Film industry advocates won a victory in the N.C. House Thursday – though it may be short-lived.
Speaker Thom Tillis broke with many fellow Republicans in backing a measure that would essentially extend the tax credits that supporters say have helped the industry prosper in Charlotte and elsewhere in the state.
But the measure, part of a larger bill, now goes to the Senate, which is scheduled to vote on a budget that would replace the tax credits with a much-smaller $10 million grant program.
Critics, including the Motion Picture Association of America, say the Senate plan would cripple if not kill the industry in the state. The MPAA said the industry would be “significantly underfunded” under the new state budget.
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One House member put it more dramatically.
“I honestly feel that this is a murder trial … and I’m fighting against the death penalty,” said Rep. Ted Davis, a Wilmington Republican who sponsored the measure. “Don’t let this session go down in history as killing the film industry in our state.”
The measure would extend a slightly modified system of tax credits for a year beyond its scheduled Jan. 1 end. It would allow the industry to draw on up to $40 million in credits over that time and launch a formal study of the industry in the state.
Tillis, from Huntersville, made a rare floor speech to push the measure.
“I actually believe that if we do not extend the film tax credit, you will see a cessation of productions in North Carolina,” he said.
Critics argued that the film industry should rise or fall without the support of taxpayers.
“Rep. Davis is doing just what he’s supposed to do – bring home the bacon to his district,” said GOP Rep. Paul Stam of Wake County. “And it will come out of all your districts.”
The measure passed 77-36 with virtually every Democrat and most Charlotte-area Republicans in support.
The state budget, released late Wednesday night, creates a $10 million grant program to support productions in the state.
It would replace the current program of tax credits, which paid out over $60 million in 2013. “Banshee” alone, shot in the Charlotte area, got credits worth $16.8 million.
Critics say the new program is not enough to retain productions at their current level. The MPAA agreed.
“(The) MPAA and its members have concluded that the $10 million grant program is significantly underfunded to support the level of jobs, spending and local investment in North Carolina,” senior vice president Vans Stevenson said in a statement. “MPAA requests that the legislature and Gov. (Pat) McCrory bolster the grant program while there is still time in this legislative session to preserve over 4,000 permanent, well-paying production-related jobs in the state.”
Critics question the number of jobs or economic impact that industry advocates claim.
The budget would allocate grants of up to $5 million for a feature film or TV series. Priority for grants would go to productions that hire the most state residents or offer the most opportunity to entice visitors.