Pros and cons of the Louisiana Purchase

October 18, 2016
Louisiana Purchase (1803)…

The film Black and White, shot locally, premiered at the New Orleans Film Festival in October.This is the first in a two-part series. Part 2 will appear in next week's Gambit.

At the opening night of the New Orleans Film Festival in October, merriment prevailed inside the Civic Theatre in downtown New Orleans. On hand for the U.S. premiere of the locally-shot Black and White, local actors, producers, technicians and cinephiles celebrated another entry in the annals of "Hollywood South, " the industry built since former Gov. Mike Foster signed the state's film tax incentive program into law in 2002. As New Orleans Film Society Executive Director Jolene Pinder introduced the film, she noted a statistic borne out by the crews populating city streets, plantation houses and sleepy bayous from here to Shreveport.

Hollywood South is "the No. 1 hub for film production, " Pinder said. The crowd went wild.

In 2012, according to a study prepared for the state-run pro-business group Louisiana Economic Development, film and television production generated more than $1 billion in sales at businesses in Louisiana, along with $718 million in household earnings from 14, 000 jobs.

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  • The film Black and White, shot locally, premiered at the New Orleans Film Festival in October.

As in silver screen fairy tales, however, the rags-to-riches narrative of Hollywood South bears only partial resemblance to a more complicated reality. In order to win the competition for "runaway productions" — the industry term for films and television series fleeing the high costs of Hollywood — Louisiana's tax incentives have transformed from an inducement into a necessity. To eliminate, reduce or cap the credits would risk a precipitous decline in local production, but offering a permanent tax break of more than 30 percent to one of the world's most lucrative creative businesses is questionable at a time when Louisiana's budget crises are forcing deep cuts elsewhere.

Though analysts, public officials and industry figures may disagree as to the budgetary and overall economic consequences of the tax incentives, most agree the continued success of Louisiana film and television production depends on the credits themselves — for better and, perhaps, for worse.

State legislatures across the country are debating the value of similar programs, asking if an industry so heavily subsidized by taxpayer monies can be considered "independent" and "self-supporting" — particularly if tax incentives, which originally were intended to "sunset" once the industry was established, become extended into perpetuity.

In the 1990s, when films and television series such as The Big Easy, JFK, Orleans and Primary Colors set up production locally, observers predicted boom years ahead. In one local news segment, excerpted in a commemorative documentary on "The New LA Filmmakers" produced for the New Orleans Film Festival, those interviewed predicted that the year 2000 would see Louisiana rank with New York and Los Angeles as a production capital.

"[O]ne way or the other, the demand for movies, whatever form they take, will likely still be around, " the correspondent ventured. "And Louisiana has a good chance to be center screen and up close when the call for action rings out."

By the millennium's turn, however, these dreams of grandeur proved premature. As Canada's favorable exchange rate and production incentives drew the industry away from the United States, the amount of direct spending on film and television in New Orleans declined by more than 50 percent between 1996 and 1999. The lesson was clear.

"Hollywood has no loyalty, " says Todd Lewis, a producer on Black and White and a production manager on The Fantastic Four, filmed in Baton Rouge and slated for release next year. "They're going to go wherever the best deal is."

"Ten years ago there was really no motion picture production in the state of Louisiana, Now we're talking about film as a major part of our economic DNA." Chris Stelly, executive director of Louisiana Entertainment

In 2002, then-State Sen. Jay Dardenne (now lieutenant governor) and former State Rep. Bryant Hammett sponsored the legislation that inaugurated the current tax incentive program. In its first iteration, the law provided a sales tax exemption to productions with budgets exceeding $250, 000; a 10 to 20 percent tax credit on local wages; and a 10 to 15 percent tax credit to investors. (The lower rates applied to productions with costs between $300, 000 and $1 million, while the higher rates applied to productions with costs higher than $1 million.)

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