Back from a short trip to California to promote the generous subsidies Louisiana offers to film and TV productions, Gov. John Bel Edwards says he expects the movie-making industry to continue to grow here.
“The message that I received loud and clear out there is that they really like Louisiana — they like doing business here and they have renewed confidence in the stability of the motion picture tax credit,” Edwards said Wednesday upon his return in New Orleans.
Edwards spent two days in California meeting with executives from major Hollywood studios, including Netflix, Warner Brothers, NBC Universal, Walt Disney Studios, HBO, Hulu, CBS and Sony. Edwards said the outlook is optimistic, though he didn’t bring back announcements of any major new projects.
Edwards, a Democrat who is up for re-election next year, said changes that the Legislature made to the state tax credit program in 2017 helped launch a resurgence in filming in Louisiana. Lawmakers capped at $150 million the amount in credit certificates the state can issue in a year to roughly match an existing cap on annual payouts at $180 million.
Under 2017 legislation, which was supported by the industry, allows film producers to recoup up to 40 percent of their costs – subject to various restrictions – in the form of transferable tax credits. The 2017 changes sought to encourage a more permanent local film industry, adding new incentives for Louisiana jobs, productions that originate in Louisiana and independent films.
Edwards said the revamp has led to a 200 percent increase in independent film activity in Louisiana.
“My best guess is over the coming months and weeks we’re going to be even busier in Louisiana,” Edwards said. “The program is stable and it’s very much to their liking.
“It’s not the most lucrative in the country, but they like being in Louisiana,” he added.
Edwards has been a vocal supporter of growing Louisiana’s film industry since taking office in 2016. He was the keynote speaker at the state’s first Entertainment Summit, whose purpose was primarily to promote the film-subsidy program.
Critics of the state’s film incentive program have long questioned the value to the state. Economic studies, commissioned by the state every two years, have estimated that the program generates 20 to 25 cents in state revenue for every $1 awarded in credits. Film boosters have grumbled that the studies are unfair.
The state expects this spring to release the latest economic-impact analysis of the film program, and they expect this one will be more positive.
This one will show what has changed since the 2017 revamp, said Revenue Secretary Kimberly Robinson, who accompanied Edwards on this week’s trip. She expects it will show that each $1 in incentives generates $5 in “economic activity” in the state.
Critics also have pointed to a long-standing trend of states courting movie and television productions with more lucrative incentives, leading to a “race to the bottom” where states underwrite a huge portion of costs. But Edwards said he thinks that the growth in the industry, through streaming services and other sources, has made that less of a problem for Louisiana.
“While there is sort of a friendly competition, the fact of the matter is the pie is big enough that we can slice off a really good piece for Louisiana and not negatively impact Georgia,” he said.