As used in this subchapter:
(1) “Above-the-line production crew” means employees involved with the production of a motion picture or entertainment production whose salaries are negotiated prior to commencement of production, such as actors, directors, producers, and writers;
(2) “Animated production” means a nationally distributed feature-length film created with the rapid display of a sequence of images using 2-D or 3-D graphics of artwork or model positions in order to create an illusion of movement;
(3) “Approved company” means an eligible company approved for incentives provided under KRS § 141.383 and KRS § 154.61-020;
(4) “Authority” means the Kentucky Economic Development Finance Authority created in KRS § 154.20-010;
(5) “Below-the-line production crew” means employees involved with the production of a motion picture or entertainment production except above-the-line production crew. “Below-the-line production crew” includes but is not limited to:
(a) Casting assistants; (b) Costume design; (c) Extras;
(d) Gaffers; (e) Grips;
(f) Location managers; (g) Production assistants;
(h) Set construction staff; and
(i) Set design staff;
(6) “Cabinet” means the Cabinet for Economic Development; (7) “Commonwealth” means the Commonwealth of Kentucky;
(8) “Compensation” means compensation included in adjusted gross income as defined in KRS § 141.010;
(9) “Continuous film production” means a motion picture or entertainment production that:
(a) 1. Has a projected budget of a minimum of ten million dollars ($10,000,000) per calendar year for qualifying expenditures and qualifying payroll expenditures allocated to all qualifying motion picture or entertainment productions to be filmed or produced in Kentucky, with a minimum of one million five hundred thousand dollars ($1,500,000) per production in Kentucky; and
2. Has a minimum of fifty percent (50%) of the funds available and the ability to raise the remaining funds necessary to complete the filming and production, which may be verified by:
a. Bank statements or other financial documents; or b. A fundraising plan at the request of the authority;
(b) Demonstrates a distribution contract for each motion or entertainment production;
(c) Films and produces a minimum of twelve (12) or more days per production within the Commonwealth; and
(d) Maintains:
1. An apprenticeship program or on-the-job training program as defined in
KRS § 343.010; or
2. Partners with a film studies program with an accredited institution of postsecondary education located in the Commonwealth;
(10) “Documentary” means a production based upon factual information and not subjective interjections;
(11) “Eligible company” means any person that intends to film or produce a motion picture or entertainment production in the Commonwealth;
(12) “Employee” has the same meaning as in KRS § 141.010, and, for purposes of this subchapter, also may include the employees or independent contractors of an approved company or the employees of a loan-out entity engaged by an approved company if they meet the requirements of KRS § 141.310;
(13) “Enhanced incentive county” has the same meaning as in KRS § 154.32-010; (14) “Feature-length film” means a live-action or animated production that is:
(a) More than thirty (30) minutes in length; and
(b) Produced for distribution in theaters or via digital format, including but not limited to DVD, Internet, or mobile electronic devices;
(15) “Industrial film” means a business-to-business film that may be viewed by the public, including but not limited to videos used for training or for viewing at a trade show;
(16) “Kentucky-based company” has the same meaning as in KRS § 164.6011;
(17) “Loan-out entity” means a corporation, partnership, limited liability company, or other entity through which an artist or other person is loaned out to perform services for the approved company. A loan-out entity shall be registered and in good standing with the Kentucky Secretary of State. Notwithstanding the business organization, the loan-out entity and all employees of and other persons performing services for the loan-out entity shall be subject to all applicable provisions of the Kentucky personal income tax and any applicable payroll or other tax provisions;
(18) (a) “Motion picture or entertainment production” means:
1. The following if filmed in whole or in part, or produced in whole or in part, in the Commonwealth:
a. A feature-length film; b. A television program; c. An industrial film; or d. A documentary; or
2. A national touring production of a Broadway show produced in
Kentucky.
(b) “Motion picture or entertainment production” does not include the filming or production of obscene material or television coverage of news or athletic events;
(19) “Obscene” has the same meaning as in KRS § 531.010; (20) “Person” has the same meaning as in KRS § 141.010;
(21) (a) “Qualifying expenditure” means expenditures made in the Commonwealth for the following if directly used in or for a motion picture or entertainment production:
1. The production script and synopsis;
2. Set construction and operations, wardrobe, accessories, and related services;
3. Lease or rental of real property in Kentucky as a set location;
4. Photography, sound synchronization, lighting, and related services;
5. Editing and related services;
6. Rental of facilities and equipment;
7. Vehicle leases;
8. Food; and
9. Accommodations.
(b) “Qualifying expenditure” does not include Kentucky sales and use tax paid by the approved company on the qualifying expenditure;
(22) “Qualifying payroll expenditure” means compensation paid to above-the-line crew and below-the line crew while working on a motion picture or entertainment production in the Commonwealth if the compensation is for services performed in the Commonwealth;
(23) “Resident” has the same meaning as in KRS § 141.010;
(24) “Secretary” means the secretary of the Cabinet for Economic Development;
(25) “Tax incentive agreement” means the agreement entered into pursuant to KRS
154.61-030 between the authority and the approved company; and
(26) “Television program” means any live-action or animated production or documentary, including but not limited to:
(a) An episodic series; (b) A miniseries;
(c) A television movie; or
(d) A television pilot;
that is produced for distribution on television via broadcast, cable, or any digital format, including but not limited to cable, satellite, Internet, or mobile electronic devices.
Effective: June 29, 2023
History: Amended 2023 Ky. Acts ch. 75, sec. 30, effective June 29, 2023. — Created
2021 Ky. Acts ch. 156, sec. 17, effective June 29, 2021.