California Lawmaker to Introduce Postproduction Tax Credit Bill

Assemblymember Nick Schultz aims to make California more competitive for editing, VFX, and sound work.

Published on Feb. 5, 2026

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California State Assemblymember Nick Schultz plans to introduce legislation that would create a standalone tax incentive for postproduction work in the state, including editing, visual effects, and sound mixing. This comes after a successful effort in 2025 to expand the state's overall film and TV tax credit program from $330 million to $750 million. Industry groups say the lack of a dedicated postproduction credit has led to a decline in that work in California as other states and countries offer more attractive incentives.

Why it matters

California has long been the center of the entertainment industry, but it has seen a decline in postproduction work as other regions offer more competitive tax credits. This proposed bill aims to help keep more of that high-skilled, well-paying work in the state and prevent further erosion of the local industry ecosystem.

The details

Assemblymember Schultz plans to introduce legislation that would create a standalone tax credit for postproduction expenses like editing, visual effects, and sound mixing. Currently, those costs can only qualify for California's film/TV tax credit program if the physical production also takes place in the state. This new bill would make postproduction eligible for incentives on its own, helping California compete with places like New York, Georgia, the UK, and Australia that already offer such credits. Industry groups say the lack of a dedicated postproduction credit has led to a more than 11% decline in California's share of US postproduction work between 2010-2024, along with a nearly 17% drop in payroll employment in the sector.

  • In 2025, California expanded its overall film and TV tax credit program from $330 million to $750 million.
  • Assemblymember Schultz plans to introduce the new postproduction tax credit bill in the near future.

The players

Nick Schultz

A California State Assemblymember who plans to introduce legislation creating a standalone tax credit for postproduction work in the state.

California Post Alliance (CAPA)

An organization dedicated to attracting more postproduction work to California, which has been lobbying for this new tax credit.

Peter Rotter

Founder of Encompass Music Partners and Encompass Creative, who wrote an open letter in 2025 warning that "the infrastructure of the L.A. recording industry [was] about to fail" due to the decline in local postproduction work.

Karen Baker Landers

A two-time Oscar-winning sound designer who says she has lost four to five jobs due to California not offering a standalone postproduction tax credit.

Jennifer Freed

Founder of Trevanna Post and Trevanna Tracks, a postproduction company with offices in London, New York, and Los Angeles, who has witnessed the production exodus on her company's balance sheet.

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What they’re saying

“We must now take a moment to turn the camera and the light and shine it on us. We now need to tell our stories.”

— Marielle Abaunza, President, California Post Alliance (The Hollywood Reporter)

“Families can't pay their rent on what little work is left. Editors are driving Uber instead of cutting reels. Sound designers are selling gear just to eat. The whole ecosystem is bleeding out and no one's coming back.”

— Peter Rotter, Founder, Encompass Music Partners and Encompass Creative (The Hollywood Reporter)

What’s next

Assemblymember Schultz is expected to formally introduce the postproduction tax credit bill in the California legislature in the coming weeks or months.

The takeaway

This proposed legislation represents a crucial effort to keep California competitive in the high-skilled, well-paying postproduction industry, which has seen an exodus of work to other states and countries offering more attractive tax incentives. If passed, it could help stem the tide and preserve California's status as the center of the entertainment industry.