The state fiscal crisis has turned one of the last decade’s biggest hits into this year’s Ishtar. Many of the 44 states that currently offer incentives for motion picture production are mulling plans to reduce or eliminate their film programs.
Michigan Gov. Rick Snyder is leading the way by retiring the nation’s most generous production incentive—a tax credit that reimbursed filmmakers for 42 percent of the budgets of films made in-state. Michigan taxpayers have spent nearly $300 million chasing the tinsel dragon since 2008, and they are expected to have paid out well over $400 million by 2013, when the program finishes winding down.
All that money brought a boom in Motor State moviemaking. But as with any good movie villain, production incentives extracted a terrible price. A devastating financial review by the Michigan Senate Fiscal Agency last fall found the state spent $190.3 million to create 6,217 part-time jobs in 2008 and 2009. That comes to $46,695 per part-time job. If you estimate, as the agency did, that 6,217 part-time jobs equal 571.5 full-time jobs, that’s $507,962 per job funded. The numbers were also moving in the wrong direction: The state has been spending consistently more per job created since 2008.
Results like these have many states ready to yell cut. Gov. John Kasich is rumored to be considering an end to Ohio’s production incentives. New Mexico Gov. Susana Martinez has capped annual production incentives at $45 million. (The Land of Enchantment paid out $76 million to filmmakers in 2009.) Kansas has suspended its program, and Iowa’s came to a halt after a filmmaker admitted to defrauding the state out of millions for two nonexistent pictures.
One state bucking the trend is Louisiana. The state’s film office grants up to 35 percent in production and labor incentives and has attracted scores of productions—even the $75 million science fiction feature Battle: Los Angeles, which substituted Baton Rouge for Santa Monica. The incentive program has grown rapidly during the last decade, despite a 2005 legislative analyst’s finding that the Pelican State was recouping only 16 percent to 18 percent of the amount it was spending to attract production.