Jonathan Nolan says California tax credits kept Fallout in Hollywood
Jonathan Nolan said California’s tax credits kept Fallout in Hollywood, as the state raised incentives to fight a production drain and protect jobs.
California’s tax credits helped bring Fallout back to the state, but the bigger question is whether subsidies can slow Hollywood’s long-running production drain. At a sound stage in Santa Clarita, writer and producer Jonathan Nolan pointed to the Amazon Prime Video series as evidence that California can still compete when it is willing to spend.
Nolan said the state’s incentives brought Fallout’s second season from New York to California and kept the series in-state for a third season. California offered $25 million in rebates to lure the production west, then approved $42 million in tax credits for season 3, which had a $166.3 million budget and employed nearly 600 crew members and 30 actors, according to the California Film Commission. Nolan said the tax credit was not just useful but decisive, and that without it the project would have been a non-starter.
The production carried symbolic weight because Nolan said he had watched Hollywood work steadily migrate to lower-cost hubs such as London, Budapest and Sydney. He also invited state legislators to the Fallout set last year to show them the local job impact of keeping a major series in California. The state has since moved to broaden the program: in June 2025, the California Legislature increased the annual film and television tax credit cap from $330 million to $750 million, and Gov. Gavin Newsom said the expansion was meant to keep production, below-the-line jobs and investment rooted in California.
The numbers behind that push show why state officials are treating production policy as economic policy. The Milken Institute estimated that California lost $4.14 billion in total output from entertainment between 2019 and 2023, along with 17,234 jobs. It also found that entertainment employment fell 15% from the second quarter of 2019 to the second quarter of 2024. FilmLA data show the squeeze in physical production too: Los Angeles soundstage occupancy was 63% in 2024 and 62% in the first half of 2025, after running above 90% from 2016 through 2022.
That makes Fallout more than a high-profile television shoot. It is a test of whether California’s subsidy strategy can preserve a dense network of actors, writers, carpenters, costumers, camera operators and caterers, or whether it simply matches ever-rising incentives offered elsewhere. The state’s first two TV windows under Program 4.0 generated more than $2.5 billion in economic impact, but the deeper measure will be whether enough productions stay long enough to rebuild the jobs and local spending that once made Hollywood the default home for American screen production.
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