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Minutes for HB2038 - Committee on Taxation
Short Title
Enacting the Kansas film and digital media industry production development act, providing a tax credit and sales tax exemption to incentivize film, video and digital media production in Kansas, establishing a program to be administered by the secretary of commerce for the purpose of developing such production in Kansas and requiring the secretary of commerce to issue reports to the legislature regarding the program.
Minutes Content for Tue, Feb 4, 2025
Chairperson Smith opened the hearing for HB2038.
Adam Siebers, Office of Revisor of Statutes, provided an overview for HB2038 that creates the Kansas Film and Digital Media Production Development Act. The Act provides tax incentives for eligible projects produced in Kansas for the purpose of developing the film and digital media industry in Kansas.The Act would be administered by the Secretary of Commerce with the assistance of the Kansas Creative Art Industries Commission. (Attachment 1) Mr. Siebers stood for questions from Committee members.
Kathleen Smith, Kansas Department of Revenue, provided an overview of the fiscal note, stating HB2038 would decrease the State General Fund revenues by $10.0 million in FY 2026, and in each future fiscal year through FY 2035.
In response to a question, Ms. Smith noted if terms of the agreement are broken and credits had been transferred or sold, she assumes the Department would probably go after the investor.
Proponents:
Stuart Litttle, Little Government Relations, testified as a proponent on behalf of Grow Kansas Film for HB2038. He noted in response to a previous question regarding the application process, the filmmaker goes through approval for the project, filmmaker does the project, and then goes back to the Department of Commerce. Mr. Little stated everything matches up then you receive the tax credit and it is not the money upfront. HB2038 is an economic development tool to support creative arts and build a strong lasting workforce in the state of Kansas. (Attachment 2
Kristen Bush, Kansas Filmmaker, testified as a proponent for HB2038 stating she is a professional actor who has been in over fifty films. Ms. Bush noted the film industry has been de-centralizing out of Los Angeles and the fires last month will push more filmmakers out of California. The number one reason for choosing film locations is tax incentives. Kansas does not make it easy for its creative young people to stay in the state of Kansas without tax incentives. (Attachment 3)
Justin Rorabaugh, School of Digital Arts and Shocker Studio, Wichita State University, testified as a proponent for HB2038. Mr. Rorabaugh provided an update on the University's new Bachelor of Applied Art in Media Arts program and the growth is currently 550 students and projected to be over 1,000 in the next four years. He noted Kansas does not have regular film and television production opportunities for the students to work on. With the passage of HB2038, we can keep the creative workforce that is being developed and trained here in Kansas. (Attachment 4)
Justin Begnaud, Kansas resident and also a film, television and digital media producer testified as a proponent for HB2038. He stated as a producer it is instrumental in finding the location and to find the money which can be in the form of private investors, grants, gifts, bank loans against distribution contracts and tax incentives. To find a location where the tax incentive is a win for the producer. Mr. Begnaud noted Kansas does not have any form of tax incentive which is the reason he had to leave this region. Now is the time to provide an incentive to film in Kansas. (Attachment 5)
Shawn Rhodes, R3 Store Studios US, Wichita, Kansas, testified as a proponent for HB2038. Without passing the bill, Kansas will be at disadvantage to surrounding states. HB2038 can build this money-making industry right here in Kansas. (Attachment 6)
The conferees stood for questions from Committee members.
Proponent written testimony was submitted by the following:
Natalie Bright, Travel Industry Association of Kansas (TAK), (Attachment 7)
D. Mitch Robinson, Kansas Economic Development Alliance, (Attachment 8)
Juliet Abdel on behalf of Visit Topeka, (Attachment 9)
Katrina Abraham, KC Chamber, (Attachment 10)
Rachael Willis, Department of Commerce, (Attachment 11)
Lily Wu, Mayor, City of Wichita, (Attachment 12)
Paul Dechant, Filmmaker and Podcast Producer, (Attachment 13)
Alan Carr, Executive Director Visit KCKS, (Attachment 14)
Maxwell Thomas, "Lights On", (Attachment 15)
Tyler Emerson, Conlee Schmidt & Emerson, (Attachment 16)
Joshua Wexler, Pure Imagination Studios, (Attachment 17)
Neutral:
Written testimony as neutral to HB2038 was submitted by Spencer Duncan, League of Kansas Municipalities. (Attachment 18)
Opponent:
Written testimony as an opponent to HB2038 was submitted by Dave Trabert, Kansas Policy Institute, (Attachment 19)
Chairperson Smith closed the hearing for HB2038 and adjourned the meeting.
