I was interviewed yesterday on Lockwood Phillips’ Viewpoints radio to discuss my Spotlight report on film incentives and my Policy Report on Carolina Cronyism. Those interested can find the interview here.
Speaking of film incentives, I learned yesterday that Louisiana, the prime mover and “gold standard” in state film tax incentives, is also rethinking them and 400 other tax incentives, which are “diverting more than $4 billion that could be used to fund hospitals, colleges and other state services”:
State Rep. Jim Fannin, D-Jonesboro, who sponsors the state’s budget bill, said the film production tax credit program needs to be reviewed because it does not appear to be cost effective.
“It needs to be good for both parties. It needs to be good for the state and it needs to be good for industry,” he said. …
An economic analysis by BaxStarr Consulting Group showed that motion picture production generated $27 million in state tax revenue in 2010 while certifying $196.8 million in tax credits. Mathematically, that is roughly $1 of state tax income for every $7 in credits.
Meanwhile, the StarNews did a story on NC’s incentives, and a quotation from that story buttressed my point that, despite incentives’ supporters saying they create a steady flow of work, “the ongoing incentives battles between the states as well as com- petition from Canadian provinces and other nations (what The Economist called ‘a beggar-thy-neighbor trade war’) mean that no particular level of state incentives could be guaranteed to sustain a stable rate of production in the state”:
Although a number of other factors, such as crews, sound stages and weather conditions are considered when filmmakers’ choose where to launch their next project, film incentives are a big part of the decision-making process, Griffin said.
Nowhere is that more apparent than at the annual Association of Film Commissioners International trade show in Los Angeles a few weeks ago.
“There were 200 exhibitors and 170 film commissions from 40 different countries,” [Wilmington Regional Film Commission Director Johnny Griffin] said. Ninety percent of them had in big, bold letters on their booths the percentages of their incentives. So it’s talked about – absolutely.”