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Film officials say cut of credits would hurt business

Last Modified: Friday, May 10, 2013 9:08 AM

By Lance Traweek / American Press

A film industry official expressed concerns Thursday over the Legislature’s plan to cut back on movie tax credits in Louisiana.

“It wasn’t until the tax incentive was put into effect that the industry started growing,” said Will French, president of the Louisiana Film and Entertainment Association. “These jobs are created 100 percent by these tax incentives.”

Film production in Louisiana has increased by more than 85 percent from 2010 to 2012, according to a recent report by Louisiana Economic Development.

“It is clear that the program is performing as designed and continues to increase the economic impact to the state,” the report reads.

The economic benefit of the tax credit program for 2012 totaled $1.1 billion in annual spending on in-state businesses and more than $700 million in household earnings. And net cost to the state were about $164.5 million, according to the report.

More than 15,000 jobs were created because of the film industry, it says.

But according to the state Legislative Auditor’s Office, Louisiana received only $27 million in tax revenue from the $196.8 million in credits LED issued in 2010 — a net cost to the state of $169.8 million for that year alone.

A few months ago, Gov. Bobby Jindal proposed a cutback of the plan, but backed off of it and left it up to the Legislature.

The House of Representatives has rewritten Jindal’s budget. Its plan would raise $20 million by revising the state’s movie tax credits. Final action takes place in the House today before the budget goes to the Senate.

“There are changes that could be considered, but we are in the early stages of reviewing that right now,” said Economic Development Secretary Stephen Moret. “But I think it’s very important that we maintain a thriving film industry.”

French said the “talks alone” of cutting the tax incentives are making people in the film industry “unsettled.” He said he’s already seeing people in the industry looking at options that don’t include Louisiana.

Michael A. McGowan, owner of Los Angeles-based Sedona Studios, filmed “How to Love a Geek” in Lake Charles last year. McGowan said he knows of four productions that are backing out of filming in Louisiana.

“This is a business at the end of the day,” McGowan said. “We’re going to go where we’re getting the best deal.”

“If you make a cut to film to any extent, we’re going to be a lot less competitive and have far less business,” French said. “I thought the old days of Louisiana politics were behind us, but I’m as worried as I can be.”

“These movies plan projects years in advance. They need commitment from the state,” said Megan Hartman, who manages the Southwest Louisiana Film Commission, an umbrella organization under the Southwest Louisiana Convention & Visitors Bureau. “It’s all because of the tax incentives. That’s been the driving force for so many projects.”

Louisiana is ranked third in the nation for the most desirable places to film, behind California and New York, French said.

“The film industry is decentralizing from its historic hubs,” French said. “With advances in technology, you can now make a film from start to finish anywhere in the country.”

Posted By: Flora Stringer On: 5/10/2013

Title: Film officials say cut of credits would hurt business

Very good coverage; excellent information, informative and excellent presentation.

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