‘Nashville’ Renewed for Third Season at ABC

It’s official: ABC’s Nashville is returning for a third season!

The country-music drama starring Connie Britton and Hayden Panettiere has been the center of prolonged negotiations between Lionsgate TV, which co-produces the series with ABC Studios, and ABC. The series will receive a full season order of 22 episodes.

Nashville was suspiciously missing among the slate of shows ABC announced it was renewing for the 2014-2015 season. As the news slowed, and renewals and cancellations began trickling out one by one, panic began to set in among fans. Even star Claire Bowen (who plays Scarlett) began retweeting positive messages from fans, urging ABC to renew the series.

Then, around 12:30 last night, news of the series’ renewal was officially announced. “Congratz and welcome back for Season 3 to @Nashville_ABC @conniebritton @CharlesEsten @CallieKhouri, the whole Nashville team and loyal fans,” tweeted Ben Sherwood, Co-President, Disney ABC Television Group.

According to reports from Deadline, tax credits and the episode order is what led to protracted negotiations over Nashville’s renewal. Lionsgate TV allegedly wanted a bigger episode order than ABC’s initial 13-episode offer. Reduced tax credits from Tennessee, where Nashville is filmed, was also slashed to $4 million versus the $12.5 million received for the 2013-2014 season, gave producers a huge hole to fill in the budget.

Tax credits have become a big sticking point for many projects filmed on location in recent years. As state governments look to plug budget deficits and shortfalls, reducing or eliminating tax credits entirely has been one of the many solutions enacted. Supporters of entertainment tax credits say the incentive creates jobs and benefits local economies (as cast and crew will frequent hotels, diners, supermarkets, etc).

NBC’s Law & Order: Special Victims Unit was a beneficiary of New Jersey’s tax incentive program, created in 2005 to boost film and TV production in the Garden State. The program awarded a 20 percent tax credit, but the program was suspended in 2010 by Governor Chris Christie, with plans to end in 2015. As a result of that decision, the Law & Order franchise packed up and moved the bulk of their filming to Chelsea Piers in Manhattan. HBO’s award-winning Boardwalk Empire, set in Atlantic City, New Jersey, actually filmed in New York due to New York’s improved tax breaks at a 35 percent rate.

In a few weeks, North Carolina lawmakers will take up legislation to amend their list of entertainment productions eligible for tax breaks. While scripted TV dramas and pilots, commercials, big-budget films and sports programs will remain unaffected, the proposal will eliminate breaks for sports entertainment (WWE), reality TV and late-night series.

Nashville brings an estimated $40 million in business to the state. Ahead of the series launch in 2012, the Tennessee Department of Economic and Community Development highlighted the production was expected to employ more than 350 Tennessee residents in various crew positions. So, in addition Nashville creating jobs, it’s also essentially an hour-long commercial for Nashville, TN. Why reduce tax incentives for a production that’s benefiting their state?

Lionsgate and ABC want to continue filming Nashville in Tennessee, but that’s contingent on the state legislature revisiting the proposed tax incentives.