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The Louisiana House of Representatives on Tuesday voted 87-12 to approve a bill that would, among other reforms, eliminate the state’s tax incentive program for film production. The bill now heads to the Senate.
Jason Waggenspack, president of Film Louisiana, tells Daily Report that he and other film industry stakeholders remain optimistic about the future of the incentive program despite what has transpired in the House.
“Myself and four others are up here at the Capitol talking with both House and Senate leadership. … We’re having very good conversations, so we’re optimistic on our side that we’re going to figure out the best possible path forward for this program,” he says.
Katie Pryor, executive director of the Baton Rouge Film Commission, is similarly hopeful—in large part because of the “pro-business” sentiment in Gov. Jeff Landry’s administration.
“For the past 20 years, the film industry has been a stronghold in Louisiana,” she says. “It’s created jobs, revenue sources and incredible opportunity, and it’s attracted young people. I have to imagine a pro-business administration would see the value in that.”
Louisiana in 1992 became the first state in the country to adopt a tax incentive program for film production. The state is currently authorized to dole out $180 million in film tax credits each year. Though Louisiana pioneered the model, programs in states like California, Georgia and New York have come to dwarf its own.
According to Waggenspack, Louisiana’s film industry currently supports somewhere in the neighborhood of 10,000 jobs. If the state’s incentive program is eliminated, he says a great deal of those jobs would disappear.
“I don’t have a specific number, but I believe you would obviously find a massive reduction in the amount of people working in the industry if the program were to be eliminated,” he says.
Film production is one of a handful of incentive programs on the chopping block as part of Landry’s proposed Louisiana Forward tax reform package. To offset proposed cuts to corporate and personal income tax rates, he and Department of Revenue Secretary Richard Nelson are pushing to do away with some such programs.
Critics of the incentive program often point to a Department of Revenue report that found that, for every dollar spent on the program during the 2022-2023 fiscal year, Louisiana’s GDP only grew by about 60 cents while state revenue shrunk by about 90 cents.
Waggenspack, however, contends that those figures don’t paint the full picture. He says the program “pays for itself” as Louisiana’s film industry brings in some $360 million per year in payroll, and he points to figures from Louisiana Economic Development to further underscore the program’s economic benefits.
“LED put out an economic impact report that shows that, for every dollar that comes out, $6.32 rolls back into the state’s economy,” he says. “That is the very definition of economic development.”
The film incentive program would sunset on June 30 if lawmakers do opt for elimination.
LED Secretary Susan Bourgeois has signaled that her agency would introduce a new package of business incentives during next April’s regular session if the incentive programs currently on the chopping block are eliminated. Such incentives might not be reserved for any specific industries and might instead be offered to any industries that create high-paying jobs.
As jobs in Louisiana’s film industry pay an average salary of $60,500, Pryor says the industry shouldn’t have a problem qualifying for such programs.
“I applaud [Bourgeois] for thinking outside the box and I think our performance numbers would hold up upon review,” she says.
