Film Credit Changes Brewing
California tries to get back in the game as North Carolina pulls out.
So there have been some interesting changes in the film tax credit business lately. It seems California has finally decided to do something about the fact that the film industry has been abandoning the state in mass in exchange for more lucrative offers – including here in Louisiana.
On Sept. 18, California Governor Jerry Brown signed AB1839 into law – a bill that raises the state’s cap on its 20 to 25 percent credits from $100 million to $330 million starting July 2015.
But according to many industry professionals, it’s too little, too late.
Leonard Alsfeld is president and CEO of FBT Investments. The company’s FBT Film & Entertainment division was started in 2003 in response to Louisiana’s new film credit program and has since grown to become the largest tax credit broker in the state. According to Alsfeld, the bill is nothing more than a band-aid and will have no effect on Louisiana.
“It’s purely a defensive move,” he says. “It’s not going to be enough to lure films to go there. It’s just the legislature’s way of making them look like they’re in the game.”
The fact is, even though California is set to triple their cap, they still have a cap. According to non-profit FilmL.A. Inc., California is the only top five film production player that caps their credits. Louisiana, on the other hand, has no cap and offers 10 percent higher credits.
But there is another piece of film credit news that Alsfeld says will likely have an effect on Louisiana’s film industry – and it’s all good.
North Carolina, a state with a long-standing history in the film business – with regular production going on since the 1980s and a film credit program that since 2010 has offered 25 percent – has announced that their credit program will officially end on Dec. 31 of this year. The credits are instead being replaced with a $10 million grant program.
To put this into perspective, according to The Hollywood Reporter, $10 million is less than what the state paid in 2012 to just one film: Iron Man 3.
“When those filmmakers inevitably go looking for a new home, it’s bound to be good for us,” Alsfeld says.
Meanwhile, Louisiana continues to expand its infrastructure. Rumor is that film giant Starlight Studios will soon be making an announcement about its planned move to a 32-acre location in east New Orleans.
Kimberley Singletary is the managing editor of Biz New Orleans magazine. A 20-year Southern California veteran, she has been surrounded by the film industry for most of her life and is thrilled to be covering its emersion in her newly adopted home.