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Like Indiana Jones, film tax credit survives a scrape

E-mail|Link|Comments () March 11, 2010 06:35 PM

Jay Connor for The Boston Globe

Ben Affleck prepared to shoot a scene for "The Town" in October in Harvard Square. Some were concerned that fewer movies would be shot in the state if the film tax credit were curtailed.

By Michael Levenson, Globe Staff

A legislative committee today shot down a bill that would have sharply curtailed the state’s tax credit for the film industry, arguing the legislation would have hurt a thriving industry that is one of the few bright spots during gloomy economic times.

The Revenue Committee’s 8-0 vote was a sign that the controversial credit could survive this year, even as Governor Deval Patrick has recommended trimming it to help close the state’s yawning budget gap.

Supporters of the film industry applauded the vote, contending that at a time when many businesses are shedding jobs, the credit has helped bring thousands of jobs and hundreds of millions of dollars in new spending to Massachusetts.

“Defeating this bill is an important step in preserving the hard-won gains for the scores of Massachusetts businesses and the thousands of working men and women in the Commonwealth who have benefited from the film credit,” Joe Maiella, president of the Massachusetts Production Coalition, said in a statement. “The Commonwealth simply can’t afford to lose the film credit.”

Critics have argued that the credit does not bring sufficient economic activity to justify its cost, which was about $60 million last year and is projected to grow to about $125 million this year.

Senator Benjamin B. Downing, a Pittsfield Democrat who is the Senate chair of the Revenue Comittee, voted to hold the bill in committee, rather than kill or endorse it, saying it deserved further consideration. He said the tax credit may be creating jobs, but lawmakers must consider cutting it during a dire budget year.

“Everything has to be on the table in a crisis like this,” Downing said. “I don’t want to be making promises to an industry that we are not able to uphold as we go through the budget process and through this year.”

Representative Jay R. Kaufman, a Lexington Democrat and House chairman of the Revenue Committee, disagreed. He argued that the credit has not only brought jobs to the state but has sparked interest from developers that want to build studios in Massachusetts.

Representative Jay R. Kaufman, a Lexington Democrat and House chairman of the Revenue Committee, argued that the credit has not only brought jobs to the state but has sparked interest from developers that want to build studios in Massachusetts.

“We looked at it as something that promises tax returns over time and an investment worth making,” Kaufman said.

The bill would have drastically reduced the credit, in part by capping the payout to $7 million per film. The governor, as part of his budget proposal for the next fiscal year, has proposed a less drastic cut. His plan calls for limiting the payout to $50 million per year for the next two years.