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As other states eye cuts to movie subsidies, one defense of the Massachusetts program

Posted by Alan Wirzbicki  January 20, 2011 12:41 PM

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Earlier this month, a Massachusetts tax credit designed to lure Hollywood filmmakers to the Commonwealth came under criticism after a report by the Department of Revenue said the credit had created only 222 jobs last year, at a cost to taxpayers of $325,000 per job.

Now the New York Times reports that at a time of budget cuts, many other states that have offered some form of subsidies for movie producers are considering rolling back their programs. Arizona, Iowa, and Kansas have all discontinued or suspended film subsidies, the Times reports.

But one defender of the Massachusetts credit, Nick Paleologos, the former head of the state film office, says the Department of Revenue's report doesn't tell the whole jobs story. Among other things, Paleologos criticizes the state for not attempting to gauge the impact of movies featuring Massachusetts on tourism. He also argues that money spent attracting movies produces a ripple effect of benefits for the state:

Attracting movies with big stars gives Massachusetts bang after bang after bang for every buck we spend on tax credits. First, when the film is being made, we get the benefit of millions of dollars in direct and indirect production spending. Second, when the film is later released, we get the benefit of millions of dollars of marketing and promotion paid for by the studios. Finally, if the film is nominated for awards, we get the benefit of millions more dollars worth of advertising for our state.

Paleologos also maintained that the state's numbers over a four-year span provided a fuller picture of the credit's economic impact.

"My bottom line is that between 2006 and 2009, during a terrible recession, this industry created over 3,000 jobs in Massachusetts," he wrote in an e-mail to the Globe. "Pretty good numbers, no matter how you slice them."

Globe file photo, actor Mel Gibson sits with Bojana Novakovic, who plays his daughter in the movie "Edge of Darkness" during a break from filming in the Public Garden in Boston in 2008.

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ABOUT THE ANGLE Online commentary and news analysis from the Boston Globe. The Angle is produced by Rob Anderson and Alan Wirzbicki. You can follow Rob on Twitter at @rcand.

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