Wednesday, August 15, 2018
Politics

Florida film industry's future in the balance as state tax credits dry up

TALLAHASSEE

When Live by Night opens in movie theaters in 2017, viewers will be treated to the sights and sounds of Ybor City in the middle of Prohibition.

Only they won't be looking at the Tampa area.

The Ben Affleck movie, based on a Dennis Lehane crime novel by the same name, is being filmed in Georgia, where generous tax credits lure filmmakers and TV series production companies. The Live by Night crew is building a replica of Ybor City.

Dozens of projects have backed out of Florida after looking to film here, including Million Dollar Arm, Magic Mike XXL and 42, the story of Jackie Robinson. All told, the state has lost out on more than $650 million in economic activity from TV shows and movie projects since 2013, according to industry group Film Florida. It's all because the state tax incentive program is broke.

All $296 million set aside by the Legislature in 2010 for entertainment industry tax credits through 2016 was used up two years ago. The program, created in 2004 to provide rebates to approved films, TV shows and other projects, is set to end next July unless lawmakers act.

It's been the subject of criticism from all sides, and Sen. Nancy Detert, R-Venice, says any hope for continuing state support will have to involve massive reform.

"The criticism has continued through the years to the point that your program is now killed," Detert told state Film Commissioner Niki Welge in a Senate hearing last week. "It's dead. You have zero for this year, zero for last year, zero for the year before."

Opponents say the program hasn't spurred enough economic growth. Even the Department of Economic Opportunity, which houses the film commissioner's office, isn't asking the Legislature to extend the film incentives.

"If the Legislature were to come through for the film and entertainment industry, it's important that it would have a lasting positive effect on job growth and return on investment for the state," Welge told senators.

The entertainment industry has been Detert's pet project for years and this is her last chance to reform incentives. She's stepping down from the Senate after the 2016 legislative session.

Last year, she led a failed effort to reorganize the entire state Office of Film and Entertainment and re-imagine the tax incentive program.

Her new proposal won't be available until this week, but she said it will be very different from the current incentives. Central to the changes will be giving more power to the film commissioner to select projects likely to have the greatest impact on the state's economy and getting rid of the first-come, first-serve system.

"We are not getting the most value for our incentive money," Detert said. "So I am in favor of doing away with incentives and coming up with more grant money."

Initial funding would come from $196 million that was promised to entertainment projects that have not come to fruition. She also wants to move the state film office to Enterprise Florida, where Detert hopes the film commissioner can be more aggressive in attracting entertainment jobs to the state.

But she is likely to face opposition from a faction in the House and Senate that considers tax credits to be "corporate welfare," and from Gov. Rick Scott. The governor's proposed budget for next year included no money for film incentives, despite huge investments in economic development as a whole.

Asked about it Monday, Scott said, "I look forward to continuing to work with the Legislature on that. I'm in favor of incentives as long as we get a great return for taxpayers. My focus is always focused on do we get a return for our taxpayers?"

An analysis in January by the Legislature's economists found that the film tax credits don't bring in enough money to offset the cost of the program.

Industry supporters, however, say that analysis doesn't paint a complete picture of the impact and contend such programs are critical as other states ramp up their tax credits to lure businesses from Florida.

Michelle Hillery, president of Film Florida, said she fields calls every day from professionals in the film industry who feel that the state is abandoning them.

"They feel that there is this true sense of desertion of their jobs, and it's hurting a lot of people who have counted on the state and are now having to leave," she said, adding that she has "concerns that this governor may become known as the only Florida governor in its history to not support film and television and digital media."

Industry groups are countering with their own proposals, which they believe will be more attractive to critics than past ideas floated by the Legislature.

Film Florida has a plan that would include smaller incentives such as a cash rebate, capped at $4 million per project.

It's "the most conservative rebate program in the entire United States," Hillery said.

The Congress of Motion Picture Associations of Florida (COMPASS) is pushing a more aggressive idea.

"One of the key things is a replenishing provision," COMPASS chair Chris Ranung said. "Some way the state can see that they won't be tied to a program for long before it will be self-sufficient."

His group wants to see a loan program to attract high-value TV series, which stay longer to film and have more impact on the economy. They're also proposing allowing the state to invest in projects and earn a share of the earnings, like an executive producer.

Detert isn't convinced.

"They don't need to do my work for me," she said. "We have people for that. I'm happy to hear their opinions, but I don't think they need to work that hard to be that creative."

Detert believes the governor and critics in the Legislature will be on board with her new plan.

"The governor's office we can work with," she said. "And the House's criticism is mainly based on criticism of current law. Current law is terrible. Current law is what I'm trying to reform."

Contact Michael Auslen at [email protected] Follow @MichaelAuslen.

 
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