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Re: “Georgia's blank check to Hollywood

I do not deny the economic activity from film spending. Clearly, if a $100 million movie comes to town, then it spends that huge amount of money at lots of places and hires lots of people. And all of that is great. Not so great, however, is the fact that you had to give up (fine, not spend) $30 million in tax revenue that you would have otherwise collected.

And since the $30 million in tax credits, which the production converts to cash by selling them, is used to pay for the cost of the film, that really means that of the $100 million spent, roughly $30 million was already the state's money.

Some would say, "so what. we still had $70 million in impact". True. But in order for the program to pay for itself (much less make money), that $70 million in private economy spending would need to generate $30 million in new taxes. And that is mathematically impossible.

Louisiana has a 30% rate. Unlike Georgia, they have commissioned no less than five economic impact studies. All of the reports (which look at direct spending AND indirect impacts) show the state only recoups about 18-cents for each $1 credit paid out. Louisiana sees it as an investment. They KNOW they lose money on this. But they are ok with that. Georgia film backers should take the same approach.

Jobs Yes. Spending Yes. Making money for taxpayers NO.

7 likes, 2 dislikes
Posted by Adrian H. McDonald on 07/19/2013 at 4:07 PM

Re: “Georgia's blank check to Hollywood

You are neglecting the economic activity that results from the productions that come to the state...and even with your dour angle on it, the state does not expend resources. They are foregoing a portion of as yet uncollected monies...all with a purpose in mind, to attract new business that brings a host of benefits.

All of these criticisms hinge on the twisted view that not collecting a buck means that you spent a buck...and that the three bucks spent by the guy, from whom you didn't collect it, doesn't count.

Since the state has posted a big surplus in tax revenues recently, it's obvious that this program isn't hurting the state. Surely you can admit that, even if you won't recognize the benefit.

1 like, 3 dislikes
Posted by oydave on 07/19/2013 at 3:57 PM

Re: “Georgia's blank check to Hollywood

The 70% of something is better than 100% of nothing logic sounds great, but it's fundamentally flawed.

Many people think that a production company that goes, for example, to Georgia to make a film is getting a reduction on its taxes of 30%. To the misinformed film backer, the state is still getting the other 70% of the new company’s taxes that would not have come to Georgia in the absence of the film incentive. If this were actually how the film incentive worked, the “70% of something is better than 100% of nothing” talking point would have merit. But this is NOT how film incentives work. Film incentives represent cash, directly (from refundable tax credits) or indirectly (from transferable tax credits) that production companies use to finance their project.

So when $200 million in tax credits are purchased by wealthy Georgians or resident corporations, they use the credits to satisfy their taxes rather than sending actual money. Result: Georgia is OUT $200 million in revenue that it would have collected but for the film subsidy. This is a huge cost.

5 likes, 1 dislike
Posted by Adrian H. McDonald on 07/19/2013 at 3:38 PM

Re: “Georgia's blank check to Hollywood

"Seriously? "the KIA deal has nothing do with the tax credit" No shit. Who said it did?"

"It's not just a matter of cutting checks to film production companies. We (GA) gave away our soul for Kia and also PAID for infrastructure"

YOU said it.

" I didn't even have waste my time reading any further with that statement nor will I."

All your base are belong to us....

Posted by oydave on 07/19/2013 at 3:23 PM

Re: “Georgia's blank check to Hollywood

Seriously? "the KIA deal has nothing do with the tax credit"

No shit. Who said it did? That was the final nail for me with that sentence that you are either more uninformed than I thought or worse.... I didn't even have waste my time reading any further with that statement nor will I.

Reread my statements until you understand them.

Posted by Albert Maguffin on 07/19/2013 at 2:56 PM

Re: “Georgia's blank check to Hollywood

"Good FOR my state"...it should say.

0 likes, 1 dislike
Posted by oydave on 07/19/2013 at 1:12 PM

Re: “Georgia's blank check to Hollywood

As someone who works in the business, and has been here before the tax incentive, I promise you, this business is bigger than anyone can grasp. Thousands of people have jobs. Thousands of local vendors are benefiting (dozens that RELY on this industry.) In my department alone (with one of the smaller budgets in a production,) I am spending a minimum of 1 million dollars, with about 60% of that going to LOCAL labor. In three months. IN ONE SHOW. The show that I am on now is about 15 times bigger than the ones before. That is over $10 million dollars in local wages, on ONE show. We can sit here and argue economics all day, but I will take 70% over NOTHING. These out of state people that come in pay taxes and spend money the ENTIRE time they are here. From tourist attractions, to housing, to meals three times a day. Who cares if these million dollar companies are getting a tax break? I can give you thousands of names of people who are benefiting also! And PLEASE remember, the current deficit and issues with this state have nothing to do with the fact that we are making Georgia more appealing. It is only going to help this state. Every show I have worked on, and spoken to out of town people in this business all say the same thing....they've seen incentives before, but it has never been done right, and Georgia is on it's way to doing it right! We NEED this business to stay.

2 likes, 1 dislike
Posted by CLC on 07/19/2013 at 1:08 PM

Re: “Georgia's blank check to Hollywood

"Once again you demonstrate your lack of understanding"

No, I demonstrate my penetrating insight to the fact that you have no idea what you're talking about. The Kia deal has absolutely nothing to do with the film production tax credit. Every one of these programs is different and separate from the other. It is true that the state has spent money to persuade these heavy industries to locate here. The merits or demerits of that has nothing to do with the subject at hand. The plain fact of the matter is that the film program costs the state nothing and attracts many high paying jobs, business for merchants and the intangibles of prestige. The fact is that you were talking out your ass about something you have no clue about so you deflected to some BS about something else.

I am on no crusade. I just like to correct ridiculous sniping by wanky, knee jerk, know nothings regarding something close to me and good my state...sweet, merciful, bountiful, beautiful Georgia. You anti-business, anti-capitalist types are the ones on a "childish ego driven crusade."

2 likes, 2 dislikes
Posted by oydave on 07/19/2013 at 11:13 AM

Re: “Georgia's blank check to Hollywood

Once again you demonstrate your lack of understanding. It's not just a matter of cutting checks to film production companies. We (GA) gave away our soul for Kia and also PAID for infrastructure... for a company that sits near AL (great for KIA to have access to their sister Hyundai plant in AL) which means WE paid for at least some Alabama resident to have jobs on top of everything else in a state and region whose creed is small guv'ment at all costs and free market at all costs.

Yet they practice big guv'ment and socialism.

None of this matters, you just want Atlanta mentioned next to LA no matter the cost or context of it all... and at the end of the day, that's not going to happen. We've seen this with other cities as well. But by all means go on with your childish ego driven crusade....

3 likes, 2 dislikes
Posted by Albert Maguffin on 07/19/2013 at 10:38 AM

Re: “Georgia's blank check to Hollywood

Please detail to whom and for how much the state has written checks in this film production tax credit program...also, if you have this information, why didn't you post it in one of your two posts already?

2 likes, 1 dislike
Posted by oydave on 07/17/2013 at 8:37 PM

Re: “Georgia's blank check to Hollywood

Go to school indeed if you don't believe that the state spends money at all.
Seriously? How naive are you?

2 likes, 0 dislikes
Posted by Albert Maguffin on 07/17/2013 at 4:23 PM

Re: “Georgia's blank check to Hollywood

The question, of course, boils down to an exciting and lucrative new industry or nothing at all-- for better or worse this is the culture and business of film production today-- and as pointed out above 70% of something (lately a lot) beats 100% of nothing. While not all tax breaks make sense, the Ga Film tax incentive in this case has created a whole industry where the was next to nothing-- seems like a pretty good deal to me--

Posted by vx on 07/17/2013 at 8:18 AM

Re: “Georgia's blank check to Hollywood

Maguffin...clever.

"it's the businesses, that are benefiting the tax credit. By publicity. Second, Although the State of GA seems to be increasing; where are the funds coming from? I mean, offering $75million tax breaks for film!? seriously? While our schools are closing because of funds."

Not deserving of a response due to no detectable cranial activity...BUT...here goes, anyway...

For the millionth time, the state is not spending any money, not spending any money, NOT SPENDING ANY MONEY! Go to school, understand the subject and then try again. To reiterate from the guy above, who DOES understand it, 70% of something is more than 100% of nothing.

Tangentially, to play your ignorant game, what is wrong with businesses benefiting? What happens when businesses benefit? Workers get a paycheck and the business and the workers pay taxes so the state can fund your precious schools, which aren't closing due to lack of funds, by the way.

I am not optimistic that any of this is getting through...judging from the syntax, the grammar and the total ignorance of basic economics.

2 likes, 2 dislikes
Posted by oydave on 07/16/2013 at 6:06 PM

Re: “Georgia's blank check to Hollywood

Ok. Is it me, or is there a serious problem here? First off, it's the businesses, that are benefiting the tax credit. By publicity. Second, Although the State of GA seems to be increasing; where are the funds coming from? I mean, offering $75million tax breaks for film!? seriously? While our schools are closing because of funds. This just doesn't make any sense to me at all. And last, Offering a tax credit to the film industries is only affecting us "the average GA citizen that tries to make a $1 out of 0.15 cents" You figure it out...

2 likes, 0 dislikes
Posted by Niki12) on 07/16/2013 at 3:59 PM

Re: “Georgia's blank check to Hollywood

sodisappointed you joined just to criticize this article with blind boosterism...?

2 likes, 0 dislikes
Posted by Albert Maguffin on 07/16/2013 at 3:47 PM

Re: “Georgia's blank check to Hollywood

That's some pretty dense nonsense.

WTF does having a film festival that meets your artsy requirements have to do with producing films? And how is Pinewood Studios, one of the most prestigious movie production outfits investing millions in a facility at all transitory or "opportunistic, quick buck" in nature? Google Pinewood Studios and then tell me it's a "bottom feeder."

Again, for you deep thinkers who have trouble thinking, the state is not laying out a single dollar for this activity. It is giving up a share of monies that it would not have collected anyway if the business had gone to another state. It is impossible to lose on this deal. Why is that so hard to understand?

11 likes, 1 dislike
Posted by oydave on 07/14/2013 at 9:31 AM

Re: “Georgia's blank check to Hollywood

It's funny that there's such a boosterish response to an obviously skeptical article--very Atlanta. Tax breaks tend to attract low end, non-value added businesses in all sectors. The non-transparency from the state should be the first clue that this is not working out as well as anyone would guess. A libertarian economist questioning the whole business should be another. The media business is cyclical and probably provides sustained employment for a relatively small number of people. Georgia is competing with other bottom feeding states, not with Hollywood or New York, and probably not with Toronto or Vancouver which can mimic more kinds of places and have deeper creative sectors. Gay marriage will make it easy for all the bottom feeding states to be boycotted and for Canada (where there are actual medical benefits) to reap the benefits.

Atlanta is an odd place in that it long has had a large number of serious film fans, but has never grown a first rate film festival. The outfit that curates a number of local festivals purposely seeks out future cable and Landmark Cinema fare rather than playing to audience strength. That's not the kind of community that can hold onto creative types. The notion that an opportunistic, quick buck (i.e., stereotypical Atlanta) approach to film making will result in something more than a string of Tyler Perry vehicles is the kind of thinking that makes it easy to shake one's head at the talk from boosters.

3 likes, 4 dislikes
Posted by Rich Jenkins on 07/14/2013 at 8:57 AM

Re: “Georgia's blank check to Hollywood

Great Article. Well done.

It is remarkable how quickly the industry has exploded here.

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Posted by Atlately on 07/12/2013 at 9:40 PM

Re: “Georgia's blank check to Hollywood

It's a no brainer, of course it's been a huge success. Ask anyone who has benefited from it!

1 like, 0 dislikes
Posted by Stephen Crocker on 07/12/2013 at 8:53 PM

Re: “Georgia's blank check to Hollywood

"There is nearly no mathematical way that the state can make back the 30% or the $300 they paid for one person to have a $1,000 paying job."

You are the one not getting it. The state didn't "pay" anything to anyone. They do not write a check to anyone or spend any money, they forgo tax revenue that they WOULDN'T HAVE COLLECTED IN THE FIRST PLACE. If even a dime flows back to the state, they come out ahead. Also, meanwhile, people have work, merchants sell stuff, hotels book rooms.

In order for what you are saying, nevergonnagetit, to make sense, you have to believe that all money belongs to the government and they don't collect taxes, they disburse people's share of the government's money.

5 likes, 4 dislikes
Posted by oydave on 07/12/2013 at 5:43 PM

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