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Kevin Costner’s ‘Yellowstone’ may leave Utah due to budget shortage in tax incentives for films

(Photo courtesy Paramount Network) Kevin Costner as John Dutton in “Yellowstone.”

The third season of the Kevin Costner TV series “Yellowstone” starts running Sunday on the Paramount Network. It may be the last produced largely in Utah.

The show’s producers have informed the owners of Utah Film Studios in Park City that they won’t be returning for Season 4 because, they believe, Utah’s limited tax incentive program will not provide them with the same rebates they received in Seasons 1-3. And producers confirmed reports that the show is planning to move production entirely to Montana.

The series about a family of wealthy ranchers battling to hold on to their land is set in that state, but 70-75% of production has been in Utah.

“We’ve been hearing that they were canceling all their vendors here in Utah and pulling up stakes and moving completely to Montana,” said Marshal Moore, vice president of operations at Utah Film Studios. “It turned out to be true, but they don’t want to leave.

“They feel like they’re forced to because of Montana’s shiny new $10 million incentive that they just passed last year. That and the fact that our film commission and the Governor’s Office of Economic Development can’t offer them really anything at the moment.”

(Photo courtesy Paramount Network) Luke Grimes as Kayce Dutton and Kevin Costner as John Dutton in “Yellowstone.”

“Yellowstone,” which has spent approximately $80 million in Utah to date, received tax rebates in excess of $7 million for each of its first three seasons — payments that were each scheduled to be paid out over three years. Utah Film Commission director Virginia Pearce said “Yellowstone” producers have applied for tax incentives for Season 4, and that she’s meeting with them on Friday.

“We haven’t made a determination about the amount of incentives we can offer ‘Yellowstone’ for Season 4,” she said. “We’re reviewing their application, along with other applications received this month to present to the GOED board for review on July 9.”

However, “available funding” for fiscal 2021 is “limited” and multiple productions are vying for the $8.29 million the state has allocated.

Productions that spend more than $1 million on goods and services in Utah, along with the salaries of Utahns on the crew, are eligible for rebates of up to 25%. Moore estimated that half of the approximately 250 crew members on “Yellowstone” are Utahns.) Productions that spend less than $1 million can receive rebates up to 20%.) But the total amount available — $8.29 million – hasn’t changed in several years.

“We have already received a lot of interest in the fund,” Pearce said, “and we will most likely not be able to approve incentive requests at the full 20-25%.”

Montana’s tax incentive offers rebates at a base rate of 20% of production costs — and that can range up to 35% through a variety of add-ons. Its $10 million annual cap exceeds Utah’s by 17%.

The Paramount Network has not replied to repeated requests for comment.

(Photo courtesy BYUtv) Joel McCrary stars as Baldric, Sloan Morgan Siegal stars as Dwight, and Caitlin Carmichael stars as Gretta in BYUtv's "Dwight in Shining Armor."

If “Yellowstone” leaves Utah, it will follow in the footsteps of “Dwight In Shining Armor.” That BYUtv series left the state last year after its first season because of the tight tax incentive situation in Utah.

“Dwight” moved Season 2 production to Georgia, which provides up to a 30% rebate that applies to the salaries of both Georgians and non-Georgians — and there’s no cap on the total payments, which reached an estimated $870 million in 2019. The film and television industry spent an estimated $2.9 billion in Georgia last year.

“Yellowstone” producers told Utah Film Studios that their crews would return to remove stages, equipment and supplies, but have not yet done so because of the ongoing coronavirus pandemic. “COVID is holding everything up, or it would have happened already,” Moore said.

“Yellowstone” producers had hoped to return to production in July, but that appears unlikely no matter where the show is filmed. Not only are unions, including SAG-AFTRA, IATSE and the Teamsters, still negotiating with studios and producers about getting back to work, but there are reports the studios won’t be able to get their productions insured until at least 2021 — or that insurance rates will be prohibitive.

(Photo courtesy Craig Sjodin/Disney+) “High School Musical: The Musical: The Series” stars Mark St. Cyr as Mr. Mazarra, Dara Reneé as Kourtney, Larry Saperstein as Big Red, Joshua Bassett as Ricky, Frankie A. Rodriguez as Carlos, Olivia Rodrigo as Nini, Julia Lester as Ashlyn, Matt Cornett as E.J., Kate Reindeers as Miss Jenn and Sofia Wylie as Gina.

Reportedly, Disney is tentatively planning to resume production on Season 2 of “High School Musical: The Musical: The Series” in September, but that, too, remains up in the air.

Moore said the owners of the Utah Film Studios, which was the base of operations for “Yellowstone” for the past three seasons, are holding out hope that something can be worked out to keep the show there. The producers “don’t know what they’re doing yet 100%,” he said.

“I really think they’re trying to throw a Hail Mary and try to make something work in Utah so they don’t have to pull up stakes completely,” he said. “But they basically have one foot and four toes out the door.”