Hollywood tax credit on Governor Brown's desk

September 7, 2012 12:16:10 AM PDT
One of California's biggest industries, film making, is under scrutiny. The governor has to decide whether to extend a movie-making tax break, and not everyone thinks we're getting all that much bang for our buck.

To help keep movie and television production in California, the Legislature and former celebrity Governor Arnold Schwarzenegger gave Hollywood $500 million dollars in tax credits in 2009. Now Governor Brown has to weigh a proposal to give the industry $200 million dollars more.

"It's been a great investment for California," Teamsters Union spokesperson Barry Broad said.

A coalition representing the Teamsters Union and others in film says the first tax break has created 39,000 jobs and provided $325 million dollars in state and local tax revenue in the three years it's been in effect. In contrast, the Milken Institute says in the decade prior to the tax credit California lost 36,000 production jobs and $200 million in tax revenue.

Just last month, San Francisco was able to snag Woody Allen's new movie, "We want to keep it in California, and we're facing a lot of competition from other states and countries that provides similar kinds of incentives," Broad said.

But the state is broke. Critics think the money could be better spent on programs that have been drastically cut during this bad economy. A UCLA study found for every dollar the state gave in film credits, California got back $1.04, and it might be even less than that, according to the non-partisan Legislative Analyst Office.

"It seems like a little bit of misplaced priorities," Public Schools Budget Advisor Kevin Gordon said.

Educators say public schools could use the money. They can create jobs too by hiring more teachers or they could buy new textbooks.

"So while we're cutting public education to the bone, and we're making all these tough choices, and we're giving $200 million dollars to Hollywood for something that doesn't have a return, we can't afford that," Gordon said.

Supporters of extending the Hollywood tax breaks say the studies don't take into account the big picture, "There's a multiplier effect for each of these dollars, many more dollars are spent, but those are not always measured in these reports," Broad said.

The Governor must act on the proposal by the end of the month.


Load Comments