greater that receive a visual media production 
certificate under the Maine Revised Statutes, Title 5, section 13090-L, subsection 3-A. 
) 
) 
) 
~ 
~, 
) 
; 
L 
. 
Interest rates under this program may not exceed rates paid by the State for bOITO\ying 
money. 
SUMMARY 
TIllS bill makes changes to the State's incentives to provide more effective strategies 
for attracting visual media productions to the State. It changes the refei'ences to "media 
production" to "visual media production." The existing income tax credit and 
reimbursement for certain production wages are replaced with a refundable income tax 
credit that is a percentage of direct production expenditures in the State. 
Eligible 
productions must be certified by the Depmiment of Economic and Community 
Development. 
Productions with expenditures of Inore than $50,000 but less than 
$750,000 are eligible for an income tax credit of 10% of expenditures or 15% if the 
production cOl1'lpany has been incorporated in the State for at least 2 yeaI,"s. A production 
company with eligible expenses of $750,000 or more is eligible for a base credit of 20% 
of eligible expenditures with incremeI).tal increases if the company hires at least 15% of 
its cast and crew in the State, spends at least 25% of the project time in certain counties or' 
participates in an internship program overseen by the Department of Econonllc and 
COrTImunity Development, Office of Tourism, Maine State Film Office. The Finance 
Authority of Maine is directed to establish a low-interest loan program for visual media 
production companies with visual media production expenses of $750,000 or greater that 
receive a visual media production certificate.