Chapter 02. Film Production Activity—Employer Wage Rebate Grant Program
Regulation .01 Purpose.LinkCopy Citation
This chapter describes the policies, procedures, and authorizations for providing grant rebates in connection with a film production activity from the Film Production Activity—Employer Wage Rebate Grant Program.
Regulation .02 Definitions.LinkCopy Citation
A.
In this chapter, the following terms have the meanings indicated.
B.
Terms Defined.
(1)
“Act” means Economic Development Article, Title 4, Subtitle 4, Annotated Code of Maryland.
(2)
“Applicant” means an individual, partnership, corporation, limited liability company, not-for-profit entity, or other form of entity permitted to do business in the State seeking a grant from the Department.
(3)
“Department” means the Department of Commerce.
(4)
Film Production Activity.
(a)
“Film production activity” means the production, including preproduction, of a film or video project:
(i)
For which the total direct costs incurred in the State are at least $500,000;
(ii)
For which more than half of the principal photography will be done in the State; and
(iii)
Which upon completion, will be distributed nationwide.
(b)
“Film production activity” does not include:
(i)
Student films;
(ii)
Noncommercial personal videos or films;
(iii)
Sports broadcasts;
(iv)
Broadcasts or filming of live events;
(v)
Talk shows;
(vi)
Reality television programs or films; or
(vii)
Any activity which is not necessary to and undertaken directly and exclusively for the making of a master film, tape, or image.
(5)
“Fund” means the Film Production Employer Wage Rebate Fund, which is administered by the Department.
(6)
“Grant” means a grant made by the Department from the Fund under the provisions of the Act and this chapter.
(7)
Qualified Employee Wages.
(a)
“Qualified employee wages” means the first $25,000 of an employee's wages that are:
(i)
Directly attributable to the employee's work in the film production activity in the State; and
(ii)
Paid directly by the qualified film production employer to the employee.
(b)
“Qualified employee wages” does not include:
(i)
Any portion of the wages of an employee whose wages in connection with the film production activity equal or exceed $1,000,000;
(ii)
The value of fringe benefits (whether paid by the employer or the employee), required payments by the employer such as social security contributions and payroll taxes, or deferred compensation; or
(iii)
Any wages paid to, or earned by, an employee prior to the date the qualified film production employer opens a film production office in the State.
(8)
“Qualified film production employer” means an employer:
(a)
That is carrying out a film production activity; and
(b)
That the Secretary has agreed to extend a grant from the Fund.
(9)
Total Direct Costs of a Film Production Activity.
(a)
“Total direct costs of a film production activity” means the total of costs incurred that are necessary to carry out a film production activity.
(b)
“Total direct costs of a film production activity” includes costs incurred for:
(i)
Employee wages and benefits;
(ii)
Fees for services;
(iii)
Acquiring or leasing real property or tangible or intangible personal property; or
(iv)
Any other expense necessary to carry out a film production activity.
Regulation .03 Film Production Activities Financed by the Fund.LinkCopy Citation
The Fund shall be used to provide grants to reimburse a qualified film production employer for a portion of the qualified employee wages incurred by the qualified film production employer in connection with a film production activity.
Regulation .04 Eligible Applicants.LinkCopy Citation
A.
An applicant may apply for a grant under the Act as set forth in this regulation.
B.
The applicant shall:
(1)
Apply to the Department for a grant from the Fund before photography on the film production activity occurs;
(2)
If applicable, be in good standing in the jurisdiction in which it is organized and in the State;
(3)
Be the expected qualified film production employer; and
(4)
Expect to begin filming of the qualified film production activity within a reasonable period of time, not to exceed 120 days after the date of submission of the application.
Regulation .05 Application and Processing Procedures.LinkCopy Citation
A.
Grant Application.
(1)
Grant applications shall be made on standard forms prescribed by the Department.
(2)
Each application shall include:
(a)
The information required by Economic Development Article, §4-403(c), Annotated Code of Maryland; and
(b)
Any other information the Secretary requires related to the film production activity and the employer seeking the rebate.
B.
Processing Procedures.
(1)
Application Review. The Department shall review each application to determine whether an applicant will be awarded a grant from the Fund and the amount of that grant. In making the determination whether to award a grant or the amount of a grant to be awarded, the Secretary may consider any of the following factors:
(a)
Whether the applicant is a qualified film production employer and the proposed project is a film production activity;
(b)
The economic impact of the film production activity on the State;
(c)
The financial resources of the qualified film production employer;
(d)
The amount of wages to be paid to employees of the qualified film production employer; and
(e)
The expected value to the State resulting from the film production activity.
(2)
Grant Agreement.
(a)
The Department shall prepare and provide the applicant with a copy of a grant agreement which shall contain the provisions the Department determines are necessary to reflect the terms of the grant.
(b)
In addition to any other requirements of the Department, the grant agreement shall require that any version of the film production activity which is distributed for viewing by the public shall contain a screen acknowledgement in form and content acceptable to the Department.
Regulation .06 Completion of Principal Photography.LinkCopy Citation
Upon completion of principal photography in the State, or in the case of a film production activity which is serial in nature, upon completion of principal photography for the season, the qualified film production employer shall deliver any information or certifications concerning the film production activity required by the Department.
Regulation .07 Disbursement of Grant Funds.LinkCopy Citation
The Department shall only disburse grant funds to a qualified film production employer after the Department has reviewed and accepted all materials submitted to the Department under Regulation .06 of this chapter.
Regulation .08 Limitations on Grants.LinkCopy Citation
A.
Maximum per Film Production Activity. A grant from the Fund for a film production activity may not exceed the lesser of:
(1)
50 percent of the qualified employee wages incurred by the qualified film production employer in connection with a film production activity; or
(2)
$2,000,000.
B.
Limit on Seasonal Productions. Film production activities which reoccur on a seasonal basis, such as a television series, shall only be eligible for up to two grants from the Fund. Each grant shall be for a separate and distinct season.
Regulation .09 Drug-Free and Alcohol-Free Workplace.LinkCopy Citation
The applicant shall:
A.
Comply with the State's policy concerning drug-free and alcohol-free workplaces, as set forth in COMAR 01.01.1989.18; and
B.
Make a good-faith effort to eliminate illegal drug use and alcohol and drug abuse from places at which work is performed in accordance with the terms of the Department's financial assistance.
Regulation .10 Waiver.LinkCopy Citation
The Secretary or the Secretary's designee may waive or vary particular provisions of this chapter to the extent that the waiver is not inconsistent with the Act if:
A.
Conformance to the requirement of any federal, State, or local program in connection with financial assistance necessitates waiver or variance of a regulation; or
B.
In the determination of the Secretary, the application of a regulation in a specific case or in an emergency situation would be inequitable or contrary to the purposes of the Act.
Chapter annotations
Authority: Economic Development Article, §4-406, Annotated Code of Maryland
History: Effective date: February 27, 2006 (33:4 Md. R. 354)