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Capital Beat: Tinseltown, N.H.? House panel mulls tax break for films

Last modified: 9/10/2013 5:08:33 PM
Concord probably isn’t going to become the new Hollywood. But that doesn’t mean Granite State lawmakers and media-industry types can’t dream big.

A bill pending in the Legislature would create a new tax credit for movie and television productions in New Hampshire, an incentive already offered by most other states.

“When I pick up the phone, that’s the first question they ask, and when I don’t have an answer, they look elsewhere,” said Matthew Newton, director of the New Hampshire Film and Television Office. “We’re at a disadvantage.”

But there are plenty of opponents who point out that film tax incentives haven’t always lived up to the hype in other states.

“It’s good politics, but bad economic development policy,” said Joe Henchman, vice president of state projects at the Tax Foundation, who said roughly 40 states have some form of film tax break. “That’s why a lot of states adopt it, and because so many states have adopted it and so many states are throwing money at film and television productions, it’s hard to be competitive.”

The proposed New Hampshire program would create a credit against the Business Profits Tax for film productions, up to 25 percent of payroll plus up to 25 percent of production costs.

Newton said, even with the tax credit, New Hampshire doesn’t have the infrastructure to host big blockbuster films.

“What we’re looking at is more the lower-budgeted, independent films,” he said.

In fact, the bill specifies that full-length films, television series and commercials would all be eligible for the credit – though it specifically bars pornographic movies from getting a tax break.

The legislation isn’t exactly on the fast track. It was introduced this year by Rep. Jeff Goley, a Manchester Democrat, but the House Ways and Means Committee retained it for more work. It won’t go to the floor until January.

Rep. Susan Almy, the Lebanon Democrat who chairs the committee, isn’t a fan.

“It got retained because a slight majority of the committee voted to try and see if there was any way to make the bill economically feasible for both the state and the film industry, which I believe there is not,” Almy said.

Film tax incentives have been popular in many states – they hand out a total of $1.5 billion in tax breaks a year, The New York Times reported in December – and some have seen a boom in productions. In Massachusetts, tax incentives for film generated net new spending of $38.7 million in 2011, according to a Department of Revenue report.

But they haven’t been uniformly successful. Michigan has slashed its generous incentive program in recent years. In all, Henchman said, about a dozen states have pared back their programs or eliminated them entirely in recent years.

“Way back in the day, the first states to adopt this, they could just offer a little bit of subsidy and get a flood of productions into their state,” Henchman said. But now, he said, it’s more competitive, with some states offering generous tax breaks – up to 40 percent, for example, in upstate New York.

“If you want to drain productions from states that are doing that, you’ve got to top that, and it gets very expensive very quickly,” Henchman said.

Supporters are working to improve the New Hampshire bill, with a subcommittee work session scheduled Tuesday, said Tim Egan, president of the New Hampshire Production Coalition, the industry group pushing for the bill.

For example, he said, they’re proposing an annual cap of $5 million, and want to make the credits non-refundable, so the state wouldn’t have to pay out cash – though the film companies would still be able to sell credits to another business.

Egan said, in the end, creating tax incentives for film production would be a good deal for the state.

“The best thing I can compare it to is tourism. Tourism is an $8 or $9 return (for every $1 spent). Film is an $8 or $9 return,” he said.

Plus, Egan said, “the end product is another marketing tool” for New Hampshire.

Down-ballot blues

Jeb Bradley’s announcement last week that he won’t run next year for the U.S. Senate – or any other high office – was not good news for the New Hampshire Republican Party.

The Senate majority leader from Wolfeboro was pretty much the biggest GOP name in play for the 2014 election, a former two-term congressman with serious policy credentials.

And even if there isn’t a top-tier Republican challenger to Gov. Maggie Hassan next year, a Bradley run against U.S. Sen. Jeanne Shaheen could have anchored the GOP ticket for 2014.

How important is the top of the ticket?

Just ask Jim Coburn. Sure, 2006 was a Democratic year nationwide, but one-term state representative Coburn’s 26 percent of the vote against popular Gov. John Lynch didn’t do much to shield down-ballot candidates – the Democrats won control of the House, the Senate and the Executive Council.

Of course, the next election is still 14 months away. There hasn’t been much GOP activity so far in the gubernatorial race, aside from state Rep. George Lambert exploring a run, but plenty of names are in the mix for the Senate race.

Former state senator Jim Rubens will make an announcement Sept. 18, presumably that he’s running against Shaheen. Conservative activist Karen Testerman has said she’ll run against Shaheen if she can get 5,000 signatures on a petition at DraftKaren.com. Former U.S. senators Bob Smith and Scott Brown have flirted with the idea of a run, though Brown is from Massachusetts and Smith moved to Florida a decade ago.

And former seven-term congressman Charlie Bass emerged late last week for a possible political comeback against Shaheen, saying he’d been urged to throw his hat into the ring after Bradley’s exit from the race.

For now, at least, New Hampshire Democrats feel pretty good about 2014.

“I think it’s a reflection of the strength of Democrats up and down the ballot,” said Democratic Party spokesman Harrell Kirstein.

Forrester for Finance

There’s a new sheriff on the Senate Finance Committee.

Republican Sen. Jeanie Forrester of Meredith, who was vice chairwoman this year, has been elevated to chairwoman by Salem Republican Chuck Morse, the Finance Committee chairman who became the Senate’s president last week.

And to add a bipartisan touch, Morse made Sen. Lou D’Allesandro, a Manchester Democrat, the new vice chairman.

“I have complete confidence in their understanding of the intricacies of the budget, as well as their ability to oversee the implementation of this fiscal spending plan going forward,” Morse said in a statement.

Here come the bills

Tomorrow is the first day for House members to file bill requests for 2014.

Those legislative service requests, or LSRs, can be filed by representatives until 4 p.m. on Sept. 27. Senators can file bills starting Sept. 30 and through Oct. 25.

Presidential posse

The 2016 presidential primary doesn’t seem so long away for some people.

Some of the latest tidbits:

∎ New York Republican Rep. Peter King told WMUR on Friday, “I am considering a run for president.”

He’ll be headlining events in the state next weekend, including the Strafford County GOP Family BBQ and a breakfast fundraiser for Franklin Mayor Ken Merrifield.

∎ Terry Shumaker has resigned from the Ballot Law Commission to serve as senior state advisor to the “Ready for Hillary” committee. The former U.S. ambassador to Trinidad and Tobago was a Hillary Clinton supporter in 2008, and a Bill Clinton backer in 1992.

∎ On Sept. 28, former U.S. ambassador to the United Nations John Bolton will be attending the Hillsborough County Republican Committee Constitution Day Picnic in Hollis. The Republican flirted with a run for president in 2012, too.

News of record

∎ Happy birthday to former U.S. senator John E. Sununu (Tuesday).

∎ Will Craig, a longtime Hassan aide now serving as the governor’s policy director, has a new job pending an Oct. 1 aldermanic confirmation vote: economic development director in Manchester.

∎ GOP state Reps. Laurie Sanborn of Bedford and Marilinda Garcia of Salem are headed to Nashville this week for the Republican State Leadership Committee’s “Right Women, Right Now” summit.

∎ A special House election will be held Sept. 17 in Manchester’s Ward 7, with Democrat Mary Heath facing Republican Ross Terrio. Democrats Carl Andrade and Latha Mangipudi face off that day in a primary for the House seat representing Nashua’s Ward 8 that day, with the winner facing Republican Pete Silva in a Nov. 5 special election.

(Ben Leubsdorf can be reached at 369-3307 or bleubsdorf@cmonitor.com or on Twitter @BenLeubsdorf.)


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