Texas Film Incentive TMIIIP: The Complete Producer’s Guide to the $1.5 Billion Cash Grant Program Reshaping Production in the Lone Star State
For years, Texas had the locations, the crew base, and the cultural identity to compete with Georgia, Louisiana, and New Mexico for major productions. What it lacked was the financial firepower. That changed dramatically in 2025 when the Texas Legislature passed Senate Bill 22, committing $1.5 billion over ten years to the Texas Moving Image Industry Incentive Program. For producers evaluating where to base their next project, and for local professionals, from studio operators to freelancers offering Austin videographer services, the Texas film incentive TMIIIP now represents one of the most significant production funding mechanisms in the country.
How TMIIIP Works: Cash Grants, Not Tax Credits
The first thing producers need to understand about TMIIIP guide is structural: it is a cash grant program, not a tax credit. After a production wraps and its documentation has been audited and approved, the state issues a direct cash payment. This is a critical distinction from programs in Georgia, New York, or California that issue transferable or refundable tax credits, which often require secondary market transactions to convert to cash. TMIIIP’s direct payment model eliminates that friction. The program covers film, television, commercial, animation, visual effects, video game, and extended reality productions. To qualify, productions must spend a minimum dollar amount in-state, employ a quota of in-state staff, and complete at least 60% of the project in Texas.
Grant Rates and Tiers Under SB 22
Effective September 1, 2025, TMIIIP operates on a tiered grant structure based on qualified in-state spending. Film and television productions receive grant rates that scale with budget size, starting at 5% for projects with qualified spend between $250,000 and $999,999. Documentary films qualify under the same category, though reality television has its own tiered breakdown. Digital interactive media projects, including animation, visual effects, video games, augmented reality, and virtual reality, receive grants on a parallel tiered structure. This breadth is notable: Texas production incentives overview explicitly includes the gaming and XR industries alongside traditional film and television.
Stackable Bonuses: Getting to 31%
Where TMIIIP becomes particularly competitive is in its stackable bonus structure. The program caps total incentives at 31% of qualified in-state spend, but reaching that ceiling requires combining the base grant with targeted bonuses. A 1% bonus applies to productions that allocate at least 25% of total eligible in-state spend toward qualifying post-production work within Texas. Additional bonuses are available for productions that hire military veterans, film in underutilized or economically distressed areas, or meet other criteria designed to distribute production activity beyond the major metros. These bonuses are cumulative, meaning a strategically planned production can layer incentives significantly above the base rate. Producers evaluating how Texas stacks up against competing regions often reference comparisons like Texas vs other states.
The $1.5 Billion Commitment: SB 22 and Long-Term Stability
Before SB 22, TMIIIP’s funding fluctuated wildly between legislative sessions. The program was created in 2007 and first funded in 2009, but its budget ranged from $22.5 million in 2022–2023 to $200 million in 2024–2025. SB 22 analysis changed this calculus fundamentally, creating a statutorily directed biennial transfer to a dedicated fund, ensuring consistent funding of approximately $300 million every two years through a sunset date of August 31, 2035. The advocacy campaign featured vocal support from Matthew McConaughey, Woody Harrelson, and Yellowstone creator Taylor Sheridan, who all testified before the Texas Senate Finance Committee.
Sales Tax Exemptions and Local Supplements
TMIIIP guide operates alongside Texas’s existing sales tax exemptions for production. At the local level, Austin supplements state incentives through its Austin Creative Content Incentive Program. San Antonio offers its own Supplemental Film Incentive Program with cash rebates of up to 14% on local spending, which can stack with TMIIIP for a combined potential rebate of up to 45%, one of the most competitive combined rates in the country. The Media Production Development Zone Act grants sales and use tax exemptions covering construction or renovation costs for permanent production facilities, further incentivizing studio investment.
Content Review and Considerations
Producers should be aware that SB 22 includes provisions requiring the Texas Film Commission to review proposed content as part of the preliminary application process. The legislation states that grants should not fund content that portrays Texas or Texans in a negative fashion and that projects should conform to general standards of decency. While the practical implementation remains to be fully established through rulemaking, productions should factor content review into their planning timelines. Despite this consideration, the financial case for Texas production under TMIIIP is compelling: $1.5 billion in committed funding, cash grant payments, stackable bonuses up to 31%, no state income tax, and rapidly expanding studio infrastructure make Texas a serious competitor to every major production market in the United States.
