By John Keenan and Brian Wallace
Saturday, March 21, 2009
Boston Herald, Op-Ed
With a multibillion dollar budget deficit looming and unemployment at 7.8 percent and rising, Massachusetts is desperately seeking growth industries. Fortunately, we have one in our own back yard that has generated $545 million in direct new spending over the past three years. Biotech? Green energy? Try again – it’s film.
In late 2005, Gov. Mitt Romney signed into law the Massachusetts Film Tax Credit (FTC), a production incentive that made Massachusetts competitive enough to draw producers who had previously confined their filming to the New York-California circuit.
In 2007, Gov. Deval Patrick and the Legislature improved the dynamic by extending the tax credit’s expiration date, lifting the credit cap for larger features, and modifying it to include more independent films and digital media productions.
Today, we’re benefiting from the results with more than 25 major motion pictures, films and TV projects produced in state since 2006, and the number of people employed in the Massachusetts film industry growing by 11 percent in the same period.
With film attendance up this year, developing Massachusetts’ motion picture, TV and digital media industry is a hedge against the recession and a good investment. According to figures released last spring by the state Department of Revenue (DOR), the cost of the film tax credit is only 14 cents for each new dollar generated in the state’s economy by the film industry. DOR also estimated that the credit could bring in more than 5,000 new jobs with annual salaries of between $40,000 and $70,000.
DOR’s figures are even more impressive because they did not include local taxes, fees and business generated for cities and towns during production, such as the $150,000 that Essex will reap in property use and parking fees from an upcoming Adam Sandler movie.
DOR’s figures also don’t include promotion and tourism dollars generated by local motion picture projects. How many of your out-of-town guests demanded to visit the L Street Tavern after “Good Will Hunting” came out? Finally, DOR’s projections did not include the half-billion dollars of new private investment likely to be generated by the construction and operation of several new proposed sound stages. In short, the benefits to the local economy far outweigh the costs.
“Hollywood East” isn’t just a clever sales pitch. It means getting our fair share of a $60 billion industry that every year enjoys a balance of trade surplus of $10 billion – even in bad economic times. It means creating private sector jobs with private sector pension and health care benefits at a cost of pennies on the dollar.
And it means desperately needed revenue for cities and towns. In addition to Boston, communities as diverse as Salem, Andover, Burlington, Gloucester, Haverhill, Hull, Lawrence, Lenox, Lowell, Medfield, Plymouth, Rockport, Taunton, Woburn and Worcester have benefited directly from spending generated by the Film Tax Credit.
The Bay State’s success has even riled California Gov. Arnold Schwarzenegger, who – despite the traditional allure of Hollywood – publicly fretted last year that Massachusetts is luring away tens of thousand of jobs.
Because of this incentive, and the new economic activity it has already generated, Massachusetts is well on its way to becoming the Northeast regional center for film, television and digital media. The question, therefore – especially now – is not whether we can afford the film tax credit. The question is, can we afford to lose the jobs and revenue the film tax credit has brought to Massachusetts.
Rep. John Keenan (D-Salem) is chairman of the Joint Committee on Tourism, Arts and Cultural Development. Rep. Brian Wallace (D-South Boston) is one of the original authors of the tax credit legislation.
Article URL: http://www.bostonherald.com/news/opinion/op_ed/view.bg?articleid=1160085