Fate of film incentives in lawmakers' hands
Published April 22, 2014
by Molly Parker, Wilmington Star-News, April 21, 2014.
Finding the legislative willpower to extend North Carolina's film credits so coveted by film supporters in Wilmington, Charlotte and the state's other TV and movie towns will require the support of legislators from areas less directly affected by the industry.
An informal poll of some of those lawmakers by the StarNews drew mixed reaction to the incentive program that expires at the end of this year.
State Rep. Jimmy Dixon, a Republican representing Wayne and Duplin counties, said his position on that is a "little bit in the middle."
"It's not a yes or a no," he said. "I'm not in favor of carte blanche cutting those incentives off. I think that would be unfair to the industry."
Dixon said he thinks the state should move "judiciously in a different direction" away from incentives. But said that should happen over a period of several years.
"I would not just chop it off," Dixon said. "I think it's under the best of circumstances a decade-long transition to a system better than incentives for any industry in North Carolina. It's going to take a while to get there.
"It would not be a good business decision to abruptly do something."
BIPARTISAN SUPPORT
The state's film incentive program was beefed up by the Democratic-controlled legislature in 2010 to include allowing film companies to recoup 25 percent of their qualifying expenses. Prior to the change, North Carolina's film industry was languishing.
Support for the film incentive has been bipartisan. State Commerce Secretary Sharon Decker, a high-profile member of Gov. Pat McCrory's team, has expressed support.
But some state lawmakers, including local state Reps. Rick Catlin, R-New Hanover, and Chris Millis, R-Pender, have raised questions about the constitutionality of the current film incentive and proposed legislation to rewrite it.
The industry, however, said any changes to water down the program would have an adverse impact on its dealings in North Carolina.
More recently, several economic studies have been released that paint different pictures about the financial impact of the incentive program and its cost to state taxpayers.
JOBS IN THE BALANCE
State Rep. Andy Wells, R-Catawba, said the film industry is not a huge issue in the Catawba Valley so he doesn't hear much about it from constituents.
"I think to some extent that conversation is up in the air," he said. "Let's just say I've got an open mind. However, I do want to make sure we're getting the most bang for the taxpayer's money."
The N.C. Production Alliance said in a statement that it is working diligently to educate lawmakers and others from those areas of the state where film and television may not be so prominent.
The organization plans to release a map in the next few weeks that it says will illustrate the nearly 70 counties where films, commercials or vendors create steady jobs, said alliance spokesman Katy Feinberg. This work is being done in advance of the General Assembly's short session that begins next month, during which time film supporters hope to see the incentives extended for the film industry.
The alliance says there are hundreds of jobs hanging in the balance.
"We are overwhelmed by the outpouring of friends and advocates joining the North Carolina film community," Feinberg said. "People have been coming out of the woodwork in support of North Carolina's film credit. The North Carolina Production Alliance is working closely with vendors and small businesses to promote the film industry's economic impact in remote parts of our state.
"By highlighting tourism and education-related activities and jobs, hundreds of taxpaying North Carolinians now have a better understanding of just how far-reaching film's net benefits stretch."
State Rep. Mike Stone, a Republican representing Lee and Harnett counties, said he's listening to the conversation but hasn't made up his mind yet about where he stands on the issue. He said very few of his constituents are concerned about the film incentive, but said he's paid attention to the debate and has more questions than answers.
"Until we know those questions and answers I don't want to go out on a limb and comment either way," Stone said.
Some lawmakers not directly affected by the industry are still supportive of the incentive.
State Sen. Jim Davis, a Republican representing the far western portion of the state, said he didn't know enough about the incentive program to make an intelligent comment.
But, he said, it's his understanding that the film incentive is a net gain for the state.
"So it appears to be a good investment," Davis said. "It seems kinda foolish to cut it purely on a business decision."
http://www.starnewsonline.com/article/20140421/ARTICLES/140429947/1015/news0101?template=printart
April 22, 2014 at 10:23 am
Norm Kellly says:
'a map in the next few weeks that it says will illustrate the nearly 70 counties where films, commercials or vendors create steady jobs'. Bloody good for the film industry. However, there are other companies that are in more than 1 county and produce steady jobs. Yet those businesses are required to pay taxes and get no incentives. But they are creating steady jobs. Why is the film industry singled out for special treatment? For that matter, why is ANY business singled out for special treatment?
The problem with incentives is that it puts power of choosing winners & losers in the hands of POLITICIANS not the MARKET! Where does the power of decision making belong? In the hands OF THE PEOPLE. Read the Constitution of the US (cuz I don't care about any other country's constitution!). Somewhere in there doesn't it use the words 'we the people'? Or did I misread that? Does it really say 'we the politicians'? Maybe I really do need new reading glasses.
If I were to start a business and I had to pay unemployment taxes, sales taxes, property taxes, etc tax, etc tax, etc tax, then would I appreciate the film industry special exception? Or would I despise the special exception for the film industry? What if my business was somehow connected to supporting a film industry business? They get a special tax incentive but I don't. Not only am I paying taxes, but I'm paying for the business that I supply/support to STAY IN BUSINESS! Why does this sound right to anyone?
If the tax field were leveled for EVERY BUSINESS, wouldn't that be more fair for ALL BUSINESSES? Please remember that it's the libs among us that constantly scream about leveling the playing field. The difference between my call for a level playing field and the libs idea is that they lie about it, while I expect it's the right thing to do. Libs level the playing field by stealing money from successful people and GIVING it to 'the poor', and people who don't bother to put forth effort to better themselves, and to people they choose. Leveling the playing field according to libs does things like increase the incentives for a chosen business while penalizing the rest of business, as well as special penalizing for the most hated businesses.
"So it appears to be a good investment," Davis said. What makes a good investment for government? What part of the constitution provides backing for the state making any investment? Does the state making this investment hurt/harm other businesses that aren't considered a good investment? If the local tire/car repair store brings taxes to the state, pays property taxes to the community, employes people, is that a good investment? Yes, both for the state and for the business owner. But the state actually DID NOT invest anything in this business. The business owner (and bank) invested in that business and GETS NO SPECIAL treatment by the state. Actually, the state expects that new business to conform to ALL the tax laws or will BE PENALIZED! Why wouldn't that tire/auto repair store be a good investment for the state? Where do you draw the line? At what point does it become counter-productive for the state to invest in business? At what point does it become a conflict of interest for politicians to decide whether or not to 'invest' in some business? At what point does it become immoral for politicians to 'invest' money that DOES NOT BELONG TO THEM!?! When the state forces people & businesses to pay taxes so the state can then turn around and pick & choose which businesses get largesse from the state, is this proper & moral? Not only does my business need to support itself, pay the taxes required by law, and pay the employees who work for me, but some politician decided that my business MUST ALSO support someone else's business? Does this make it easier or harder for my business to survive? To show a profit? To stay in business and keep people employed?
Politicians generally refer to government spending as an investment. This is usually NOT true; but it makes them feel good and justifies their spending in areas where they don't belong. They are trying to justify to me why I should accept them taking money from me to give it to someone else. Why would I feel good about this? Why don't I get to choose where my money is spent or invested?
How did Solyndra work out? How about the ABC stores in NC? Is that a good investment? Or should the state also sell the ABC system to the private market because the state is NOT SUPPOSED to be in business.
Let's go back to the tire/auto repair shop. Let's say someone who works for the film industry or one of the production company vehicles comes into the shop. The shop owner knows the company represented is getting special tax treatment, with up to a 25% reward. Is it right, could it be legal, for the shop owner to charge that customer 25% more to make up the difference? Libs and supporters of special incentives need to think long and hard on this one. I would wait, but it seems futile. It probably hurts even trying to take my suggestion. I'll help you out on this one. No, it's not legal for the owner to charge that tax-supported customer more! No, there's not a lib out there who would support allowing that business to charge the special business a premium for being in the 'chosen club'. Every politician out there who believes it is right to take money from some company and give it to some other company would object to the tire store charging a film industry entity different by charging them more. It's OK/moral/acceptable for government to treat people different, but it's not OK/acceptable for individuals or businesses to treat people different. Ask yourself why? Then ask yourself why you believe this special treatment should continue. Hurts, doesn't it?! Do it some more and you'll become a conservative. (talk about negative incentive!)
April 22, 2014 at 10:26 am
TPWohlford says:
The problem is that if you lissen to Yankees, they sometimes give you bad ideas. This might be one of 'em.
The bad news is that, if you don't lissen to Yankees like me, you don't hear us say things like, "Don't do it!".
'Cause up north, I know of an entire town that went bankrupt when it got stars in its eyes and built a huge movie studio 'cause of all the films that were supposed to be filmed in Michigan due to tax subsidies/breaks.
But hey, I'm "not from around here" so far be it for me to share with anyone how my folks "back home" screwed up.
