Movie studio backers seek big break
Tax incentive bill would save developers up to $60m
The developers of a proposed $300 million movie and television production studio on the former South Weymouth Naval Air Base are seeking a tax break from the state that would allow them to save as much as $60 million on construction.
"We've told everybody the numbers just don't work without it," said Allan Kassirer, a principal for International Studio Group. "I've said to the governor and everybody on Beacon Hill that in order for the state to get the infrastructure, you need to have the incentives."
A bill, proposed by state Representative Ronald Mariano of Quincy, would give a 20 percent tax break to film companies on costs related to building their studios. It would also offer other state and local perks for studio owners by reclassifying film production as a manufacturing industry, making them exempt from the sales tax and allowing them to negotiate for other tax abatements in their host communities.
Mariano, who expects a legislative committee to begin reviewing the bill soon, sees the measure as critical to the film industry's future in Massachusetts, particularly when other states are putting together even more lucrative packages to bring such companies their way.
Michigan, for instance, enacted last week a 40 percent tax incentive for the film industry.
"Wherever the deal is, that's where they'll locate," Mariano said. "I'm hoping the Committee on Revenue can focus on this bill now so we can get it moving."
A group of major players in the California film industry announced for the South Weymouth studio on Tuesday.
"We literally are ready to go," Kassirer said. "We've been working on the design for the last eight months and studying where we would locate on the air base property."
They expect to initially use about 30 acres of the old base and expand to 50 acres.
But the tax incentives, Kassirer said, are critical. He said he has been discussing the project, and the need for incentives, with the state's top leaders for the past several weeks.
Kassirer said Massachusetts right now is capturing only "a small piece of the pie" by giving tax credits for shooting movies in the state.
"What's needed are aggressive incentives for infrastructure," Kassirer said. "If you don't have places to produce movies, you don't have an industry. What you have are people coming in to shoot during nice weather, and then leaving the state."
Kassirer predicted that the credit on infrastructure would "kick start" the industry in Massachusetts.
The project planned for the South Weymouth airbase is called Southfield Studios. It would include 10 to 15 soundstages, production and postproduction facilities, temporary and long-term office space, restaurants, retails shops, and tourist attractions.
When completed, Kassirer said, it would generate thousands of high-paying jobs, and - with training programs - a workforce that hails from Massachusetts rather than California.
David Kirkpatrick and his team of California film moguls have their own $300 million project proposed for a tract in South Plymouth, Plymouth Rock Studios. The focus is currently on securing the targeted site and getting a necessary zoning change.
Kirkpatrick said that he has been following the progress of Mariano's bill, but that the proposed incentives will not determine whether his project moves forward.
"For us, we'd love it, but we're not actively seeking it out," Kirkpatrick said on Thursday.
Opponents of Mariano's bill question the wisdom of giving handouts to corporations during tough economic times.
Michael J. Widmer, president of the Massachusetts Taxpayers Foundation, says it isn't fair to give such a substantial perk to a single segment of the economy. "It doesn't even pass the straight-face test," he said yesterday.
"The question is cost versus benefits," Widmer continued. "Before we add to what they already get, we have to ask, is this worth the benefit."
Kassirer said the answer is an unequivocal "yes."
"People say it's a money grab, but it's not," he said. "It lessens the financial burden on us. We're literally going to create thousands and thousands of high-paying jobs over the next two to four years."
He added that while the state will have allowed about $138 million in incentives, "its projected $1 billion 280 million [related to the film industry] will be circulating in the economy between 2006 and 2008."
Clarification: A story in Saturday's City & Region section on the construction of a movie and television production studio on the former South Weymouth Naval Air Base misstated what the developers are seeking from the Commonwealth. The developers are seeking a 20 percent tax credit on their $300 million project. The tax credit would amount to about $60 million and would be a credit on future state income taxes only after the project money has been spent. The developers would not receive funds immediately from the state Treasury.
