Wednesday, December 1, 2010

Re: [MISP] STATE FILM SUBSIDIES: NOT MUCH BANG FOR TOO MANY BUCKS

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I have to disagree. If so much money is going to LA, then why is
California having a budget crisis?

A lot of the studies don't consider the impact money spend affects others
industries such as hotel and food services. And I even feel the effects
of the film industry in little Grants. There are way more opportunities
for my students now than five years ago. If a student here works hard and
really wants an opportunity, I can find them one now. That wasn't the
case five years ago.

And we have to praise the efforts to bring a "clean" industry to our state
rather than one that strips our natural resources.

I have seen the need to provide more "mid-budget" support though. We need
to do what we can to encourage the growth of New Mexico based productions
including game design and new media to keep the growth going, but let's
not advocate throwing the baby out with the bath water.

Doug Bocaz-Larson
NMSU-Grants

On Wed, December 1, 2010 12:50 pm, Larry N Stouffer wrote:
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>
> Karen, even including the sardonic: "You can be sure the new
> administration has" insert, I appreciate your posting the article. My
> hope is that the new administration DOES do an apolitical study on
> this and all other state investments. It's about time the voters knew
> the truth about what is happening with their tax dollars. I'm sure you
> agree.
>
> If the movers and shakers in the NM film community are right and the
> state - and not just the unions - is in fact benefiting financially
> from the so-called tax incentive program, it will be a time for
> rejoicing. Personally I think the "loan" program should be scrapped.
> All the ()&$*# money is going to LA, anyway. And to folks who don't
> even need it! The tax incentive rebate plan, I would hope, would
> survive scrutiny.
>
> Perhaps dropping the loans and upping the rebate % to remain
> competitive with Michigan would be best for all. Anyway, that's my
> thinking.
>
> I'm certain we all are anxiously awaiting our new Governor's
> consideration.
>
> Thanks again, Karen.
> - Larry -
> Larry N Stouffer
>
> â€" 13th Annual â€"
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> May 27 thru 31, 2011 in stunning Santa Fe, NM
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> www.scsfe.com - phone 505.424.1501
>
>
>
>
>
>
>
>
> On Dec 1, 2010, at 11:58 AM, Karen Koch wrote:
>
>> ***This is a MISP Listserv message. Responses are sent to the list
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>>
>> Check out this Center on Budget & Policy Priorities report on Film
>> Business Subsidies. You can be sure the new administration has.
>> The 17 page report is attached as a pdf but below is the opening
>> premise ...
>> Like a Hollywood fantasy, claims that tax subsidies for film and TV
>> productions â€" which nearly
>> every state has adopted in recent years â€" are cost-effective tools
>> of job and income creation are
>> more fiction than fact. In the harsh light of reality, film
>> subsidies offer little bang for the buck.
>> ï‚· State film subsidies are costly to states and generous to movie
>> producers. Today, 43
>> states offer them, compared to only a handful in 2002. Over the
>> course of state fiscal year 2010
>> (FY2010), states committed about $1.5 billion to subsidizing film
>> and TV production (see
>> Appendix Table 1) â€" money that they otherwise could have spent on
>> public services like
>> education, health care, public safety, and infrastructure.
>> The median state gives producers a subsidy worth 25 cents for every
>> dollar of subsidized
>> production expense. The most lucrative tax subsidies are Alaska’s
>> and Michigan’s, 44 cents and
>> 42 cents on the dollar, respectively. Moreover, special rules allow
>> film companies to claim a
>> very large credit even if they lose moneyâ€" as many do.
>> ï‚· Subsidies reward companies for production that they might have
>> done anyway. Some
>> makers of movie and TV shows have close, long-standing relationships
>> with particular states.
>> Had those states not introduced or expanded film subsidies, most
>> such producers would have
>> continued to work in the state anyway. But there is no practical way
>> for a state to limit
>> subsidies only to productions that otherwise would not have happened.
>> ï‚· The best jobs go to non-residents. The work force at most sites
>> outside of Los Angeles and
>> New York City lacks the specialized skills producers need to shoot a
>> film. Consequently,
>> producers import scarce, highly paid talent from other states. Jobs
>> for in-state residents tend to
>> be spotty, part-time, and relatively low-paying work â€" hair
>> dressing, security, carpentry,
>> sanitation, moving, storage, and catering â€" that is unlikely to
>> build the foundations of strong
>> economic development in the long term.
>>  Subsidies don’t pay for themselves. The revenue generated by
>> economic activity induced by
>> film subsidies falls far short of the subsidies’ direct costs to
>> the state. To balance its budget, the
>> state must therefore cut spending or raise revenues elsewhere,
>> dampening the subsidies’ positive
>> economic impact.
>> 820 First Street NE, Suite 510
>> Washington, DC 20002
>> Tel: 202-408-1080
>> Fax: 202-408-1056
>> center@cbpp.org
>> www.cbpp.org
>> 2
>>  No state can “win” the film subsidy war. Film subsidies are
>> sometimes described as an
>> “investment” that will pay off by creating a long-lasting
>> industry. This strategy is dubious at
>> best. Even Louisiana and New Mexico â€" the two states most often
>> cited as exemplars of
>> successful industry-building strategies â€" are finding it hard to
>> hold on to the production that
>> they have lured. The film industry is inherently risky and therefore
>> dependent on subsidies.
>> Consequently, the competition from other states is fierce, which
>> suggests that states might
>> better spend their money in other ways.
>> ï‚· Supporters of subsidies rely on flawed studies. The film industry
>> and some state film
>> offices have undertaken or commissioned biased studies concluding
>> that film subsidies are
>> highly cost-effective drivers of economic activity. The most
>> careful, objective studies find just
>> the opposite.
>> Given these problems, states would be better served by eliminating,
>> or at least shrinking, film
>> subsidies and using the freed-up revenue to maintain vital public
>> services and pursue more costeffective
>> development strategies, such as investment in education, job
>> training, and infrastructure.
>> Effective public support of economic development may not be
>> glamorous. However, at its best, it
>> creates lasting benefits for residents from all walks of life.
>> State governments cannot afford to fritter away scarce public funds
>> on film subsidies, or, for that
>> matter, any other wasteful tax break. On the contrary, policymakers
>> should broaden the base of
>> their taxes to create a fairer and more neutral tax system.
>> Film
>> LEAVING THE LIST /LIST INFO: To leave the list, please email us at:
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>> <Film Subsidies.pdf>
>
>
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--
Doug Bocaz-Larson
Program Manager: Computer Science and Creative Media
New Mexico State University - Grants
1500 3rd St.
Grants, NM 87020
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505-290-1331 cell

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