SECTION 725:35-1-3. Program requirements and qualification

(a)   Applying for Rebate Eligibility:

(1)   Applications and all necessary forms will be submitted through the OFMO website (okfilmmusic.org) or as otherwise specified by OFMO.

(2)   Unless otherwise agreed to by OFMO, Eligibility Applications will be submitted at least 60 calendar days prior to the Start of Principal Photography. The exact requirements of the Eligibility Application are shown on the OFMO website, but generally include:

(A)   General information about the Production;

(B)   Contact information;

(C)   Preliminary Production milestone dates;

(D)   A copy of the screenplay;

(E)   The Production Budget top sheet and estimated headcount;

(F)   Various acknowledgements of Program and OFMO requirements and agreements to abide by them.

(3)   Applicants may track the status of their Eligibility Application on the OFMO website.

(4)   Application does not guarantee acceptance. OFMO considers each Eligibility Application individually based upon many factors, including compliance with these Rules, the benefits of the project to Oklahoma (such as jobs, tourism, branding, image and follow-on work), funds available, anticipated future Program needs and other projects applying for a Rebate.

(5)   If the Eligibility Application is approved, the Production Company will be Pre-Qualified and OFMO will work with the Production to establish a Rebate Schedule.

(6)   At the time of Pre-Qualification, Productions are assigned to a Fiscal Earmark Year based upon the start of Principal Photography.

(7)   Pre-Qualification does not guarantee ultimate approval of a Rebate Claim. The Production Company must meet the requirements of the Rebate Schedule and their Final Application must be approved in order for the Rebate Claim to be approved.

(8)   If the Eligibility Application is denied, OFMO will provide the applicant with the reason(s) it was denied.

(9)   Only one Eligibility Application per fiscal year per Production will be accepted.

(b)   Application Estimate: If the Eligibility Application is approved, the Application Estimate will be multiplied by the appropriate rebate percentage to determine the estimated amount to be paid in the Rebate Claim (the "Potential Rebate Claim").

(c)   If the Final Application and actual Rebate Claim are approved:

(1)   If the actual QOE are less than or equal to the Application Estimate, the Rebate Claim will be paid in full.

(2)   If the actual QOE are more than the Application Estimate, the Potential Rebate Claim amount will be paid within the normal payment timeframe and the remainder will be considered an additional claim and may, depending upon OFMO's discretion and budget, be paid at a later date outside the normal timeframe.

(d)   Rebate Schedule: After Pre-Qualification, OFMO and the Production Company will establish a schedule of dates based upon the following benchmarks:

(1)   60 calendar days prior to Principal Photography - submit Application Estimate and Proof of Funding for at least fifty percent (50%) of the Production Budget.

(2)   Prior to paying salaries or wages to a Production Company's employee in Oklahoma - submit a certificate of workers' compensation insurance with limits pursuant to Oklahoma law.

(3)   30 calendar days prior to Principal Photography - submit the following:

(A)   Proof of Funding for the Production Budget;

(B)   Updated shooting schedule;

(C)   Updated screenplay;

(D)   Copy of the Completion Bond (defined in (e) below), if applicable;

(E)   Additional documents as may be reasonably requested by OFMO.

(4)   10 calendar days prior to Principal Photography

(A)   Submit a certificate of general liability insurance with a minimum limit of $1,000,000 in coverage (or a binder for such with a start date no later than the estimated Start of Pre-Production);

(B)   Submit a certificate of automobile liability insurance with minimums of $250,000/500,000/250,000 coverage (or a binder for such with a start date no later than the estimated Start of Pre-Production) or certification that no employee of the Production will drive an automobile as part of the Production;

(C)   Work with OFMO to draft and distribute a press release about the Production to relevant media.

(5)   During Principal Photography - submit the following (preferably in advance, if practical):

(A)   Updates to the shooting schedule;

(B)   Updates to the screenplay.

(6)   Within 90 calendar days of completion of the Production (or payment date of last QOE, if later):

(A)   Upload through the OFMO website the list of Oklahoma Crew, Oklahoma Expatriates and Oklahoma Vendors used on the Production;

(B)   Submit the Final Application.

(e)   Completion Bond: Unless a Production is backed by a major studio or other financing source acceptable to OFMO, the Production will post a Completion Bond from a guarantor acceptable to OFMO guaranteeing the completion of the Production and payment of all Oklahoma liabilities. In lieu of a Completion Bond, a Production may produce evidence acceptable to OFMO that all Crew, vendors and taxes have been paid and there are no outstanding or potential liens in Oklahoma against the Production Company.

(f)   Incremental Music Rebate: To qualify for the additional rebate for Oklahoma music described in 68 O.S. § 3624(B), QOE described in Section 725:35-1-4(g)(9) must be $20,000 or more.

(g)   End of Production Requirements:

(1)   Unless otherwise approved by OFMO, the end credit crawl of all release prints of a completed short or long-form film shall include "Filmed in Oklahoma utilizing the Oklahoma Film Enhancement Rebate Program" and a logo provided by OFMO.

(2)   The Production Company shall provide to OFMO

(A)   A film poster, final release copy of the Film on DVD and digital link to a copy of the Film if available.

(B)   Production stills, behind-the-scenes footage or other images OFMO can use to promote the Program.

(h)   Certified Public Accountant's Report: Final Rebate Applications will be accompanied by a CPA's Report, prepared at the expense of the Applicant, attesting that the amounts in the application are QOE that comply with the requirements of these rules.

(1)   Reports will be prepared by a CPA currently licensed by the State of Oklahoma and who is independent under the American Institute of certified Public Accountants' (AICPA) Independence Rule.

(2)   CPAs will carry professional liability insurance, in a form and from a carrier acceptable to OFMO, for at least $500,000.

(3)   The CPA's examination will be conducted according to the AICPA's Attestation Standards.

(4)   Reports will use a materiality threshold set by OFMO and published on its website.

(5)   CPAs will work with the Production Company to resolve exceptions or discrepancies prior to submitting the Final Application, such that the CPA's Report attests to the validity and accuracy of the amounts on the Application without exception.

(6)   The CPA's Report will attest:

(A)   Actual Production expenditures were at least $50,000 and QOE at least $25,000, or if a High-Impact Production, actual expenditures were at least $50,000,000 and QOE at least $16,666,667.

(B)   All amounts on the Application are properly calculated and materially accurate.

(C)   All Oklahoma payroll tax returns due from the Production Company (or its payroll processor) have been filed.

(D)   All Oklahoma income tax returns for the Production Company due as of the review date have been filed.

(7)   The CPA will retain all workpapers for the CPA's Report for seven years, during which they may be subject to audit by the OFMO or its agents, upon a request by OFMO.

(i)   Final Application:

(1)   Upon completion of the Production and requirements herein, the Production Company will submit a Final Application.

(2)   Submitting a Final Application does not guarantee approval. OFMO will approve or disapprove of all claims within 60 calendar days of receipt of a properly completed Final Application.

(3)   If a Final Application or Rebate Claim is denied, the Production Company may attempt to correct any discrepancies or problems and resubmit within thirty (30) days of denial.

(4)   Once a Final Application is approved by OFMO,

(A)   Amendments are not allowed;

(B)   The Production Company will work with OFMO to establish a vendor ID with the State.

(5)   The Oklahoma Tax Commission will, upon notification of approval from the OFMO, issue payment for all approved Rebate Claims, subject to any Fiscal Year Maximum imposed by statute and any other agreements that the Production Company and OFMO have agreed to in writing in the case that the Production is a High-Impact Production.

(j)   Fiscal Year Maximum: The Program has a rolling cap, which adds a new amount to the fund available to pay Rebate Claims each fiscal year. In order to ensure funds are available to pay all Pre-Qualified Productions, OFMO assigns each Pre-Qualification to a Fiscal Earmark Year, which may be one or more fiscal years in the future. If the total amount available to pay claims in any one fiscal year is restricted by statute, claim approval priority will be determined using the Fiscal Earmark Year and some Productions might have to wait until the first day of a future Fiscal Earmark Year in order to receive payment. This statutory maximum would not affect the amount of the Rebate Claim or its ultimate payment, but could affect the timing of when it is paid.

(k)   Delays, Transferability and Expiration:

(1)   A Pre-Qualified Production may delay the start of Principal Photography two times as described below. If the start is delayed a third time, or a Production does not start by the date specified in their latest update to the Production Schedule submitted to OFMO, Pre-Qualification is revoked, the Eligibility Application is denied and the Production cannot apply again until the following fiscal year.

(A)   The first time a Pre-Qualified Production delays the start of Principal Photography, it moves to the end of the queue for the Fiscal Earmark Year of the new start date. Subsequent Pre-Qualifications with the same Fiscal Earmark Year are placed after it in the queue.

(B)   The second time a Pre-Qualified Production delays the start of Principal Photography, it is placed last in the queue for the Fiscal Earmark Year of the new start date. Subsequent Pre-Qualifications with the same Fiscal Earmark Year are placed ahead of it in the queue.

(2)   Pre-Qualification is specific to the Production and Production Company, and is non-transferable. Productions, screenplays and budgets may evolve but must remain substantially similar to those submitted in the Eligibility Application.

(3)   Unless otherwise approved by OFMO, Pre-Qualification expires:

(A)   Two years after the approval date of the Eligibility Application, if Principal Photography has not started, OR

(B)   Two years from the start of Principal Photography.

(l)   Open Records Act Exemptions:

(1)   OFMO is subject to the State of Oklahoma Open Records Act, which governs public access to the records of government agencies. Under 74 O.S. § 2231, certain information provided to OFMO by a person or entity seeking economic advice from OFMO and any information compiled by OFMO in response to submissions, may be kept confidential.

(2)   In order to protect confidentiality of such items, applicants must submit a written request to OFMO at the time of the Eligibility Application to withhold its information from disclosure on the grounds that it constitutes trade secrets, proprietary information or that the information, if disclosed, would cause substantial injury to the competitive position of the applicant. Applicants must specify the information for which they are seeking protection along with clearly stated reasons for the requested exception.

(3)   OFMO reserves the right to determine whether the information submitted by the applicant will be withheld from disclosure. OFMO will notify the applicant of any requests for disclosure and notify the applicant as to whether the information will be disclosed.

(m)   High Impact Production Requirements: Due to the size of potential rebates and considerable number of variables in High Impact Productions, the Executive Director is authorized to negotiate and finalize High Impact Production Requirements as part of the High Impact Production Eligibility Application process. High Impact Production Requirements can be tailored to the type and scope of the Production, and may carry additional incentives, provided these requirements and incentives do not contradict statutory provisions of the ACT. Applicants would be required to meet the High Impact Production Requirements in order for the Final Application to be approved.

[Source: Added at 19 Ok Reg 943, eff 3-15-02 (emergency); Added at 19 Ok Reg 2814, eff 7-25-02; Amended at 20 Ok Reg 1363, eff 5-27-03; Amended at 23 Ok Reg 2021, eff 6-11-06; Amended at 27 Ok Reg 2601, eff 7-25-10; Amended at 37 Ok Reg 529, eff 12-20-19 (emergency); Amended at 37 Ok Reg 2259, eff 9-11-20]