SAG-AFTRA Ultra Low Budget vs. Modified Low Budget: Which Agreement Fits Your Film?

> Disclaimer: This post describes general provisions of SAG-AFTRA low budget agreements for educational purposes only. It does not constitute legal advice. Rates and thresholds are subject to renegotiation. Verify current terms directly with SAG-AFTRA at sagaftra.org/production-center or through a qualified entertainment attorney before executing any agreement.

The Agreement Choice That Locked the Casting

A producer registers her $220,000 narrative feature under the SAG-AFTRA Ultra Low Budget agreement, attaches two principal performers, and starts prep. Three weeks before principal photography, a financier joins and increases the budget to $310,000. The production is now $60,000 above the ULB ceiling. SAG-AFTRA requires the production to re-execute under the Modified Low Budget agreement, retroactively triggering the 17.3% pension and health contribution on every performer's compensation already contracted. That unplanned P&H liability costs the production $6,800 it didn't have in the contingency.

The agreement tier decision is not just about which day rate you're comfortable paying. It sets the entire labor framework for the production, and changing it mid-stream is expensive. Understanding the structural differences between the ULB and MLB agreements before attaching talent determines what you can afford, who you can cast, and what your post-production obligations will look like.

This post compares both agreements on the dimensions that matter for a typical indie narrative feature. The comparisons below draw from SAG-AFTRA's publicly available low budget theatrical agreements. Current rate sheets are published directly at sagaftra.org/production-center.

SAG-AFTRA Low Budget Agreements at a Glance

The two agreements share the same basic labor framework but differ significantly on budget ceiling, day rate, and pension and health obligations.

Day and weekly scale rates reflect SAG-AFTRA's published theatrical low budget rate schedules. Always verify current rates at sagaftra.org/production-center before budgeting -- rates are renegotiated periodically.

The most financially significant row is P&H contributions. Under the ULB, producers pay no pension and health on top of performer fees. Under the MLB, every dollar paid to a SAG-AFTRA performer carries an additional 17.3% employer contribution to the SAG-AFTRA Pension and Health Plans.

How the P&H Difference Changes the Real Budget

Pension and health contributions compound quickly. On a production with 8 SAG-AFTRA performers each earning $4,000 in total compensation, the MLB P&H obligation is 8 x $4,000 x 0.173 = $5,536 above the cast budget line. On a production where the lead earns $20,000, that single performer generates $3,460 in P&H alone.

Under the ULB, this obligation doesn't exist. For a production at $200,000 with 6 SAG-AFTRA performers at scale across a 15-day shoot, the absence of P&H saves approximately $5,000 to $9,000 depending on individual compensation levels. At tight indie budget levels, that difference can shift the production from viable to not.

The trade-off is visibility. ULB's lower scale rates mean established SAG-AFTRA performers are working well below their standard earnings. Producers compensate through deferred compensation tied to distribution proceeds, backend participation, or favorable billing terms. All deferred compensation arrangements require separate documentation in the individual deal memo. The film contracts 101 post covers what deferred compensation agreements must include to be enforceable.

Three Production Scenarios

Scenario 1: $175,000 Debut Feature, Two SAG-AFTRA Principals

A first-time director with a $175,000 budget needs two SAG-AFTRA members to satisfy a co-producer's casting requirement. The ULB applies. The budget clears the $250,000 ceiling with margin. Two performers at full ULB day rate across 12 shooting days each cost approximately $3,120 in performer fees total. No P&H contribution applies. The production models this in the Budget Breakdown Calculator before attaching talent, confirms the above-the-line cast costs represent 18% of the total budget, and proceeds. The ULB is the right tool: the economics work and the budget buffer is intact.

Scenario 2: $480,000 Feature, Named Cast as Financing Condition

A producer closes financing at $480,000 with a recognizable SAG-AFTRA performer attached as a co-production condition from the equity investor. The budget exceeds the ULB ceiling. The MLB agreement is required. The lead performer's total compensation is $30,000 across the shoot. The P&H contribution on that figure alone is $5,190. The production budgets for this from the start, includes P&H in the above-the-line cast budget, and uses the Crew Size Estimator to keep total above-the-line costs below 38% of the overall budget.

Scenario 3: $240,000 Horror Feature with Non-Union Leads

A $240,000 genre feature has three strong non-union performers in the lead roles. The director won't convert them to SAG-AFTRA membership. The ULB agreement allows for non-union cast under Taft-Hartley provisions if the producer can document that non-union performers were the best qualified candidates for the specific roles. The producer works with a production attorney to assemble the Taft-Hartley paperwork before shoot day one. This documentation is not optional: SAG-AFTRA can audit the process, and an incomplete file creates post-production liability. The budget is $10,000 below the ULB ceiling, providing a buffer against cost overruns that would trigger an agreement reclassification.

How to Choose Between ULB and MLB: A Decision Framework

Step 1: Lock your final locked budget estimate before approaching SAG-AFTRA. The agreement tier is determined by the production's total negative cost, not by the cast budget alone. Production overruns that push the total cost above $250,000 after ULB registration require renegotiation.

Step 2: Add P&H to every MLB scenario. For every cast budget scenario above $250,000, multiply total performer compensation by 17.3% and add the result as a separate line item before making any casting commitments.

Step 3: Calculate the signatory deposit requirement. SAG-AFTRA requires a pre-production security deposit equal to approximately two weeks' scale for each SAG-AFTRA performer. This amount is refundable post-delivery but must be available before SAG-AFTRA issues production authorization. Missing this deposit delays your start date.

Step 4: If the budget falls between $220,000 and $260,000, build a contingency buffer before registering. A production registered under ULB that overruns to $260,000 faces retroactive P&H liability. If the locked budget is this close to the ceiling, registering under MLB from the start is the lower-risk choice.

Step 5: Document every casting decision before using Taft-Hartley. Under both agreements, using non-union performers requires Taft-Hartley justification. Document the audition process, confirm the specific reason the non-union performer was selected, and file the paperwork before the performer's first day on set. SAG-AFTRA provides the standard Taft-Hartley form through the production center portal.

Pro Tips and Common Mistakes

Pro Tip: Request the current rate card directly from SAG-AFTRA's Production Center before building any cast budget. The published PDF rate sheets on the SAG-AFTRA website reflect the most current negotiated scale. Third-party budget templates often carry outdated rates that produce incorrect cost projections.

Pro Tip: The ULB residual structure defers performer residuals until after the film recoups its negative cost. If the film reaches streaming platforms, the distributor must be informed of the SAG-AFTRA residual pass-through obligation before the distribution deal is signed. Failing to disclose this to a distributor upfront can result in a disputed distribution agreement that neither side can enforce cleanly.

Pro Tip: Under both ULB and MLB, the production must appoint a Casting Director or complete a Producer's Certificate of Compliance before hiring any SAG-AFTRA performer. This administrative step takes 3 to 5 business days. Build it into the pre-production timeline rather than initiating it the week of the first talent deal memo.

Common Mistake: Treating "interest" from SAG-AFTRA as authorization to begin casting. The production is not a SAG-AFTRA signatory until the agreement is executed and the signatory deposit is posted. Casting SAG-AFTRA performers before the agreement is executed creates unauthorized employment of union talent, which carries fines.

The fix: Execute the agreement and post the deposit before sending any offer letter to a SAG-AFTRA performer. The guilds and unions on micro-budget productions post covers the full signatory onboarding timeline.

Common Mistake: Calculating P&H on base scale only and ignoring overtime. SAG-AFTRA P&H contributions apply to all qualifying compensation, including overtime payments. Productions that run heavy overtime on their MLB shoots discover the true P&H cost was 15 to 25% higher than the base calculation.

The fix: Use a fully-burdened cast cost model that includes P&H on overtime estimates, not just base scale.

Frequently Asked Questions

What is the difference between the ULB agreement and the SAG-AFTRA Short Film Agreement?

The Short Film Agreement applies to films under approximately 35 minutes in runtime with budgets not exceeding $50,000. The day rate is approximately $100. The ULB applies specifically to theatrical feature films up to $250,000 total negative cost. The two agreements are not interchangeable: a 25-minute short qualifies for the Short Film Agreement; a 75-minute feature under $250,000 qualifies for ULB. Using the wrong agreement creates a compliance violation regardless of budget.

Can a film made under ULB be acquired by a major streaming platform?

Yes. ULB productions can be licensed to any distribution channel. The distribution agreement must include explicit provisions for SAG-AFTRA residual payments on streaming, broadcast, and home video revenue. Netflix, Amazon, and Apple TV+ all have established SAG-AFTRA residual reporting systems. The producer remains responsible for ensuring residuals flow correctly through the distributor. This obligation doesn't disappear if the distributor fails to pay -- the producer is ultimately liable.

What happens if the production exceeds $250,000 after ULB registration?

SAG-AFTRA can require re-execution under the MLB agreement and payment of the P&H differential retroactively across all performer compensation. Productions budgeting within $15,000 of the ULB ceiling should register under MLB from the start to avoid this exposure. The threshold is based on total negative cost at audit, which SAG-AFTRA can request via the production's final cost report at any point during or after production.

Do SAG-AFTRA low budget agreements cover background performers?

No. SAG-AFTRA theatrical low budget agreements govern principal performers: those with speaking roles and significant featured action. Background performers are covered under a separate SAG-AFTRA Background Agreement with different scale rates and administrative requirements. Most low budget productions use non-union background performers, which both ULB and MLB permit, as long as principal performers hold proper SAG-AFTRA agreements.

What is a Taft-Hartley filing and when is it required?

A Taft-Hartley filing notifies SAG-AFTRA that a non-union performer has been hired and provides justification for why a union performer was not used instead. It must be filed within 15 days of the non-union performer's first day of work. The filing includes a written statement explaining why the specific role required this specific performer. SAG-AFTRA reviews the filing and may approve or deny it. Unapproved Taft-Hartley employment results in a fine.

Related Tools and Resources

The Budget Breakdown Calculator models above-the-line cast costs at both ULB and MLB scale rates simultaneously, including P&H on the MLB scenario. The Crew Size Estimator helps set department budget parameters before the above-the-line cast budget is locked. For productions navigating union obligations alongside financing decisions, the how to build an indie film budget post covers above-the-line, below-the-line, and contingency budgeting with P&H as a separate budget category.

The current SAG-AFTRA low budget rate schedules are published at sagaftra.org/production-center. The IFTA (Independent Film and Television Alliance) also publishes member resources on standard production agreement structures at ifta-online.org.

The Agreement That Fits Your Actual Budget

The choice between ULB and MLB is a budget math problem before it is a casting problem. A $180,000 film uses ULB because the economics support it. A $500,000 film uses MLB because it has to. The films that get into trouble are the ones that register under ULB without a buffer, overrun into MLB territory, and discover the retroactive P&H liability after the fact.

Lock your budget. Calculate P&H on every MLB scenario. Post the signatory deposit before casting. Those three steps handle the majority of SAG-AFTRA compliance problems that first-time producers encounter.

Have you negotiated a Taft-Hartley filing or a deferred compensation arrangement on a low budget SAG-AFTRA production? What part of the paperwork process took longer than you expected?