California Officials Want Films to Be More Diverse. Their Plan Would Help a Studio Developer in Banning
A bill in the California Legislature to promote diversity in TV and film would also help a housing developer who wants to build a $200 million film studio in Banning.
The bill would add Banning — a small city 90 miles east of Los Angeles — to the so-called “30-mile zone,” which is the area where producers pay lower mileage rates and per diems. If adopted in the collective bargaining process, that change would provide studios and production companies with a financial incentive to use the proposed facility.
The bill would also create a new $200 million annual tax credit for “minority films” — independent productions that are minority-owned and employ a majority non-white cast and crew.
The developer behind the studio project, Ruben Islas, told Variety in an interview this week that his aim is to produce films with uplifting and inclusive messages. He said he wanted to see more positive depictions of Latinos, which would reflect his own experience growing up in a low-income neighborhood in San Diego.
“I understand there is a void for representation for minorities,” Islas said. “I hope I can create a place that can foster new talent and new films.”
The proposal has the backing of the state treasurer, Fiona Ma, who is a longtime supporter of the state’s film tax credit program. Ma is the sponsor of the bill — AB 986 — and helped Islas identify the city’s airport as a development site.
Ma and Islas toured the site about four months ago, and the talks have progressed from there, said James Wurtz, the city’s economic development manager.
Islas also recently contributed $15,600 to Ma’s re-election campaign, according to state campaign finance records.
In an interview, Ma talked up Islas’ “dream project” — dubbed Grandave Studios — as a way to keep diverse productions in the state.
“This is modeled after the Tyler Perry studio,” she said. “We’re trying to level the playing field with this.”
Islas presented his plans at a Banning City Council meeting last month. Ma called into the meeting to offer her support for the project.
The city has been trying for years to close the run-down airport, which is a drain on the city’s coffers and only has a handful of takeoffs a day. The primary tenant is a skydiving operation, and the facility is also used for drag-racing.
Islas walked the council through his plan to build a series of domes and sound stages, and possibly a water tank. He said the facility could be made sound-proof, so filming would not be interrupted by airport operations or the nearby freight tracks. He also told the council the facility could bring 8,000 jobs to the city.
“I’ve got the money. I’m gonna do it,” he said at the meeting. “So let’s get things approved.”
Banning sits alongside the 10 freeway, and most travelers pass right by it on the way to the Morongo Casino, the nearby outlet malls, or Palm Springs. The city is economically depressed and could use a boost.
“I have seen the highs and I’ve seen the lows,” Mayor Colleen Wallace told Variety. “It’s low now. This will help us. This will put us on the map.”
Ma alluded in the council meeting to providing tax credits to help make the project a reality.
“I am committed to helping — whatever I can, with traffic mitigations, tax credits, and any other support you need,” she said. “We are losing so many jobs and tax revenues to other states that clearly should be and could be coming back to California.”
Islas told Variety that he is not depending on the passage of the bill in order to finance the project.
“I’m not just making a pipe dream,” he said. “I know how to do real estate. I know how to do numbers. I’m a finance guy. The legislation — AB 986 — is very exciting. We do need equitability. If it goes through and the governor signs it, that’s wonderful.”
But he added, “I can’t be in a position to hold onto that. My project has to stand on its own.”
He said he had started to put out “feelers” to Hollywood to gauge whether there would be interest in shooting in Banning, but had not had any concrete discussions.
As drafted, the legislation would add Banning to the “studio zone,” which historically has been a 30-mile circle centered on the intersection of La Cienega and Beverly boulevards. Over the years, producers have added a handful of slightly more distant locations to the zone, including the Pomona Fairplex and the Ontario International Airport.
But to gain any benefit from inclusion in the zone, the change would have to be adopted by producers and entertainment unions in their contracts. The only effect of adding it solely to state law would be to eliminate a 5% bonus in the tax credit program that goes to projects that film outside the studio zone.
The current California tax credit program provides $330 million a year to films and TV shows, subsidizing up to 25% of the costs of production. The bill would increase that amount to 40% for “minority films,” and add an additional $200 million for such projects on top of the existing program.
Former Assemblyman Mike Gatto, who authored the bill that created the current version of the program, expressed skepticism about the proposal.
“It’s a tough time from a financial standpoint,” he said. “It’s probably not the best optics to give away hundreds of millions of dollars.”
He also argued that mandating diversity through the tax credit system would run into legal obstacles.
“I believe that Hollywood does need some changes,” Gatto said. “I don’t think, legally, they can come from the government.”
But Assemblyman Mike Gipson, who introduced the bill last month, said it presents a win-win for the state and for the entertainment industry.
“I think it levels the playing field in a very simple fashion,” Gipson said. “It will allow young men and young women of color to get behind the scenes, and become lighting engineers and technicians, and get behind the camera.”
Gipson also expressed enthusiasm about Grandave Studios.
“I have met Ruben. I believe he can muster the capital to do it,” Gipson said. “It just makes sense for California to be a partner.”
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