North Carolina legislators have ditched the state’s longtime film and TV incentives program amid a conservative push to cut back on such government support.
“We knew that this would be an uphill battle and we were cautiously optimistic,” said Johnny Griffin, director of the Wilmington (N.C) Regional Film Commission. “The problem was that a lot of legislators were philosophically opposed to any incentives, period. So we were absolutely not surprised.”
North Carolina has been home to 800 productions over the past three decades.
TV series recently shot in North Carolina include CBS’ “Under the Dome,” ABC’s “Secrets and Lies” and Fox’s “Sleepy Hollow.” Recent movies include “Iron Man 3,” “The Hunger Games,” “Tammy,” “The Longest Ride” and Relativity’s untitled heist drama about the 1997 Loomis Fargo robbery.
The state’s legislature decided to end North Carolina’s current 25% incentive program — which is covering about $300 million in production expenditures this year — and replace it next year with a grant program for movie and TV productions with a total annual cap of $10 million in grants.
That means the state will only be able to provide incentives to cover a total of $40 million in production expenditures in 2015. Griffin said North Carolina will probably see productions begin to depart at that point and the Motion Picture Assn. of America issued a statement predicting the new grant program will be ineffective.
“Under the current production incentive program, film and TV production supports over 4,000 jobs in North Carolina and brings millions of dollars in direct spending all across the state,” the MPAA said. “It’s disappointing that the new grant program included in the budget agreement will prevent North Carolina from remaining competitive in attracting this prominent source of in-state economic activity.”
The issue of using state funds to provide incentives for the film and TV business has drawn a concerted attack from conservatives since last year with the Americans for Prosperity group — backed by the Koch brothers — asserting that the incentives were not working.
“The film tax incentives are not proven job creators or overall government revenue enhancers, despite what proponents say,” wrote Donald Bryson, deputy director of the group in North Carolina, earlier this year. “In state after state, from Connecticut to Louisiana to Ohio, film incentives have been found to be net revenue losers.”
“And job creation?” Bryson added. “Iowa, Kansas, Missouri and Wisconsin have two things in common. All four have terminated their film incentive programs – and all four have lower unemployment rates than North Carolina, according to the federal Bureau of Labor Statistics.”
Bryson contended that the state needed to widen the tax base by eliminating targeted tax credits and cutting overall tax rates “instead of subsidizing its favorite industries with tax credits.”
North Carolina’s program — along with those in New York, Georgia, Louisiana and New Mexico — had been able to lure productions away from California, where an incentive program providing $100 million a year has been in effect only since 2009.
Legislation to increase the size of California’s program to $400 million per year is currently in the state Senate. Backers of the bill staged a rally this week at the state capitol, drawing several hundred supporters that included actors Carl Weathers, Daniel Stern and Ron Perlman.