Film industry set to sue the state over tax cap


Written by: Ryan Naquin, Reporter

NEW ORLEANS (WVUE) –

A showdown between the film industry and its former ally is possibly heading to the court system.

The threat to file suit started when state lawmakers put a $180 million cap on movie tax credits to balance the $1.6 billion deficit lawmakers faced for this year’s budget.

The industry used to have unlimited credits getting more than $230 million each year for the past two years.

But critics believe the cap is unconstitutional.

“(Lawmakers) had to destroy the constitution in order to get to the saving that they were looking for, knowing that we are going to challenge it and knowing that we are going to win,” Film Production Capital President Will French said. “That money really isn’t going to be there for them at the end of the day.”

French believes with a cap film makers will go to states like Georgia and California to shoot movies, he wants Governor Jindal to veto the cap.

“If the governor doesn’t handle this we are going to court with it,” he said.

Governor Jindal’s office responded saying the he will review the cap when it is on his desk next week.

Louisiana Budget Project Director Jan Moller believes the movie tax credits were killing the state’s bottom line.

“Every dollar we spend on films is one dollar we cannot spend to educate a child, to provide healthcare to somebody who needs it, to provide childcare assistance to do any of the other things that state dollars are used for,” Moller said.

He saw the cap as necessary to keep the industry from making the state bear the financial burden.

“We’ve been saying for years, the film subsidy program has been operating like an open ended entitlement and the cost has been going up year after year,” Moller said. “When the state has been facing fiscal problems, we think this industry just like every other part of state government needs to live within a budget.”

French argues the cap will only be enforced when credits are submitted to the state, which means there will be a mad dash to file taxes and some people could be left with useless tax credits.

“You’re inducing more production into the state, because you’re not capping the front end as you might say, but you’re limiting their ability to finally monetize those credits on the back end. More people are going to be upset and more businesses are going to be let down,” French said.

http://www.kplctv.com/story/29310608/film-industry-set-to-sue-the-state-over-tax-cap

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