{"id":1067,"date":"2014-02-21T11:53:04","date_gmt":"2014-02-21T19:53:04","guid":{"rendered":"http:\/\/www.artsjournal.com\/worth\/?p=1067"},"modified":"2014-12-03T04:31:30","modified_gmt":"2014-12-03T12:31:30","slug":"today-in-film-tax-credits","status":"publish","type":"post","link":"https:\/\/www.artsjournal.com\/worth\/2014\/02\/today-in-film-tax-credits\/","title":{"rendered":"Today in film tax credits (Updated December 2, 2014)"},"content":{"rendered":"

\"created<\/a>It never ends: production companies asking for, and getting, tax credits for local production when the economic case is cloudy, to say the least. The Washington Post<\/em> reports<\/a>:<\/p>\n

A few weeks before\u00a0Season 2 of \u201cHouse of Cards\u201d\u00a0debuted online, the show\u2019s production company sent Maryland Gov. Martin O\u2019Malley\u00a0a letter with this warning: Give us millions more dollars in tax credits, or we will \u201cbreak down our stage, sets and offices and set up in another state.\u201d …<\/p>\n

Both seasons of \u201cHouse of Cards\u201d were filmed in Maryland, mostly in Baltimore and Harford County, although the House chamber in Annapolis\u00a0was used as a set.<\/p>\n

In addition to bringing a burst of buzz and excitement, the show created nearly 6,000 jobs and pumped more than $250\u00a0million into the state economy, economic development officials say.<\/p>\n

In May, O\u2019Malley (D) visited the set to promote film tax credits, exulting that Maryland was becoming \u201cthe premier destination in America for film production.\u201d<\/p><\/blockquote>\n

Sure it is.<\/p>\n

After each season, Maryland has reimbursed Media Rights Capital, the show\u2019s California-based production company, for a chunk of production expenses. For the first season, that totaled more than $11 million in tax credits. For the second season, reimbursements could reach $15\u2009million.<\/p>\n

Maryland economic development officials wanted to promise \u201cHouse of Cards\u201d another $15\u2009million in credits for the third season, which was supposed to start filming in early spring.<\/p>\n

But lawmakers have not agreed to boost the $7.5\u00a0million in tax credits the state allocates annually for film and television projects. Two bills that would increase the ceiling \u2014 to $11\u00a0million or $18.5 million \u2014 are in committee. House leaders say some increase is likely, but whether it will be enough to keep the show in town is unclear.<\/p><\/blockquote>\n

Two questions.<\/p>\n

First, if these production credits are a boon to the state’s economy, why put a ceiling on the amount of the credits? Why not make it unlimited, and let the state become fabulously wealthy? But we know the answer: film tax credits help the production companies who lobby for them, but we have scant evidence that the state as a whole benefits.<\/p>\n

Second, where do they get those economic impact numbers? imdb.com<\/a> says the budget for Season 1 of House of Cards<\/em> was $60 million (films have been made in Maryland for 1\/1000th that cost<\/a>, and have done rather well). Yet somehow this has an “economic impact” of $75 million<\/a>, or, on another day, another estimate, $140 million<\/a>. Mind you, the show has created 2,000<\/a> jobs. Or maybe 6,000<\/a>. Or … who knows?<\/p>\n

Film tax credits are not arts policy, they are industrial policy. And they are bad industrial policy – chasing klieg lights makes no more sense than the policy of states’ chasing smokestacks in the previous century. Yet states continue to fall for the idea that somehow this all amounts to strategic economic development.<\/p>\n

Update: from Alyssa Rosenberg<\/a>.<\/p>\n

Update, December 2, 2014: The Washington Post<\/em><\/a> reports:<\/p>\n

Maryland\u2019s tax incentives for film production only brings in 10 cents for every dollar spent, and the legislature should let it expire in 2016, a\u00a0study from the\u00a0Department of Legislative Services recommends. …<\/p>\n

For every dollar granted by the credit, the state receives 6 cents, and local governments receive 4 cents. About 97 percent of the $62.5 million Maryland has spent on the tax credit since the beginning of the 2012 fiscal year has been spent on two shows: \u201cHouse of Cards\u201d and \u201cVEEP.\u201d \u201cHouse of Cards\u201d is filmed in Baltimore, and \u201cVEEP\u201d is filmed in Baltimore and Sykesville, Md., according to IMDb.<\/p>\n

\u201cSince the credit does not provide sustainable economic development and\u00a0provides\u00a0a small return on investment to the state and local government, DLS recommends that the General Assembly allow the film production activity tax credit to sunset as scheduled on July, 2016,\u201d the\u00a0study reads.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

It never ends: production companies asking for, and getting, tax credits for local production when the economic case is cloudy, to say the least. The Washington Post reports: A few weeks before\u00a0Season 2 of \u201cHouse of Cards\u201d\u00a0debuted online, the show\u2019s production company sent Maryland Gov. Martin O\u2019Malley\u00a0a letter with this warning: Give us millions more […]<\/p>\n","protected":false},"author":3,"featured_media":1070,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[26],"tags":[],"class_list":{"0":"post-1067","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-issues","8":"entry"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/www.artsjournal.com\/worth\/wp-content\/uploads\/2014\/02\/Maryland-film-tax-credit.jpg","jetpack_shortlink":"https:\/\/wp.me\/p3dIW5-hd","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":1320,"url":"https:\/\/www.artsjournal.com\/worth\/2014\/06\/film-tax-credits-jobs-and-lost-incomes\/","url_meta":{"origin":1067,"position":0},"title":"Film tax credits, jobs, and lost incomes","author":"Michael Rushton","date":"June 2, 2014","format":false,"excerpt":"This morning artsjournal.com links to yet another chapter in the endless series of different states, provinces and countries deciding how much in tax credits ought to be granted to commercial film and television production, because: jobs. I recently posted re Maryland here. Today, Hollywood Reporter, er, reports: the California Film\u2026","rel":"","context":"In "issues"","block_context":{"text":"issues","link":"https:\/\/www.artsjournal.com\/worth\/category\/issues\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2014\/06\/the-last-picture-show-poster.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":1468,"url":"https:\/\/www.artsjournal.com\/worth\/2014\/08\/doras-amazing-tax-credit-adventure\/","url_meta":{"origin":1067,"position":1},"title":"Dora’s amazing tax credit adventure","author":"Michael Rushton","date":"August 18, 2014","format":false,"excerpt":"The New York Times Arts page reviews the new adventure of Dora the Explorer, now a little older, and starring in 'Dora and Friends: Into the City!', which apparently looks pretty suburban. And Dora's talking backpack is full of dollars, courtesy of New York state taxpayers. Variety reports: While states\u2026","rel":"","context":"In "issues"","block_context":{"text":"issues","link":"https:\/\/www.artsjournal.com\/worth\/category\/issues\/"},"img":{"alt_text":"indeed","src":"https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2014\/08\/swiper-265x300.png?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":1148,"url":"https:\/\/www.artsjournal.com\/worth\/2014\/03\/tax-relief-for-british-theatre\/","url_meta":{"origin":1067,"position":2},"title":"Tax relief for British theatre (updated)","author":"Michael Rushton","date":"March 20, 2014","format":false,"excerpt":"The budget just announced by the British government provides for significant tax relief for live performing arts. Here are reports from The Stage, The Telegraph, and The Independent. The Stage gives details as follows: The scheme will mean producers are able to claim up to a 25% tax rebate on\u2026","rel":"","context":"In "issues"","block_context":{"text":"issues","link":"https:\/\/www.artsjournal.com\/worth\/category\/issues\/"},"img":{"alt_text":"how shall we spend it?","src":"https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2014\/03\/Blithe-Spirit-at-the-Schu-002.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":3049,"url":"https:\/\/www.artsjournal.com\/worth\/2024\/07\/does-it-matter-if-the-subsidized-arts-are-mostly-attended-by-the-well-off\/","url_meta":{"origin":1067,"position":3},"title":"Does it matter if the subsidized arts are mostly attended by the well-off? (updated)","author":"Michael Rushton","date":"July 24, 2024","format":false,"excerpt":"I have a new paper out, \u201cThe pursuit of equality through public funding for the arts\u201d, in\u00a0Innovating Institutions and Inequities in the Arts, edited by Joanna Woronkowicz and Doug Noonan.1 To explain what it is about, let me start with a completely different policy field: reducing the use of fossil\u2026","rel":"","context":"In "issues"","block_context":{"text":"issues","link":"https:\/\/www.artsjournal.com\/worth\/category\/issues\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2024\/07\/image-1.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2024\/07\/image-1.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2024\/07\/image-1.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2024\/07\/image-1.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2024\/07\/image-1.png?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":1310,"url":"https:\/\/www.artsjournal.com\/worth\/2014\/05\/why-tax-breaks-for-commercial-theatre\/","url_meta":{"origin":1067,"position":4},"title":"Why tax breaks for commercial theatre?","author":"Michael Rushton","date":"May 23, 2014","format":false,"excerpt":"The Stage reports (and I repost the story in full here): Tax breaks for the theatre industry to be introduced this autumn could bring in \u00a3100 million for commercial theatre and \u00a320 million for touring productions in coming years, Arts Council England\u2019s chair PeterBazalgette has said. He said the initiative\u2026","rel":"","context":"In "issues"","block_context":{"text":"issues","link":"https:\/\/www.artsjournal.com\/worth\/category\/issues\/"},"img":{"alt_text":"coherent arts policy","src":"https:\/\/i0.wp.com\/www.artsjournal.com\/worth\/wp-content\/uploads\/2014\/05\/Pound-Sterling-Progress.jpg?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":1251,"url":"https:\/\/www.artsjournal.com\/worth\/2014\/04\/public-support-for-the-arts-and-the-letter-of-the-law\/","url_meta":{"origin":1067,"position":5},"title":"Public support for the arts and the letter of the law","author":"Michael Rushton","date":"April 28, 2014","format":false,"excerpt":"I was recently interviewed by Nancy Fowler of St. Louis Public radio on the recent controversies surrounding the ethics policies of the Zoo-Museum District. I won't repeat the whole story here, which is best covered in Ms Fowler's piece. 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