Red, Blue States Boost Entertainment Industry Giveaways

Zachary Halaschak of the Washington Examiner documents disappointing bipartisan support for a bad idea: state film and television incentives.

States, even those not traditionally associated with Hollywood, have been pushing incentives to lure in film and TV production business as the pandemic wanes.

States such as Montana, Kentucky, Oklahoma, Oregon, and even California have recently made overtures to draw production into their states as the industry starts to heat back up again after COVID-19 disrupted the 2020 plans of many studios.

Vans Stevenson, the senior vice president of state government affairs at the Motion Picture Association, told the Washington Examiner states that are increasing financial incentives for TV and film productions to come to town have two goals in mind: to create jobs and to grow an attractive economic development program. …

… Not everyone is a fan of state incentives for film production, though. Joel Griffith, a research fellow at the conservative Heritage Foundation, told the Washington Examiner that when states provide the incentives, taxpayer funds that could either be put toward the budget or lowering taxes are stripped away.

“Politicians love getting the credit for these jobs, but they know that most people aren’t going to recognize the cost,” he said, later pointing out that both Republican and Democratic lawmakers have a hand in offering production incentives.

He said that some studies have shown that the economic return on providing these benefits is less than anticipated. A 2018 survey of studies found that movie production incentives have an average return on investment of 27 cents per dollar of tax credit issued.

Griffith said what the states should be focused on is lowering the overall tax rate for all businesses, which he said would generate more robust economic growth. “Don’t get lost in these giveaways to specific industries,” he said.

But despite detractors of government production incentives, the TV and film industry and many states see the future for production across the country as promising.