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Film Flight: Runaway Productions Hits LA and New York

Movie and TV productions are chasing tax credits, and Los Angeles and New York are suffering.

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CNBC.com

The Milken Institute has released a reportthat finds that the flight of film and TV production from California has cost the state more than 36,000 jobs since 1997.

That adds up to $2.4 billion in wages and $4.2 billion in total economic output lost in the past 13 years.

Though California implemented a tax credit last July, the Milken report raises questions about whether that incentive may be too little too late. California's tax credit is for films with budgets of $75 million or less. Seventy-five projects have been approved to receive credits and they're expected to generate more than $1 billion in spending in the state.

"The fact that they don't apply to big budget studio projections means California is missing out on the big fish." -Media Money, CNBC, Julia Boorstin

But one year later, it's clear the incentives will likely have little long term impact, and not only because they're set to expire in 2014. The fact that they don't apply to big budget studio projections means California is missing out on the big fish. The number of movies in California (either entirely or just partially) has plummeted from 272 in 2000 to 160 in 2008.

Productions are chasing tax credits in the 42 states that offer them, going to the likes of Louisiana and New Mexico. New York City used to be a hot destination for filming, thanks in part to the hefty rebates. But the absence of a budget in Albanyis hurting production dollars in New York. Right now there are no state tax credits and the city's tax incentive ran through its money last year and it hasn't been renewed.

Questions? Comments? MediaMoney@cnbc.com