The SB 22 Renaissance: Permanent Funding & Stability

The legislative landscape for Texas Film Tax Credits—technically structured as the Texas Moving Image Industry Incentive Program (TMIIIP)—underwent a paradigm shift in late 2024 and early 2025. According to analysis from Variety and Deadline, the primary friction for Texas was never its locations or crew base, but its biennial appropriation risk. Producers could not plan for a multi-season series if the incentive fund might be empty in eighteen months.

Senate Bill 22 solved this by creating a dedicated fund outside the general treasury, ensuring a $300 million biennial floor. This effectively removes the “incentive anxiety” for major streamers. Furthermore, the program is now codified through August 31, 2035. For a C-suite executive, this means Texas now offers the same long-term fiscal predictability as the UK’s Audio-Visual Expenditure Credit (AVEC) or Georgia’s uncapped credits. However, the catch remains: Texas grants are competitive and discretionary. The office evaluates projects based on their “financial viability” and their potential to catalyze permanent studio infrastructure.

Qualified Spend Tiers: The Path to the 25% Base

In 2025, the incentive is strictly tiered to favor high-impact productions. The minimum qualified spend to enter the program for Film and Television is $250,000, while Commercials and Video Games can enter at $100,000. However, the rebate percentage scales aggressively with the budget:

• 5% Rebate: $250,000 – $999,999 in-state spend.
• 10% Rebate: $1,000,000 – $1,499,999 in-state spend.
• 25% Rebate: $1,500,000+ in-state spend.

The jump from 10% to 25% at the $1.5M mark is the most significant “cliff” in US production incentives. For a production spending $1.4M, the rebate is $140,000. By adding just $100,000 in qualified spend, the rebate jumps to $375,000. This makes “budget padding” through local post-production or extended location stays a vital ROI strategy. To identify vendors that can help reach these spend targets, you can Find Texas-qualified post-production and VFX vendors ➝.

The Residency Mandate: Managing the 35% Threshold

Texas is a “Texans First” jurisdiction. Unlike New York, which allows for non-resident labor credits in certain tiers, Texas only provides rebates on wages paid to verified Texas residents. To qualify, a crew member must have a valid Texas ID issued at least 120 days before principal photography begins.

The 2025 mandate requires 35% of the total paid crew and 35% of the total paid cast (including extras) to be residents. Failure to hit this 35/35 mark can disqualify the entire project from the grant. This is why the “DTR” (Declaration of Texas Residency) form is the most important document in your production office.

The Future Risk: SB 22 includes a mandatory “step-up” provision. The 35% threshold remains until September 1, 2027, after which it rises to 40%, eventually hitting 50% by 2031. For long-running episodic series, building a “pipeline” of local talent is no longer optional—it is a fiscal requirement. You can use Show me major film studios and crew heads based in Texas ➝ to begin this long-term recruitment.

Stackable Bonuses: Unlocking the 31% Ceiling

While the 25% base is attractive, the elite “Insider” strategy involves “stacking” additional grant awards. In 2025, these bonuses allow a production to reach a cumulative 31% rebate—putting Texas on par with the best international programs.

1. Rural Filming Bonus (2.5%): Triggered if 35% of filming days occur in a county with a population under 300,000. This is designed to drive economic impact outside the “Big Four” hubs (Austin, Dallas, Houston, San Antonio).

2. Veteran Hiring Bonus (2.5%): If 5% of your combined cast and crew are honorably discharged Texas veterans, you unlock this uplift. Given the high concentration of military personnel in San Antonio and El Paso, this is often the most accessible bonus for producers.

3. Post-Production Bonus (1.0%): If 25% of your total in-state spend is allocated to post-production (editing, sound, VFX, music), you earn an additional point. This is stackable even if the principal photography took place elsewhere, provided the spend meets the TMIIIP thresholds.

4. Special Categories: New for 2025 are the “Texas Heritage” and “Faith-Based” designations, which can also provide a 2.5% uplift if the content aligns with specific state cultural objectives.

Audit Guardrails: Cash Flowing a Grant vs. a Credit

The final friction for producers is timing. Because TMIIIP is a cash grant paid by the State of Texas after a final audit, there is a “liquidity gap.” Payouts typically occur 4 to 9 months after the final wrap. Unlike Georgia, where you can sell a credit to a third party for “bridge cash” mid-production, Texas grants must be “cash flowed” through an entertainment bank.

Banks like City National Bank or Comerica will lend against the grant, but only if the producer can demonstrate a “clean” audit trail. Texas is notorious for its strict audit requirements: single-vendor submissions are rejected, and every receipt must match the GL (General Ledger) with pinpoint accuracy. The “Decency Clause” is also a factor—the Music, Film, Television, and Multimedia Office has the authority to deny grants for content that portrays Texas or Texans in a “negative fashion.” Producers must ensure their content review is completed early to avoid a mid-audit denial. For financing partners, you can Find banks that cash flow Texas film rebates ➝.