Hollywood 2.0What’s Ahead for Nevada’s Film Industry?

 

Nevada locales have been featured in movies for many years – from the Landmark implosion in “Mars Attacks”, to the Reno Arch in “Sister Act” and Lake Tahoe as the final resting place of Fredo Corleone in “The Godfather, Part II”. Television shows like “Reno 911” and the original “CSI” series are set in Nevada, but most of what viewers see on the screen has actually been filmed in other states. Two bills being introduced in this year’s legislative session aim to bring more film production to Nevada by increasing the tax credit given to companies that produce movies and television programs here.

“Some location shoots are done here because of our unique physical assets like the Las Vegas Strip, but a lot of filming is done in studios elsewhere,” said Tom Burns, executive director of the Governor’s Office of Economic Development (GOED). “A production company considers two primary factors when choosing where to film: the creative (what locations does the story call for?) and incentives (how cost-effectively can this film be made?). Sometimes the incentives will matter more than the creative. For instance, Fox’s “The Cleaning Lady” takes place in Las Vegas.

They come here for exterior shots, but the show is primarily filmed on sound stages in New Mexico, for two reasons: we don’t have large sound stages here, and we’re not competitive with our tax incentive program. [Film makers] could shoot here, but they choose not to. The states with the competitive incentive programs will continue to get the industry’s business.”

Burns explained that tax credits are offered only for qualified expenses incurred during the production of films. “We offer incentives for filming in Nevada, but not for construction of facilities to film,” he said. As film companies work on a project in Nevada, they incur expenses such as salaries for cast and crew, equipment rentals, wardrobe, travel and vehicles, hotels and catering.

After the project is completed, they submit their receipts to GOED, which audits their paperwork. If approved, GOED provides the project owner with a certificate in a dollar value equal to a percentage of the expenses they incurred producing the film. “For lack of a better word, the certificate is a coupon issued from our office that a company can use to pay future taxes in Nevada,” said Burns. “While it isn’t cash, it’s transferable and could be sold to another film maker.”

Kim Spurgeon, director of the Nevada Film Office (NFO), a division of GOED, explained that Nevada’s current tax incentive program for film makers was passed in the 2013 legislative session and enacted on January 1, 2014. It offers a base rate of 15 percent and caps annual tax incentives at $10 million.

“For the last 11 years, we’ve been able to attract primarily low-budget, independent features and reality TV shows,” she said. “We rely heavily on what Nevada has to offer organically – its locations.”

Even the relatively low level of film making that takes place here generates business for a wide variety of Nevada companies. NFO’s 2024 Annual Report estimated that spending on film productions in Nevada generated an economic impact of $15 for every tax credit dollar allowed. Besides the economic impact, film making can also help with workforce development and economic diversification. “The industry creates career opportunities for Nevadans,” said Burns. “These are high-wage union jobs that don’t require a college degree. With the dozens and dozens of job types on a film set, nearly any skill set can find a role to fill, and the low barrier to entry creates opportunity for traditionally underrepresented groups.”

Nevada’s current program is not competitive compared to other states or regions throughout the world, according to Burns and Spurgeon. New Mexico does not have an annual cap on tax credits for studio partners, New York offers a $700 million annual cap, and California has a cap of $350 million, with a proposal in the works to double that amount. “Georgia offers $1.3 billion in tax credits per year, with no annual cap,” Spurgeon said. “That’s why you see the Georgia logo in the credits at the end of so many films and TV shows. That couldn’t happen in Nevada. The Legislature is required to approve a balanced budget, and the cost of tax credits has to be accounted for somewhere in the budget as a line item, In Nevada, that $1.3 billion would have to be a line item in the budget. We don’t have the ability to do it because of the way the state operates.”

Tony Vinciquerra, chairman of Sony Pictures Entertainment, which is partnering with Howard Hughes on a studio project in Summerlin, said, “It’s not like building a school or a stadium where the state writes a check before they start construction. Sony and Howard Hughes first have to spend half a billion dollars to build the facility. We’re not asking the state to put up any money for that. Then, the first film or TV show that gets produced in southern Nevada will spend money housing people, building sets, etc. We’ll spend $10 million on the movie before we go to the state and say, ‘Would you approve giving us an incentive for this?’ The state has already seen all the money come in before we apply for the incentives. It’s a different concept than people are used to seeing, and it’s often difficult to make them understand. Unless you spend the money on production, you won’t get any tax credits.”

Battle of the Bills

During the 2023 legislative session, a tax credit bill for film making was introduced, but never made it out of the finance committee. Two competing groups with plans for large studios in southern Nevada are promoting bills in this session. Each group has partnered with a legislator to carry a bill that would allocate a certain amount of tax credits for producing film projects on their proposed sites. A small percentage would be reserved for other projects, which could include those elsewhere in the state. “Both new projects are contingent on the current tax incentive program changing,” said Spurgeon.

Senator Roberta Lange, D-Las Vegas, who sponsored last session’s tax credit bill, is sponsoring a bill aimed at not only bringing film makers to Nevada, but also supporting education and workforce development by partnering with UNLV. In this bill, tax credits would be increased to 30 percent and capped at $115 million a year for 15 years, with $100 million set aside for production at Nevada Studios, planned for the UNLV Harry Reid Research & Technology Park in northwest Las Vegas. The $800 million, 34-acre project would include 14 sound stages and a five-acre backlot with a mill shop, studio operations space and equipment area. An additional 14 acres in the tech park would be reserved for a hotel, office space and mixed-use retail.

The land for the project is owned by the UNLV Research Foundation, which will ground-lease it to Birtcher Nevada Development, an entity of Birtcher Development, which is based in Newport Beach, CA. Birtcher will own the sound stages and act as developer for the project, managing all the construction aspects of bringing the project to fruition. Brooke Birtcher Gustafson, president of Birtcher Development, estimated that if the bill is passed, construction permits could be finalized by Q3 2025, with construction beginning early in 2026 and phased openings planned for 2027.

Originally, Warner Brothers Discovery had expressed interest in partnering with UNLV for film production at Nevada Studios. They financed an economic impact study estimating the project would create about 1,800 construction jobs. Once up and running, it would provide about 16,500 long-term jobs for the film industry with a wage profile 35 percent higher than the average Nevada wage.

According to Gustafson, Warner Brothers decided in mid-December 2024 to “take a pause” and not continue with the partnership. However, she is confident that Birtcher will have no problems filling the studio with film projects. “In November 2023, we entered into an agreement with The MBS Group, one of the largest studio operators in the world,” she said. “When a company like Lucasfilm or Netflix is planning a film, they usually contact MBS first to find studio space. They will be our operating partner, making sure that Nevada Studios are 100 percent full.”

The centerpiece of Nevada Studios will be the 50,000-square-foot Nevada Studios Media and Technology Lab. UNLV film students would spend two years on the university campus, followed by two years at Nevada Studios, gaining hands-on experience. “We’ll serve a consortium of schools and also create vocational technology opportunities for southern Nevada,” said Gustafson. The UNLV project has already received buy-in from College of Southern Nevada (CSN), Nevada Southern University, (NSU) and the Clark County School District. It would also allow adult learners to continue their education and further their film-related careers.

“In terms of crew base, we currently have a brain drain,” said Spurgeon. “After graduating from UNLV or CSN, film students can’t find enough work here to sustain their careers, so they move to LA or to one of the states where more filming is happening.”

Summerlin Production Studios

Assemblywoman Sandra Jauregui, D-Las Vegas, is sponsoring a bill with $105 million in tax credits. $80 million would be reserved for film and TV projects at a studio planned for Summerlin. Before being eligible for the tax credit, the developers would have to spend $500 million on constructing the studio project and an additional $100 million on producing films there. Tentatively named Summerlin Production Studios, the $1.8 billion project is a partnership between Sony Pictures Entertainment and Howard Hughes Holdings, a division of Howard Hughes.

David O’Reilly, CEO of Howard Hughes, said plans for the 31-acre site at Town Center near I-215 call for 10 sound stages and a two-acre back lot with ancillary buildings that include a catering kitchen and production offices. Howard Hughes also owns more than 60 acres at the same location, which they plan to develop into a mixed-use project with retail space, office buildings, an urgent care medical center, and restaurants.

Howard Hughes Holdings will be the landowner and real estate developer, according to O’Reilly. The joint venture will be the landlord and will rent space to production companies, including Sony. “The plans have already been approved by Clark County,” he said. “It’s shovel-ready.”

A study by Hobbs, Ong & Associates estimated that construction of the studio project will provide about 19,000 jobs, and once it begins to operate at full capacity, it will add 15,000 permanent jobs with an annual average salary of $113,000. Most of the workforce will consist of skilled labor such as electricians, carpenters, makeup artists, and set designers. The study predicted an economic impact of $2.87 billion during the construction phase and $2.85 billion in annual impact once it’s up and running.

“No other project we’ve seen will create so many jobs and drive the economy as much as this does,” said O’Reilly. “While this will be a nice project for Howard Hughes, the real benefit is that people who come here will need places to live, places to shop, schools, cars, and restaurants. It will create positive growth and economic diversification. The Hobbs study estimated Nevada will receive $34 in economic return for every dollar of tax credit issued.”

Is Legislative Compromise Possible?

“To grow the firm making industry in Nevada, we need a competitive tax incentive program, as well as the infrastructure and the space to film in sound stages,” said Spurgeon. “Once we have the space, then we can attract the volume of work, the local crew will start to grow, and the services companies will start to expand or move here.”

However, the infrastructure needed to create films depends heavily on a tax incentive structure that will attract large companies like Sony Pictures. “If you’re not going to shoot in LA, Nevada is the most reasonable place, especially if you‘re shooting a film, where you have to be away from home for three months at a time,” said Sony’s Vinciquerra. “Actors, directors, and other people who are working fulltime in the production and live in southern California would like to be shooting in Nevada because they can easily go home on weekends. However, if the bill [proposed by Jauregui] doesn’t pass, then we’ll have to move on to another state. Nevada’s the preferred solution, but if there aren’t any incentives, it’s not going to work.”

In effect, legislators will have to decide whether the state is willing to allocate tax credit funds in order to allow either of the proposed projects to move forward. “I don’t think there’s a way to split the baby,” said Burns. “Just speculating, I don’t think there’s space for two bills to co-exist. It’s critical that the issues at hand are discussed and considered by the Legislature in totality, and I’m certain that will happen.”

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Film Making in Northern Nevada

“People don’t have any idea how much film production takes place in northern Nevada,” said Emily Skyle-Golden, founder and executive director of the Reno-based Cordillera International Film Festival. “Although we’re not a short drive from LA like Las Vegas, we’re only an hour away by plane. We don’t have large sound stages, but we do have smaller spaces and larger spaces that can be converted temporarily for filming, and we have an untapped resource of locations in a variety of settings.”

Several Hallmark and Lifetime movies have been filmed in Reno and Lake Tahoe, as well as national ad campaigns, and the Knuckles TV series is based in the National Bowling Stadium in Reno. “Reno native Jeremy Renner has showcased Reno in his Rennervations TV miniseries on Disney+,” said Skyle-Golden. “Film Northern Nevada is a volunteer organization whose members facilitate bringing productions into the region. We helped Jeremy find locations and hire local crew.”

Now in its eighth year, Skyle-Golden’s film festival provides an environment for emerging and established artists in film and digital media. Last year, the festival received about 8,000 submissions from 83 countries. “To create a thriving film community, you need a world-class film festival, because that’s how you get studio executives to come in,” explained Skye-Golden.

The last day of the festival is reserved for Film Nevada Day. “We take the executives to locations that would be good for films and encourage them to get excited about the possibilities of filming in northern Nevada,” said Skyle-Golden. Film festival participants have visited Virginia City, the (vacant) Carson City prison, the Aces Ball Park, Lake Tahoe, Genoa, and several other locations.

Skyle-Golden is optimistic about the future of film production in northern Nevada if either bill passes. “We lose a lot of projects because we don’t have a more advanced tax incentive program,” said Skyle-Golden. “[Providing higher tax incentives] will open a large window of opportunity for the region. We have a city and a region that are excited to help film happen.”