Section 485A of the Texas Government Code enacts the Media Production Development Zone Act (the Act), administered by the Texas Film Commission. The Media Production Development Zone (MPDZ) is designed to encourage the development of permanent moving image production sites to help strengthen the Texas economy. This incentive program not only supports growth of the media industry, but also brings about tangible investment in assets that strengthen the local tax base. It also provides an opportunity to continue implementation of the City of Fort Worth Economic Development Strategic Plan's goal to become a hub for creative businesses.
MPDZ allows for a two year sales and use tax exemption for the construction, maintenance, expansion, improvement, or renovation of a media production facility at a Qualified Media Production Location in a designated Media Production Development Zone.
The City of Fort Worth and the area within the Southside TIF will meet the criteria for recognition as a MPDZ under the Act so long as a Qualified Media Production Location is designated within that area. The exact boundaries of the proposed zone are described in Exhibit A of the attached ordinance designating the Zone.
Under the Act, the governing body of a municipality, by ordinance, may nominate a location as a Qualified Media Production Location if the location is situated in a MPDZ.
To be designated a Qualified Media Production Location, a location must be land or other real property that is in a MPDZ and will:
(1) be used exclusively to build or construct one or more media production facilities;
(2) if the real property is a building or other facility, be renovated solely for the purpose of being converted into one or more media production facilities; or
(3) if the real property consists solely of one or more media production facilities, be improved or renovated for that purpose or will be expanded into one or more additional media production facilities.
The building improvements located at 305 South Main Street, Suites 100-110, will qualify for designation as a Qualified Media Production Location on the basis of the following proposed renovation and uses:
Two media-related projects (Requestors) are proposed at this location. Renovation is anticipated to begin in the third quarter of 2018, and will take approximately six months to complete.
1. Red Productions, LLC, a full service film and production company headquartered in Fort Worth will relocate and be the lead tenant occupying approximately 7,600 square feet in Suite 100 of the building. It is expected that approximately $1,110,853.00 will be expended for building renovation materials, machinery, and equipment. Those items will be exempted from sales tax on account of designation of the location as a Qualified Media Production Location. Red Productions, LLC, anticipates adding five jobs at an average annual wage of $48,000.00 over the next two years.
The space provides:
a. edit bays, office space, and conference rooms for producers, production managers and editors
b. open co-working space for media related and creative companies.
The value of the proposed exemption on City of Fort Worth $.02 sales taxes on eligible tax exempt items will be approximately $22,217.00.
2. KCPFII Bryan, LLC, a partnership between Red Productions, LLC, and Craig Kelly, a real estate developer, will create "Backlot Studios" in Suite 110, a fully functional studio space for rent for film production, photography shoots, and scoring by different media professionals. It is expected that approximately $1,184,328.00 will be expended on building renovation materials, machinery and equipment. The value of the proposed exemption on City of Fort Worth $.02 sales taxes on eligible tax exempt items will be approximately $23,686.56.
Other locations within the proposed Zone can be designated as Qualified Media Production Locations by the State and receive the same sales tax exemptions, but only if nominated by the City Council. There is a limitation of three Locations allowed at any one time in a Zone.
Other areas in Fort Worth can be designated as MPDZ in the future, to the extent approved by the City Council and permitted under the Act.
This M&C does not request approval of a contract with a business entity. |
