OKLAHOMA CITY — While the process to apply for Oklahoma’s filmmaking tax rebate has been described as “pretty intense,” state government oversight looks surprisingly relaxed when it comes time to write the multi-million dollar checks after production.
Last month, OKC Free Press sat down with Jeanette Stanton, Director of the OK Film + Music Office, to discuss the application and approval process for Oklahoma’s multi-million dollar film tax rebate program.
That rebate has helped to fund and finance everything from small indies and series to massive projects like “Twisters” and “Killers of the Flower Moon,” but the mechanisms of the program at the state government level have remained mysterious and obtuse to many, with some questioning the oversight or verification involved.
Notably, this is not a tax credit or tax break, it’s a direct payment to a film’s producers following a production, often totaling hundreds of thousands of dollars and sometimes rising into millions of dollars’ worth of state tax money.
We caught up with Stanton later to discuss the process of films submitting their final production reports and receiving their rebate payments and learned that there’s actually little direct state government verification or oversight of the jobs and expenses for Oklahoma film projects benefitting from those payouts.
Massive job for third-party accountants outside state gov
The final submissions to the Film + Music Office at the end of an approved production come as a joint filing with the producers submitting things like crew numbers, expenditures, and vendor lists with verification and audits handled by a licensed CPA hired by the company, not the state.
“So the CPA, they are required to check that everyone that’s being qualified is a local and the CPAs have reports that they require,” Stanton told Free Press by phone. “We have to have that letter from the CPA that they’ve done their verification. We are reliant on the CPA, and ultimately, they’re putting their stamp. They’re liable for making sure that everything that we require happened.”
Those accountants on whom the office is “reliant” for reporting and verifying jobs and production expenses are not part of the state government.
“They’re not state-appointed, no,” Stanton said. “They know what they’re supposed to be looking for, but no, it’s ultimately up to the production who they choose to do the review for them. They just have to be a third party.”
That means it’s up to those third-party accountants to verify as many as 1,600 crew members in the case of “Killers of the Flower Moon,” or the 1,100 reported crew jobs created over two separately approved productions required to complete the film “Reagan.”
Once the office receives the final submissions from both the producers and the accountant, the process is primarily about confirming that those reports match and then adding up numbers and determining the amount of the rebate that will be paid out.
Once those amounts are sent to the Oklahoma Tax Commission, Stanton said that checks are usually sent out within just two weeks.
“What needs to happen is the CPA report will match the production report, right?” Stanton said. “If they don’t, then, of course, we have questions.”
‘We’re not a regulatory agency’
While staff from the Film + Music Office will sometimes visit sets to help foster a filmmaking network and community in the state, Stanton said the office isn’t set up to audit or oversee a production or to determine that the reported crew numbers or expenses are accurate during production.
“We’re not auditing, no,” she said. “We’re not a regulatory agency. We’re not the police. We’re all in this together, so we want to make sure that the vendors are happy and the crew is as happy as they can possibly be.”
“We’re not auditing, no.”
— Jeanette Stanton, Director of the OK Film + Music Office
Those crews are the key to the tax rebate, which Stanton has described as “a workforce program” designed more to spur jobs and hiring in Oklahoma than to produce viable or successful films.
Rebate payment amounts are determined largely according to the number of local Oklahoman crew members hired, the length of the jobs created, and the amount spent on crew fees and production costs in Oklahoma cities.
Jobs program
According to Stanton, ensuring that those sometimes massive rebate payments are funding Oklahoman jobs is the most important duty of the Film + Music Office, and the belief is that those determinations can be made clearly enough at the application stage that less oversight is needed after production wraps.
“We’re very supportive of the productions using this incentive,” Stanton said. “So we can guide and we can recommend, but again, we’re not a regulatory agency.”
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Brett Fieldcamp has been covering arts, entertainment, news, housing, and culture in Oklahoma for nearly 15 years, writing for several local and state publications. He’s also a musician and songwriter and holds a certification as Specialist of Spirits from The Society of Wine Educators.