Louisiana film tax credits aren't paying their way, researchers find

In the past eight years, Louisiana's generous tax credits for filmmakers have helped lure to the state such productions as "The Curious Case of Benjamin Button," "The Expendables" and "Welcome to the Rileys," as well as the HBO series "Treme" and "True Blood."

This scene from 'The Curious Case of Benjamin Button' was filmed at the Newman Bandstand in Audubon Park.
Even though these productions and dozens of others have shown off Louisiana and provided jobs in front of the camera and behind the scenes, a new study concludes that tax credits in Louisiana and other states are a waste. The money lost through credits isn't made up, the study says, and the local jobs the film industry spins off are generally low-paying positions that don't build the economy.

Such credits, which cost states across the country a total of $1.5 billion in tax revenue last year, are "a wasteful, ineffective and unfair instrument of economic development," according to a report issued Wednesday by the Center on Budget and Policy Priorities, a nonprofit, nonpartisan research organization in Washington, D.C.

Not surprisingly, Sherri McConnell, director of the state Office of Entertainment Industry Development, disagreed with the report's conclusion.

Calling the film industry "a perfect fit for our state," she quickly ticked off its assets: It employs many citizens, it's environmentally friendly, it encompasses the entire state and it takes advantage of native talent.
According to McConnell's office, Louisiana has been the site for more than 300 projects since 2002, when the tax credits were enacted.

Sherri McConnell is director of the state Office of Entertainment Industry Development.
Louisiana's plan is among the nation's most generous, offering a 30 percent tax credit for investments of at least $300,000 in movies shot in the state. A labor tax credit provides a 5 percent tax credit based on the total payroll of Louisiana residents involved in a production.
For every dollar it gives in tax subsidies, Louisiana recoups only 13 cents, according to the study by Robert Tannenwald, a senior fellow at the center.

That number is obsolete, McConnell said, because it comes from a 2009 study her office conducted that relied on data for 2005 through 2007.
And, she said, it doesn't take into account the taxes that local governments collect.
"A lot has changed since then," she said.

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