Can Nevada afford to become Hollywood 2.0?

Backers of expanded film tax credits defended their proposal Friday against questions about the program’s possible impact on state finances.

The hearing for Assembly Bill 238 in the Assembly Ways and Means Committee came about a week after a economic forecast predicted $191 million less general fund revenue than forecast in December, leaving some lawmakers concerned about extending further tax credits in an uncertain environment.

“Let’s say that we get yet another Economic Forum with this similar outlook that we had just last week, is this date set in stone?” Assembly member Natha Anderson, D-Sparks, asked the bill sponsors, referring to the date tax credits can become available in 2028.

It appears to be a widespread enough concern that the bill’s co-sponsors — Assembly members Sandra Jauregui, D-Las Vegas, and Daniele Monroe-Moreno, D-North Las Vegas — said they are working on a conceptual amendment “to further put guardrails into the bill,” Jauregui said. It is expected to be presented during the bill’s future work session.

The push to bring Hollywood 2.0 to Southern Nevada would be a major expansion of the state’s film tax credit program, which is capped at $10 million in production credits available annually under current law. But AB 238 proposes expanding the program to $120 million, with $95 million that is specifically tied to the construction of a film studio in Southern Nevada.

Some legislators also asked how a recent tax credit awarded to WWE for WrestleMania at Allegiant Stadium on April 19-20 would have been affected by the proposed film tax credit program expansion. Fiscal analysis staff said the $4.2 million tax credit could have grown to $8.3 million under AB 238 because of the bill’s increased qualifying expenditures and its removal of a $6 million cap per production.

AB 238 is tied to Summerlin Studios, a proposed joint venture between Sony Pictures Entertainment, Warner Bros. Studios and Howard Hughes Holdings, the developer. If approved, the two media conglomerates would both fund the estimated $1.8 billion studio project to be located near Town Center Drive and Flamingo Road.

Consultants for the Summerlin Studios project say the bill has a 20 percent fiscal return to the state’s general fund. The state could get $335 million in tax revenue on the $1.65 billion tax credits available over the 15-year program, according to a report from PFM Group Consulting. It said the studio’s economic impact could be about $3 billion once construction is complete.

“There are other tax credits in other states where they come in, and they film a movie and they leave,” Monroe-Moreno said during the hearing. “In this bill, they’re actually building a studio, a village, in our state, an investment in our state, an investment in our workers, an investment that will put money back into that education system.”

AB 238 still must be voted out of Ways and Means before the 42-member Assembly votes. A second bill in the Legislature this session, Senate Bill 220, also proposes to expand the film tax credit program tied to the development of a film studio at Harry Reid Research and Technology Park near Sunset Road and Durango Drive in southwest Las Vegas.

Contact McKenna Ross at mross@reviewjournal.com. Follow @mckenna_ross_ on X.