From the Roundhouse: Lights, Camera… Action?January 31st, 2013 at 7:22 pm by Alex Goldsmith under Latest Posts, Politics
The glamour of Hollywood is tough to ignore.
Forty-four states including New Mexico have some form of a film production incentive on the books.
New Mexico’s 25 percent film tax credit, relative closeness to Los Angeles and dramatic and varied scenery make the state an especially attractive destination for TV and movie producers.
Projects such as the hit TV series “Breaking Bad” and “In Plain Sight” and movies such as “Transformers” and “The Avengers” have all come here as a result.
It was even more attractive when it was an unlimited pool of money. If your production qualified, you got paid.
That is until 2011 when state lawmakers and Gov. Susana Martinez made a big push to cap the incentives at $50 million each fiscal year.
Two years later, there’s a new fight brewing over whether the incentives should be uncapped again.
The governor has stood firm saying a cap lets the state budget its money, while some Democratic lawmakers like Sen. Phil Griego, D-San Jose, say the industry could create more jobs in New Mexico without a cap.
Given the governor’s firm stance right now, the return to uncapped days for the film industry is unlikely, but something else is.
Rep. Moe Maestas, D-Albuquerque, who says he’d prefer it if the cap were gone, has proposed a compromise bill instead.
Currently, if the $50 million in film incentives isn’t spent, it goes back to the general fund. Maestas’ bill would allow that money to roll over and be spent in the next fiscal year if not enough projects come to the state.
With the cap looming, a number of producers made claims in the 2011 fiscal year artificially inflating the amount of credits paid out to $96 million. That also artificially deflated the amount paid out in FY12 to just $9.4 million, well under the cap.
So far TV and movie productions in the state have gotten $21 million paid out about halfway through FY13, meaning the cap might not be reached.
Maestas’ bill also would give TV series special treatment, bumping the credit for any show that commits to at least six episodes from 25 percent to 30 percent.
The idea behind that is that without knowing, you would be hard pressed to watch “The Avengers” and realize much of it was filmed in Albuquerque. But with a show like “Breaking Bad,” the setting is unmistakable.
Because of that branding advantage and the longevity of some shows, Maestas believes investing more there would ultimately benefit the state’s economy.
The compromise bill was just introduced today, but a positive critical review may be in the cards for it in Santa Fe.
It would scrap most of New Mexico’s tax code, including personal and corporate income tax and all deductions, in favor of a 2-percent gross receipts tax on everything spent.
It’s a big idea that isn’t being immediately dismissed by Democrats with Sen. John Arthur Smith, D-Deming, saying he likes the proposal if it’s revenue-neutral, but an idea that almost certainly won’t get implemented this year.
The House version has to go through a whopping six committees and the Senate version has to go through a still high four of its own. Most bills get referred to just two committees.