LAS VEGAS (KTNV) — Nevada lawmakers on Thursday got their first look at a bill that would supply more than $1.5 billion in tax credits over 15 years in order to lure movie and TV production to the state.
The bill — Assembly Bill 238 — could see the creation of a movie studio in Summerlin as a partnership between the Howard Hughes Corporation, Sony Pictures and Warner Brothers/Discovery.
Before they could get the credits, however, the studios would have to spend money to build the studio, hire workers and complete production on projects. And other language in the bill would lead to job training for film industry positions and requiring hiring at least half of workers from Nevada.
Assemblywoman Sandra Jauregui, D-Clark County, said she sponsored the bill not only to create jobs, but an entire new industry in Nevada, one that would be less subject to the economic ups and downs that often afflict the state's tourism and gambling businesses.
"At its core, AB 238 is about investing in Nevada's future, creating opportunities for hardworking Nevadans, growing and diversifying our economy and establishing a long-term sustainable industry that will benefit our community for decades," Jauregui said.
And the bill's co-sponsor — Assemblywoman Daniele Monroe-Moreno, D-Clark County — said the education offered for students was a key feature of the bill.
"The next Denzel Washington may come from Nevada students," she said.
Under the bill, starting in 2028, the state would offer $105 million per year for 15 years — more than $1.5 billion — for films produced at the Summerlin studio.
According to an economic estimate by analyst Guy Hobbs, state and local governments would get back more than $754 million in tax revenue over that period.
Additional tax credits would be available for independent filmmakers not affiliated with the Summerlin studio.
Representatives of Howard Hughes, Sony and Warner Brothers said they planned to make a sizable investment in Nevada.
David O'Reilly, CEO of Howard Hughes, said the project would have an economic impact of $2.8 billion during its construction and $3 billion per year once the studio is finished and projects are underway. Those investments would have to be complete before tax credits could be realized.
"There's been no other project that I've seen that creates so many jobs and drives the economy as much as this one does," O'Reilly said. "The average salary for a production employee is $113,000 plus pension and benefits, which is nearly double Nevada's average salary."
During public testimony, members of organized labor said they supported the measure because of the potential for jobs for their members, not just in construction but also for filmmaking.
Despite the benefits, however, the bill still faces hurdles.
First, Gov. Joe Lombardo has said he has concerns about the proposal, at least as it was previously proposed. Although the current two-year budget contains no tax credits since they would not take effect until 2028, the state would still be making a long-term commitment to the idea.
Second, there's a rival bill. State Sen. Roberta Lange, D-Clark County, who authored a similar proposal that did not get a hearing at the end of the 2023 session, is bringing a similar bill this year.
But Lange's proposal lost a key backer when Warner Brothers signed on with the Howard Hughes/Sony plan. She's now joined up with a company called Manhattan Beach Studios instead. Other groups supportive of her bill, including UNLV and the College of Southern Nevada, testified in support of Jauregui's bill at the end of Thursday's hearing.
WATCH: Steve Sebelius explains each film bill and what it would do
Third, there's opposition. Progressive groups, Americans for Prosperity and the Nevada State Education Association all came out against the bill, saying it would take money away from other needs such as domestic violence programs, education and other needs.
The education association — which opposed taxpayer support for the Oakland A's stadium in Las Vegas under the banner "Schools over Stadiums" — announced the phrase "schools over studios" at the hearing.
Jauregui, in her closing comments, said it was a "false choice" to pick between those other needs and a studio project. She said it would generate tax revenue for education, and the other benefits of the project would not exist if the studio didn't build in Las Vegas.
Meanwhile, the Clark County Education Association — a bitter rival of the state education association — testified as neutral on the bill, saying it wouldn't close the door on the proposal yet and would remain engaged in the debate.
The bill has until April 11 to pass out of the revenue committee and still faces votes on the Assembly floor and hearings and a vote in the state Senate before it goes to Lombardo for consideration.
We'll keep following developments and bring you the latest we find out. If you have questions about how any of this would work — or any other questions about Nevada politics — submit them to Steve Sebelius on ktnv.com/asksteve.
Local News
