make WWAY your homepage  Become a fan on facebook  Follow us on twitter  Receive RSS Newsfeeds  MEMBERS: Register | Login

Do you think NC's tax incentives for film projects are good or bad for the state?

fudge the film industry!

They ought to throw out every one of them libber politickers that voted for this abomnation of a tax incentive, trying to lure them libber hollyweirdo libber film freaks over here to NC to make there dirty old movies, that aren't even GOOD, and they bend over backwards to please them out of town foreginer weirdo californian dingbat froot loops and give them them tax breaks that they wouldn't give to other companies in other professions to beg them to come shoot there discusting ignorant pictures here, they should be ashamed and pray to moohamad to forgive them lol :DDD

Rick Catlin's own numbers

According to Rick Catlin, the incentives “cost” the state of NC $33 million last year. Out of a $22 billion budget. That's 0.165%. Less than TWO TENTHS OF ONE PERCENT OF THE STATE’S BUDGET.

So whatever you paid in state taxes, multiply that by 0.165% and you'll get an approximate idea of what incentives might have cost you. For comparison, based on a 7% state tax rate, a person making $90,000.00 a year, barring any deductions, would have paid $6300.00 in state taxes. 0.165% of $6300.00 is $10.39. So if you made $90,000.00 last year and consider that you paid a proportionate amount of your taxes to the film incentive program, it would have cost you at a maximum $10.39.

Seems like very little to pay to keep thousands of jobs and millions of dollars in our regional economy. Additionally, crew, actors and local businesses all PAY NC taxes also.

And the marginal rate goes down to 5.8% across the board this year, so that $10.39 drops to $8.61 for a $90,000 wage earner. How many in NC make $90, 000 a year?

Just something to think about.

Ginger's own numbers.

Let's assume this hypothetical taxpayer earned that $90,000 working on films or shows that got the incentive. In that case, their $90k salary would have actually COST the state $22,500 ($90k X 25% incentive).

The point is that the film incentive does not ADD to scarce public coffers. It drains them.

If you want people to shell out $10 for a film subsidy, start a kickstarter campaign.

That's such a small amount I'm sure you won't object ....

Wow ! That's such as small amount, I'm sure you won't objecty to paying my share as well as your own. I'll donate the money I save to a real charity instead of a greedy film industry.

Amount film means to me...

I'm not a small business owner, just a lowly father of one in a household with only one income. In 2013 I worked with the "film industry" in multiple different projects that were in operation. The exact amount that I made from working there was $6286.00 pre-tax. This amount supplemented my base pre-tax salary of $46,284, which means I added over 13% of my base salary, over $500/month extra.

I see first hand how things work in the industry and rest assured that if we don't keep incentives the majority of filming will cease in NC. For me that results in a $500/month income loss and I am on the very low end. They will leave because they can save money elsewhere. As I said in a previous post, why pay more at Harris Teeter for the same product that's cheaper at Walmart? Our film employees will go where the work is and we will lose their income tax, property tax, sales tax on all their purchases, and lastly the businesses they used to shop at will experience some kind of loss.

Same theory as before 25% of 0 is always 0. Income earned is exponentially calculated when estimates of community impact are created for a reason. Nowadays Americans have a negative savings rate, we spend like crazy. If we don't have it to spend, it ripples across the state. The money generated from filming will get made up somewhere (higher property taxes, etc), do not doubt that for a second.

Please take a look at the bigger picture, it's very hard to see the forest for the trees sometimes...

If you like low wage jobs

If you like low wage jobs and an increased crime rate, than Wilmington, NC is the place to be. Time for manufacturing jobs to be brought back to the community. These are "real" jobs with way higher salaries, which support local businesses. Being an extra on the set of a film that produces for a few months is not long term growth. Film is a shot in the arm, but community leaders need to think long term. Screw the film industry, stop being pansies and bring solid jobs to NC.

Any of you folks read this info yet?

You should you know...$100,000 of "YOUR" tax dollars paid for it!!
A great tool to judge your City's leadership ;-)
Start with page #61 if you want to cut to the chase >>>>>>>>>

http://www.nhcgov.com/Documents/NHC%20CRR%20%283-31-14%29.pdf

Perhaps this explanation

Perhaps this explanation will clarify incentives:

You work your job and earn a paycheck. From your paycheck income taxes are deducted. The next year you file an income tax return. Your employer may have withheld too much money for income taxes, so you will receive a refund of the overage. Did you get money back? Yes, you did. Have you paid taxes? Yes, you have, just not as much as was believed you would owe.

Because some activities will benefit the economy and/or society as a whole, the government gives an incentive for people to engage in those activites. The incentive? A lower tax bill, thus a larger refund. (Maybe it will refund of all the taxes you paid, and more above that. Not likely, but some tax incentives can do that. A couple in Smithfield adopted six children and ended up with a $54,000 refund in 2011.) So you make your home more energy efficient, donate to charities, adopt a child, or any number of other activities, incentivized by a lower tax bill. Lowering your tax increased overall economic activity, and those activities generate other taxes.

North Carolina has tax incentives for filming here. Those workers pay income tax, and cause retail sales which generate sales tax, and retailers make investments that generate property tax, and hotel stays by out-of-towners generate occupancy tax, and so many others. The industry still pays taxes, just not as much because of the credits, so they get a refund. The state is not giving away other taxpayers' money. The state is not collecting as much from a particular film project. Even if the refund were to be more than the taxes paid, which I have never heard of happening, it is made up by other taxes generated from increased economic activity. Without the incentive the project does not exist, the additional economic activity does not happend, and the state collects zero additional taxes.

Should governments offer incentives to companies that make millions in net earnings from their customers? I don't think so. Can we get other states to stop offering incentives so we can stop? Not without a national law barring the practice, and even it that were to happen, other countries (Canada for one) will still offer incentives.

Free market economics says one does in their own best self-interest. Give me an incentive to conduct an activity in your area that I planned to do anyway, and I will take it because it is in my best self-interest. You should incentivize me because the overall increased economic activity offsets the incentive.

Red

I have several disagreements with your outlook.
First and foremost is this the increase of economic activity, prior to 2012 was driven NOT BY INCENTIVES but by natural beauty, a studio, and locally trained workers. That has not changed ! Recently industry magazines published articles listing the top 10 big,medium and small cities where filming takes place. On that list were MANY cities in states that did not have incentives. The fact that activity took place PRIOR to incentives and the lists showing continued activity without incentives COMPLETELY negates the film supporters arguments that removing incentives will cause the filming to stop. Incentives are NOT responsible for all filming done here now and quite frankly they may not be the reason for continued filming. All that the state can say is that since film incentives started (as of 2013) that in the first year a gross increase of 55 full time jobs took place. If we lose 55 jobs by letting incentives expire that is not so bad.

The second thing I disagree with is the LEVEL of increased economic activity that film supporters say is associated with the incentives, and with filming in general. They used IMPLAN multipliers in their analysis (the same IMPLAN the ballpark supporters used BTW). IMPLAN has been shown to be widely mis-used AND IMPLAN over estimates "related" economic activity. Here's a movie industry related link showing how this is so bad:
http://www.carolinajournal.com/daily_journal/display.html?id=10149

Film industry sponsored studies indicate the "multiplier affect" is up to 9 times the direct spending - this is unheard of in ANY industry never mind filming. But THEN we have other state auditors who counted ACTUAL taxes collected, from BOTH direct and indirect spending who are saying they are losing money. This COMPLETELY negates the argument that the "economic activity" (or multipliers) are accurate. The auditors for their part, are measuring actual results. The MPAA studies (or those sponsored by MPAA) are the ONLY studies saying film incentives are "profitable" for a state.
When our Legislative study showed that Handfields study was flawed I was NOT surprised. I was surprised by two things within the Legislative study. First I was surprised by the extensive analysis they did. They looked at generally reducing taxes, substitutive spending etc. It was very detailed.
The second thing was that they NOTIFIED Handfield BEFORE he released his study and he refused to respond. Now all we hear is that he "stands by" his study - offering no proof of his figures for accuracy.

I find this repugnant for a University official. I understand that ball stadium supporters here had no clue what IMPLAN was, or is and how it's mis-used - but I darned sure expected HIM to understand it.

There ar no, I repeat NO private studies (not related to MPAA) that support continuation of film incentives. That fact alone is disturbing - but when Auditors in many states show ACTUAL results? Then I say it's time to do away with this type of incentive program.
Vog

To be honest much of what

To be honest much of what brought work to NC in the good old days before there were incentives was that NC was a right to work state and most films that came here didn't pay benefits or wages similar to what they paid in unionized states. That combined with the presence of sound stages and a burgeoning work force were what got the film industry started here. Dino DeLaurentiis brought the studio to NC particularly because it was a right to work state and you could pauy people $5/hour instead of $25 and not pay any benefits. Now the film industry in NC is almost totally unionized so the benefit of lower wages is largely gone, although NC's rates are still below that of many other larger metropolitan areas.

The film incentives didn't start in 2012, that's just when they became nationally competitive. for years before that the incentives were at 15% and didn't include some of the things they include today, so work here was marginalized. For many years there was very little but Dawson's Creek or One Tree Hill and if you weren't lucky enough to get on one of those shows, you were working out of state.

So yes, the film incentives as legislated in 2012 had a HUGE impact on the amount of work that came here and continues to come here.

It's like being a host to the Olympics year round

The money comes in during the whole production, not just for 2 weeks and there is no cost to the city to build facilities to host the event, straight cash poured into the economy.

Bottom line equation

Film = higher taxes.

FILM = JOBS And just for a

FILM = JOBS

And just for a little affirmation on how important the incentives are...

https://www.dropbox.com/s/4fuj9h0iyq780tl/ASupplyChainStudy_3-31-14.pdf

Every dollar paid in wages

Every dollar paid in wages circulates 8 times before it leaves the local economy. This is any industry. Add to this the massive expendable purchases by film companies makes it wrong why? Other states have deeper cuts than we do and they are still coming here. What is this Rick Caitlin vendetta? He isn't bringing in any jobs for me to pay my mortgage. I'll still shop at Piggly Wiggly, I'll just do it in Georgia or Louisiana.

not only do films employ

not only do films employ local crew who their pay locally, they also help local small business by using them as vendors. everything from set building materials and props to wardrobe and food, all that stuff is purchased at local businesses. even renting locations and providing housing for executives and cast from out of state puts money into our local economy.

plus the money that production save from film incentives don't just go into some Hollywood big shots pocket, it gets funneled back into the production allowing companies to create a superior product, a product of North Carolina.

It is a huge win for everyone

Don't think of the Tax Incentive as losing money for the state and local government. The government still collects tax dollars, sales tax on all the business generated, local companies make more sales so they get more revenue, drives jobs which in turn drive more services, more sales and more tax dollars......

NC must be competitive with other states in order to win the business. Saying No to tax incentives will result in fewer jobs, less tax dollars generated, fewer sales.... NC should do everything possible to incent the film industry to do business in this state and especially in Wilmington. Anything less is a waste of local talent, resources, tourism dollars...... and there is always another state happy to step right up and collect those millions of dollars we give away. Don't be penny wise and pound foolish.

I agree that tourists are

I agree that tourists are attracted to areas they see in films. However, I think it is wrong for taxpayers to have to supplement an industry while small business people suffer. The film industry simply plays one community or country over another to get breaks and make more money.

If we are going to do that for one industry, let's give them all a break.

Re: "I agree that tourists are"

Small businesses do not suffer when the film industry is thriving. Ask the store owners of used furniture, car rentals, locally owned restaurants, home owners who profit financially from renting their homes, stores, land, etc for production. Talk to the families who benefit because their father is finally employed after a long haul of unemployment, barely scraping by, and now making enough to support their family for months to a year off of one feature film. Tourism is not the only positive economic affect that it has on NC, and that's most of NC, not just Wilmington. There's so much more that goes into it, and benefits this state. I would be more concerned with the tax payers' money that's being spent by the politicians trying to convince the minority that an industry this large and prosperous is somehow bad for them. It doesn't cause cancer, and it brings money into the state.

Better idea.......don't give

Better idea.......don't give breaks to any of them. Let them pay their fair share of taxes like we are expected to do or they come after us.

reply to Better idea...dont give

If you have read anything about the tax incentives, you should have noticed---that THEY do pay taxes, just like the rest of us do, they only have "incentives" to bring them to film in OUR state, which NEEDS what revenue and employment the film and TV industries bring to NC.....If NC gets rid of the tax incentives, dont worry, OTHER states will KEEP THEIRS, becaue they are smart enough to know how much their state will lose if they dont!!!!!

Many businesses would suffer without the film industry

"while small business people suffer" I would like to introduce you to a few small businesses that would suffer greatly without the film industry here. And there are at least 20 more that I am in the process of putting together. Give a listen. http://1045sunnyfm.com/common/page.php?id=1081

Sheila

How disingenuous of you to use your position at a radio station to augment your spokesperson position for Wilmywood.
While your anecdotal evidence is nice it bears no resemblance to fact regarding impact of filming for small businesses.
If filming wasn't incentivized these local stores would still benefit from filming because it wouldn't disappear !!! Also there beach tourism to boost local businesses.
does filming equal increased tourism? Hardly, and it's near impossible to measure. But the film industry would like you to believe that all tourism here is filming related just to make their argument for filming seem more "factual". It is not.
The arguments put forth by film supporters are nothing more than fear mongering at best.
Filming was here BEFORE incentives and will be here after.
Tourism was here before incentives and will be here after.

If a film depicts Conway SC like Christmas in Conway does - does THAT result in more tourism for Conway or Wilmington? If Ironman 3 (or 2) depicts a city in Florida does that mean more tourists for Florida?
How many people stay for film credits while at a movie theater? The majority still don't. (Hows THAT for anecdotal evidence?)
The Handfield report GUESSED at tourism impacts with no basis in fact and when question Handfield did not respond.
Film supporters have shown no, I repeat NO independent studies done outside the purview of MPAA to support their claims of economic benefit - yet state auditors that measured ACTUAL spending versus revenues have, and have found incentives to be much less effective, and not worth the investment.
I support filming and would be willing to lower corporate tax rates for film company's - but a pay out in excess of taxes paid is not the answer and never has been. This is not a function of government.

Vog

Incentives are not adding to tax payer's suffering

Um, tax payers do not supplement the industry nor are incentives the result of small business suffering. If those two things are your concern, you should be applauding every effort made to get more filming done in NC. Do you have any idea how much revenue is generated for small, medium and large businesses through the film industry? Any idea about how much tax dollars are generated? I encourage you to take and guess and then research it. I suspect you will be surprised. All a tax incentive means is that the industry is taxed at a lower rate than the 'standard' ridiculously high rate. Why give the government more money to misappropriate and waste? What does that buy small business?

You are correct about one thing, if the industry doesn't film in NC because the state is too dumb to offer effective incentives then they will film elsewhere and we lose out on the tax dollars that are generated from them doing business in our state. We lose out on all the local jobs, small business loses out on all sorts of service related revenue, government loses out on the corporate and sales tax....... You might want to consider taking a step back and rethinking your position.

Donna

You said:
" All a tax incentive means is that the industry is taxed at a lower rate than the 'standard' ridiculously high rate."
This ignorance shown in this statement is staggering and shows that film supports have completely lost their minds.
The incentive means no such thing. They are given a REBATE of 25% for EVERY DOLLAR spent this is not a reduction in taxes paid. Here's how this works - the state taxes at 5% of sales and payroll. The state pays out at 25% of spending. The film industry is profiting heavily off the backs of NC taxpayers.
I've got no problem with a new reduced corporate tax rate for filming - NONE. I've got NO PROBLEM with a rebate of actual taxes paid - BUT - when I ask film supporters if THEY support this, they refuse to answer.

Read the incentive package - its not based upon taxes paid, never has been. Its a rebate of monies spent.
The state taxes that spending at 5% but pays out incentives ON THAT VERY SAME SPENDING at 25%.

Then you said this:
"You are correct about one thing, if the industry doesn't film in NC because the state is too dumb to offer effective incentives then they will film elsewhere and we lose out on the tax dollars that are generated from them doing business in our state."
filming was here and growing before 2012 when incentives started but you associate ALL filming with incentives now. This is also brutally ignorant and disparages all of the reasons why filming was done here prior to incentives. IE the great, trained crews, the studio the scenic beauty - all were here before incentives. You have now completely trashed them all saying filing will go away should incentives stop. This has been proven wrong by the film industry's guide to the top 10 biggest/medium cities for filming list which happen to include many cities from states with no film incentives !! What attracts filming to them without incentives? Great crews, scenic beauty.
Sorry but your arguments for continuing incentives is full of holes and to say filming would go away if incentives stops has now been PROVEN totally false.
Stop drinking the kool-aid and try to answer my question regarding axes and or rebates of taxes paid.
HINT - film supporters hate this question because if we do lower tax rates then film company's lose out on the give away. If we rebate taxes paid only the same thing happens.
So answer the question.....

Vog

Film Incentives Benefit Small Businesses Directly

I've worked as a Producer's Assistant in Wilmington for the past 5 years here in town, and the first thing every production does upon arrival is pour money into the community. On the last feature I worked on alone (Spring '13) spent almost $50,000 locally in its first few weeks, hundred of thousands in the first months. Office supplies, tons of food-groceries and lunches from local restaurants (the companies feed us well), housing (for out of towners) - rentals all over town (On that particular production I would estimate we spent about $30,000 in the first month on rent locally (and everyone was here for about 3 more months), cleaning personnel (someone has to clean those rentals), hotels rooms, rental cars, gas, personal items/clothing, restaurants (for out of towners), copy machine rentals, costumes, tons of construction materials... I could go on and on. But the best part is all the paychecks the local crew gets, whose money goes straight back into the community- and we all shop local, and we all pay taxes.
Recent studies have shown that the state earns $9.00 for every $1.00 it gives back to a production company in incentives. Our industry is non polluting and positive for this state, and has kept food on the tables of mine and about 400 other families in just the Wilmington area alone. Local businesses win big with production.

No more incentives

Tax incentives of any kind, for anyone, create corruption elsewhere in the system. Tax revenues' have to be made up somewhere, someone is paying the expenses that taxes are intended to cover.

Why is the film industry so special that it gets incentives? Why doesn't my local small business qualify for special incentives? I create jobs, and pay salaries of local residents for the last decade.

EVERYONE should pay taxes at the same rate! Especially businesses. I challenge anyone to convince me otherwise. Is there is no logical, rational argument.

Well how about the fact that

Well how about the fact that every single time a production comes around here, small businesses that are also a part of the industry and are right here in town, make a killing off the production, which spends a large portion of its budget locally? And they employ local electricians, carpenters, security, students, actors--anything you name it. Film can be a great thing for any town big or small. If someone wanted to fuss about paying high taxes, fuss about the one of the highest gas taxes in the nation. Some of the lowest paid teachers. Those are issues. Film is not. Film=Jobs plain and simple.

Brannigan

You have fallen for the line. "Hook, line and sinker" so to speak.
Does filming equals jobs? Yes, and they are clean jobs too.
The problem is that state government should not prop up a private enterprise to keep those jobs here. That is NOT a function of state government.
Up until 2012 NC had a growing film business. It grew so well that a studio was put here. We have the facilities, the natural beauty that is NC, and the trained people to make it attractive to film company's from across the country.
We passed a film incentive in 2012 for what reason? Was Bev blackmailed? Or was it just a failed Democratic policy? Don't know.
And I don't care either. Why? I don't hate filming, far from it. I hate that we have to subsidize it.
If we return to 2011 production levels in this state IF incentives are let to "sunset" what happens? According to the first Legislative study in 2013 that looked back at the first year of incentives - only 55 jobs were created. OK - so we lose 55 jobs. The state would then "save" upwards of $77+ MILLION in incentives they would not have to pay out.
Here - lets think about my simple equation - again.
With incentives:
State taxes at 5% but pays out at 25%. Film company spends $100. State takes in $5 but pays out $25. It loses $20.

With NO INCENTIVES
State taxes at 5%.
Film company spends $100. State takes in $5 and pays out NOTHING.

The problem with this incentive is the way it's structured. It is based upon spending done, not taxes paid ! I have asked film supporters many times the following question and so far have gotten ------silence?
"Would you support a REBATE based upon taxes paid into NC - OR - a new corporate tax structure that reduces corporate tax rates for film company's and if not, why not?"
No one can, or is willing to answer - because the answer is the fact that they are greedy. They want YOU to be afraid of job losses. They want you to believe there will be NO FILMING in NC if incentives go away.
Don't be fooled by rhetoric from this lobbying group. They are entitlement grabbing hacks that bring their profits back to CA with them. They are playing us against other states like GA and SC - each of those states have their own issues. This is clearly a race to the bottom.
The rural legislators look at film incentives as incentives for those big counties like Mecklenburg, New Hanover and Buncombe who get huge influxes of tourists or have big businesses in them. They are NOT happy that Dems/liberals/Bev spent this money. I am registered as non-affiliated and have no political dog in this fight. To me it's just wasted monies.
The industry will be here with incentives or not.

Vog

Bloody Brilliant, Vog

Your post cleary and concisely confirms why film incentives are bad for North Carolina tax payers. Incentivising some (but not all) private business is not the role of government. Period. Reduce or eliminate our corporate tax structure and businesses of all industries will flock to NC. Just look at ND or TX for case studies.

People see who we are on screens countrywide,travel,spend here

You can't even measure the year round dollars brought by the tourists who come here just because of the movies and shows they watch that are filmed here. Being in the eastern US they can travel here by car, not like California where most on the Eastern seaboard have to fly to reach that location to see movie sets and run into movie stars .. many just walking around downtown Wilmington! In California, you don't see many stars just walking around, most stars are secluded in their gated mansions when not filming.