The phrase "in a core community" shall generally be interpreted to require that qualifying expenditures meet the following standards:

1. Tangible personal property and services must be acquired by the production company from a source within a core community (although the tangible personal property may then be used elsewhere.)
2. Qualifying services must be both procured from a source within a core community and wholly performed in a core community.
3. Being "in a core community" requires an established level of physical presence of a vendor that includes both a non-temporary "bricks and mortar storefront" and at least one full time permanent employee. "Non-temporary" and "permanent" will generally be indicated by a presence of at least one year. The one year standard would be met with a prior presence as well as a planned future presence evidenced by a documented commitment such as entering into a one year lease for office space.
4. The requisite physical presence of a qualified vendor business and the transaction at issue must have an actual connection with the core community. A physical presence in the core community unrelated to the transaction would not satisfy the criteria of "in a core community." For example, transactions with a vendor that had retail outlets in a core community devoted to providing film development and digital media film prints to a consumer market would not qualify for the higher core community credit percentage for transactions where movie quality film is sold to a film production company from a vendor location outside the core community.
5. Simple pass through transactions will not qualify as "direct production expenditures" "in a core community." Generally, the existence of an added markup by the business in the core community that is consistent with industry norms will give evidence the transaction has economic substance in the core community and is not merely a pass through transaction.