As stated in our previous blog entry, we have returned to using Grok AI with the AB238 and SB220 Film Tax Incentive bills in order to produce the most efficient and focused versions to benefit all parties involved in Nevada’s development into a new film and media production hub. The result has been a potential breakthrough with the most streamlined and efficient bill to date that not only advances Nevada’s current film program but also adds the most unique feature of providing direct film and media infrastructure incentives across production, distribution, and exhibition!
Our Changes
So far we have produced bills that:
- Removed DEI language and practices from the bill.
The Result: The bills no longer placed “minorities and underserved groups” as its workforce development focus and instead the bills returned the focus to establishing a new workforce of Nevada citizens with new pathways for professional training in film and media production. Unnecessary quotas and inappropriate application diversity requirements were also removed to unburden the process of applying for film tax incentives as well as preserving normal production documentation practices without additional confusion and restrictions. It also removed the unusual forced diversity restrictions for grant creation if annual funds are left over.
- Added Babs Do Studios into each bill as another studio developer.
The Result: With Babs Do Studios included as an additional developer rather than one single studio, the bills each offered a significant boost in economic benefits, job creation, professional training, and timeline for development with Babs Do Studios being able to be built within months in 2025 as compared to the 2028 and 2029 completion dates for Summerlin Studios and Nevada Studios respectively.
- Added additional infrastructure line items that included movie theaters, film festivals, streaming network development, and others that can be approved.
The Result: The added infrastructure categories allows builders to provide interconnected channels of distribution and exhibition to aid Nevada’s film studios to have new local and statewide distribution options as well as to be able to engage the public directly with local screenings, large venue developments, and other related film and media events originated in Nevada on both a physical and digital basis.
- Combined AB238 and SB220 into a single bill with all of the adjustments.
The Result: The bills presented a large collection of economic development that would provide unheard of levels of nearly immediate economic impact, job creation, and development for Nevada with a shared incentive strategy to benefit all studio and infrastructure developers with their respective development incentives, timelines, and commitments.
With all of these changes, both bills were already far stronger bills than they were initially and, when combined, they presented an impressive powerhouse of potential development legislation that supported Nevada’s development and, most importantly, tax-paying Nevada citizens. So, what was left?
After listening to the discussions at the hearing for Assembly Bill 238, most of the issues with the bill could be answered with our Grok AI-enhanced changes but one comment about the bill’s ability to compete against other state programs stood out. While AB238 and SB220 have the potential to be great bills, we wondered if there was still something off with them despite potentially including our changes. The answer we found was obvious once we applied this one change.
- We removed all studio developments from the bills.
The Result: By removing Summerlin Studios, Nevada, Studios, and Babs Do Studios from the bills, both texts were shortened from 30+ pages into streamlined and easy to read 14 and 15 page bills that were essentially the same bill. This new unified bill presented a universal and open Film Tax Incentive bill that provided incentives to any developer and producer who wanted to build and create film and media projects in Nevada with a simplified 50/50 split between infrastructure transferable tax credits and noninfrastructure transferable tax credits with an example budget of $200 Million Dollars and a $25 Million Dollar cap on Infrastructure developments and $12 Million Dollars cap for Productions. While this amount may not directly pay the same significant amounts presented for Nevada Studios and Summerlin Studios in the original bills, it does offer a fair and workable amount to cover startup and continuing development costs for all currently interested Nevada-based film studio developments while also opening the door for continued innovation with additional infrastructure items as well as providing for any other future film studio developments from other companies such as Disney, Netflix, Paramount, Amazon, and others including new local Nevada studio projects. With Warner Bros. and Sony Pictures combining efforts, it could also provide an opening for both studios to split development and receive combined incentives which would allow for increased efficiency and development flexibility.
Our Reasoning
The removal of the studios was simply because of practicality as, when examined closely, there were effectively no reasons to include Summerlin Studios or Nevada Studios in AB238 or SB220 as both bills are being presented as Film Tax Incentive programs. As Film Tax Incentive programs are designed to service all applicants across Nevada, putting a singular Las Vegas-based studio development in the same bill that outlines the very process of presenting infrastructure proposals, including studios, to the Nevada Office of Economic Development seemed unnecessary and potentially legally unethical by monopoly.
The thought was, if Nevada Studios and Summerlin Studios wanted to submit their studio proposals, they should follow their own bills at the base level and have their project approvals and incentive amounts determined by the elected body they seek to create to handle film and media infrastructure and noninfrastructure projects. This way, the bills are not structurally dependent on Summerlin Studios or Nevada Studios, their allocation of incentives, building timelines, or other program commitments and by removing them, it frees the bills to provide solutions for all studio developments.
These “Studio-less” versions of the bills and their core unified structure present the most streamlined and simplified path for Nevada to establish a truly competitive Film Tax Incentive bill that would ensure significant development in the state including far greater job creation, production capacity, and business growth in film and media that could exceed the capabilities of all other programs in the country.
The Problem
As stated in our previous post, the current versions of the bills with their banner studios written into their text presents a perilous and unfair business situation. The respective texts state that infrastructure incentives are held off until either Summerlin Studios or Nevada Studios are built in 2028 and 2029 and, in both bills, that the current program for film production will be upgraded to the new noninfrastructure standard this year in either July 1st, 2025 or October 1st, 2025. In this approach, whether film and media production is taking place or not, the bills prevent any other entity, group, or company from building film studios and other infrastructure in the state for at minimum 3 years. The logical and practical problem with this is that the entire reason these bills were proposed in the first place was that Nevada could not compete with other states in film and media production precisely because there is no major film and media infrastructure in the state!
Therefore, the bills immediately fail the new production incentive program they seek to establish as the production incentives could go woefully unused for 3 years for failing to quickly solve the core fundamental issue of a lack of film and media infrastructure in the state, let alone Las Vegas.
Once again, this is the reason why we have developed Babs Do Studios to be a quick to build and economical solution to this lack of film and media infrastructure as well as to provide industry innovation while also being a new entertainment production studio all of its own. While there is nothing wrong with Summerlin Studios and Nevada Studios being built by traditional methods compared to our faster new age approach, the opportunity to partner with us to fix this glaring issue has been available well before AB238 and SB220 were presented. In the current state of the industry, especially for what Hollywood 2.0 could be, there is no need to compete, especially on fresh ground in Nevada. Now, instead of working together, the entire Nevada Studios project has been fractured and split into two competing groups and the two similar competing bills have presented the same fundamental flaw, leaving Babs Do Studios and Nevada’s future as a film and media production hub caught in the middle.
The Solution
However, all of this can be changed with the right revisions and adjustments, possibly a unification of developments into one single bill, and, if necessary, to establish a shared budget number that works for all involved whether it is $100M, $200M, or even $300M. As the Nevada Legislature has indicated before, the costs of this film and media development is in question but with 2025 state competition in mind and the number of production studios and potential big name parties interested including Nevada-born studios like Babs Do Studios and Nevada Studios in the mix, the concern for costs have to take a back seat to the overall massive economic impact this can provide.
As there is only so much time before the Nevada Legislative session ends on June 2nd, there has to be some significant decisions made for the sake of Nevada artists, citizens, and businesses that will all benefit from the potential new job creation, economic impact, and new creative business opportunities this film and media legislation can provide. The entire entertainment industry will also be potentially affected as well in a positive way if everything is handled properly as Nevada can present a compelling new hub for film and media production and potentially as the home base of Hollywood 2.0!
We hope that, in any case, Babs Do Studios will be involved and up and running as part of this new future for Nevada. With more developments sure to come in the days, weeks, and months ahead while the Nevada Legislature is in session, we will be actively working to help bring the best outcome for Nevada citizens and to foster the most fair and beneficial solution for all parties involved in this endeavor. Stay tuned!
