Louisiana Film and TV Tax Credit Programs Near 2015 Revamp

State Senator J.P. Morrell, D-New Orleans (The Advocate staff photo by Mark Ballard)
State Senator J.P. Morrell, D-New Orleans (The Advocate staff photo by Mark Ballard)

NEW ORLEANS – The long Louisiana film and TV tax credit nightmare is nearing an end for 2015. The state legislature is moving-in on fixing most of the issues surrounding the hot topic debate of motion picture investor tax credits (MPITC) spearheaded by State Senator J.P. Morrell (D-New Orleans).

The real problem facing the MPITC program is not the industry, but rather the bureaucrats, legislators and left-wing nuts who continue droning on that these programs “cost Louisiana” money. To the willfully uneducated and obtuse population, this argument rings true, however is vapid at best.

The only stark issue which jumps out is Louisiana Republicans fighting against the MPITC and Louisiana Democrats fighting to keep the MPITC. Bizarro world.

The bill at greatest issue is HB829 sponsored by State Representative Joel C. Robideaux (R-District 45) who is – wait for it – a CPA by trade. This bill would place a cap on the MPITC program of $200 million, thereby Justin-Wilson-guaranteeing job losses.

The Bills – Film and TV Tax Credit

The current bills at issue which look good for the MPITC program and industry are sponsored by Sen. Morrell.

SB98 Requires sellers of motion picture investor tax credits to qualify for and be included in a Public Registry of Motion Picture Investor Tax Credit Brokers.

This is a provision which should have been written into the original laws and regulations. Good to see it finally getting sponsored.

SB100 Requires Louisiana Economic Development (LED) to engage independent auditors to prepare production expenditure verification reports for motion picture investor tax credits; sworn affidavits of those submitting information for the reports; regulates and limits expenditures between related parties and subjects them to review by the state inspector general.

This is a little catch-all bill which should really expand the budget of the Louisiana film office – Louisiana Entertainment – however, the MPITC program is moving in the right direction.

SB101 Requires the Louisiana Workforce Commission to provide information to LED and LDR to verify payroll and employment of Louisiana residents for purposes of the motion picture investor tax credit.

Once again, this is a provision which should have been written into the original laws and regulations.

SB102 Limits expenditures for ATL services eligible for motion picture investor tax credits to 50% of total production expenditures in the state.

This is what I call the Tom-Cruise-Rule. To the willfully uneducated bureaucrats who continue to argue Tom Cruise will come to Louisiana, film a $1 billion feature film and walk off with a $350 million paycheck because Cruise claims a $900 million paycheck. This is a stop-gap measure. A law written for ‘what ifs.’

SB103 Excludes certain expenditures as eligible for motion picture investor tax credits.

Once again (again), this is a provision which should have been written into the original laws and regulations. Louisiana should disallow such expenditures which are normal course of business expenses. This is a big issue with other private businesses which could not write-off expenses that the current MPITC allows. Think expenditures flying actors back and forth from London.

SB105 Authorizes the recapture of disallowed tax credits from owners of entities created or organized for the primary purpose of receiving or selling motion picture investor tax credits.

As I read this bill, it will effectively end tax credit brokers. I would never go into the business of brokering tax credits if I was personally liable for the actions of criminals. Maybe there is some insurance coverage available for due diligence efforts.

SB106 Requires recovery of motion picture investor tax credits issued in violation of the tax credit law or its administrative interpretation and those issued to an investor convicted of a criminal violation related to such tax credits.

Once again (again, again), this is a provision which should have been written into the original laws and regulations.

This is what I call the anti-LIFT bill where federally convicted criminals will actually get to keep their tax credits. All $6.5 million of them.

Wait until convicted federal criminals start to produce new film and TV shows and apply for MPITC. Did the legislature think of that? That will be a circus.

Twitterville

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At the End of the Day

The biggest issue Louisiana must face is the creation of jobs, of which the state would not, as a normal course of business, have created. For some unknown reason, this state has the ability to snatch defeat from the jaws of victory when it comes to job creation.

The film and television industry has created over 15,000 jobs depending on your data-source-du-jour, and these are well-paying jobs.

Do we want to be known as the BP Oil Spill state? Or, the Katrina State?

Or, do we want to be known as a major hub for film and television production?

Submitted for your consideration,
Stanley B. Gill
Founder and Editor-in-Chief
The HollywoodSouth Blog

The New Orleans Advocate: Package of bills to revamp Louisiana film tax credit program nears final OK

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