Deep impact
By B.J. Reyes
Expanded tax credits for film and television production in Hawaii remain alive – if barely – as the Legislature enters the final week of conference committees next week.
The House has yet to appoint conferees on a number of measures to address the credits. (Those include: House Bills 1308, 2869 and 2338; and Senate Bill 3050.)
On Friday, lobbyists for Comcast/NBC Universal Media were circulating results of an independent study showing that tax credits for media production have resulted in a significant return on investment for Hawaii.
Among the findings:
>> Estimated cost of tax credits to state: $20.4 million.
>> Tax revenues from film production: $25.2 million.
>> Direct/indirect jobs created: 3,287.
>> Film & TV expenditure in Hawaii from 2006-11: $210.7 million.
>> Local productions have led to “Film Induced Tourism” resulting in estimated tax revenue of $62.3 million and 8,900 direct/indirect new jobs.
>> A return on investment for Hawaii of 4:1.
From the report’s executive summary:
“Hawaii’s film and television production industry is an important contributor to the state economy through the creation of jobs and the generation of income tax and tax revenues. In addition, film and television production in Hawaii contributes to the visitor industry through the worldwide exposure of these productions.”
The 63-page report was prepared for the Motion Picture Association of America by the consulting firm of MNP LLP.
Political Radar
April 20th, 2012 at 9:47 pm
Assumptions and Approximations.
Need an audit to really see where the money is leaking. Into someone’s pocket.
April 20th, 2012 at 10:09 pm
They must have some fantastic multipliers in that report. Literally. Seriously.
April 23rd, 2012 at 11:25 am
Hawaii is in an awkward spot with these tax credits. The TV and film industry are forcing locales around the world to undercut each other in offering artificial enticements for them to make movies and television series in their community. We are being forced to give up most of the income we would receive if we were not forced to provide massive taxpayer subsidies to Hollywood.
But if we do not give concessions, they threaten to take their business elsewhere. Better a small injection of money into the local economy than none at all.
There is an argument that NO locales should offer any artificial enticements. What is it were left to an undistorted “free market” to determine where films and TV shows are shot? Under such a system, Hawaii would probably make out OK as we have unique attributes. Most movies shot here can be filmed in few other places. Yes, Kualoa Ranch has stood in for Africa, Central and South America and other places, but I suspect the convenience (and expense) of filming in Hawaii rather than Africa, South America, etc., would land us most of those films anyways, if all locations would stop trying to bribe the film companies.
Would the film Blue Crush been filmed on the North Shore without the millions of dollars of taxpayer dollars poured into its production? Probably not. But so what? Who can do a complete analysis of that film’s impact on Hawaii? How many young, almost penniless kids saw that film and were inspired to come Oahu’s North Shore? How much money did they bring with them?
But because Hollywood has succeeded, through their lobbyists, both national and local, to get local legislatures and city councils to offer up competitive bribes, we must deal with the reality of marginal, “Race to the Bottom” returns on film and television production. MAYBE a small injection of money is better than none at all. Or maybe, we should call their bluff and believe Hawaii is unique enough that we could make enough money without caving to Hollywood’s demands.I do not know the answer, but think we should have a discussion without our love for the glamour of movie stars distorting our judgment.
April 24th, 2012 at 11:16 am
Hollywood, thank goodness for Hollywood.