State legislators, film industry pros, and representatives from the actors’ unions converged at the Connecticut State Capitol to rally for an expansion of the state’s film tax credit program.
Leading the charge was Jonathan Black, a long-time film producer, and partner (with his wife Lauren Black) of Chair 10 Productions. Over the course of Wednesday’s press conference, Black argued that Connecticut should be looking to broaden the state’s film tax credit incentives as a means of competing with surrounding states.
“It is important to look at the comparisons that we’re losing business, to New Jersey, for example,” he said. “We’re losing business to Georgia or Canada or even Prague if you would. The important part of that is that I’m looking at it from an economic standpoint. How much money can we bring back to the state?”
To Black, increasing production in Connecticut is the key to building a robust production infrastructure in the state. A study of productions utilizing the state’s tax credit program did find that the majority of productions would not have happened here without the incentives offered by that program.
Black’s plan would expand the existing tax credit in a few ways. First, it would offer additional credits, on top of the 30% tax credit for productions of at least $1 million for things like hiring a certain percentage of crew members from a local talent pool, hiring a percentage of minority workers, or choosing to produce the project in an economically developing city or town. A production taking advantage of every bonus could get up to a 37% tax credit.
Additionally, Black would expand the transferability of the tax credits to additional industries and businesses, making it easier for producers to sell the credits if they exceed the film’s tax liability.
Black has the support of at least two lawmakers, including Rep. Joseph Gresko (D-Stratford), who arranged the press conference, and Rep. Kadeem Roberts (D-Norwalk). Both spoke during the event in favor of the proposal and said they would be supporting an expansion of the tax credit program.
“Finances in the state of Connecticut are different now than they were back in 2006 and even in 2011, and through much hard work by my colleagues over the years, we are in a better position,” said Gresko. “So, now we can be in a better negotiating position to entertain the idea of bringing these tax credits back to the state of Connecticut and recalling all of these individuals who travel across the country for the best deal.”
Connecticut’s film tax credit program has not always been an obvious boon to the average resident. In fact, film tax credits have come under fire across the board in recent years, with critics viewing the incentives as a race to the bottom as states try to outbid each other to entice larger productions.
The benefit to producers, production companies, and those in the industry is obvious, but benefits to states has been difficult to quantify, since a large amount of the expenditures claimed tend to be salaries for high-level positions and talent.
When asked, Black admitted that it will be difficult to guarantee that productions will hire a majority Connecticut residents to fill positions on the crew but said that anyone working on a production in the state is still required to pay taxes here. He also argued that increasing the number of productions – especially television series, which have much longer production schedules than feature films – would entice more crew members to move to, or remain in, Connecticut with the promise of steady work.
The fact that the tax credits are transferrable has also raised questions. A report from the state auditor’s office showed that the real beneficiaries of these credits tend to be the state’s insurance companies, who buy the credits from productions to offset their own tax liability.
