WWL>Topics>>4-4 10:10am Garland talks to experts about tax cuts in the film industry.

4-4 10:10am Garland talks to experts about tax cuts in the film industry.

Apr 4, 2013|

Garland talks to Will French, the Co-Founder and President of the Film Production Capital, Stephen Moret, Secretary of Louisiana Economic Development and Mark Romig, President and CEO of New Orleans Tourism and Marketing Corporation about tax cuts in the

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Automatically Generated Transcript (may not be 100% accurate)

Welcome to do a busy day and I think -- today. Twelve noon when you move on to something we really him don't look forward took a look at cyber attack. To me that's always been kind of an innocuous term and something I felt Michael wouldn't understand much. Of lately we've had a personal information stone -- worry about her personal IDs being -- -- -- -- who had very didn't do stolen I mean Social Security number. Credit card numbers addresses. Cell phone numbers Michelle Obama Joseph Biden kind of Supreme Court. Hillary Clinton. Found many many many movies sort of many many famous people. Plus millions -- view. We'll tell you how many banks have been that come in the -- Dating services have been that you do amendment and it's no longer. Our kids. Just screaming. Go a little have been for the fun -- now we're talking about the mafia. Now we're talking about Russian mafia now we're talking about not only nations states over the calls sub nation. Where there may be somebody that's actively hacking -- for the Chinese Government. Pretty -- doing in China. They take up residence. In terrorists. So it's very cold even appeared to crack. This source to know who's actually doing that. And I think you'll be surprised at least one of our pentagon. Communications. That I was -- -- freedom of information that actually talked about in nuclear. Deterrent. If -- get worse. That's 12 o'clock we'll have a couple of experts on the leaders through that comes solution. We're gonna continue at 11 o'clock our our talk. About Orleans parish prison revelations. Video. The -- your view of now seeing that was released by a federal judge -- Yesterday. And we talked about in the -- hearing in court continues today. So we'll. Have I mean. James cargo room reducing those Super Bowl host committee yet. Don't have Norris -- soon imprisoned activist former inmate. Director voice of the ex offender. It was wounded wrongfully incarcerated. He was innocent put him in June for 27. Years. This hour. We're gonna talk about the film industry and -- -- lot of you've touched and Singapore's -- saying. What are we gonna talk about the film industry and governor -- -- tax plan -- we're just confused Welch or -- We have Stephen Moret on the line with his secretary Louisiana economic development soon welcome back to the show appreciate the time. Good morning growing greater Internet could talk a new group will -- -- -- co-founder of present and film production capital and also you're with the LF EE bay. Again what's an acronym pellet BA is the -- that you're okay this is Louisiana film and entertainment associations and were nonprofit trade organization. I designed to grow the film and entertainment industries in the state of Louisiana. And to regulate the industry to stop abuse among the producers who were working in the state. And to advocate for the for the industry and -- within the legislature. Our little let me -- attuned to simplify it for me -- you repeat. As some of the things are read when I. Do little researcher on this one of them says this is an area. And she represented infringing three leaders. Say this could eviscerate the State's -- movie production industry -- In fact. Just the threat of changes in the current status. Causing some people in the movie industry to reconsider coming here now. So even Moret what were your thoughts. Well to the ministry has. Freight industry in the Louisiana and the tax -- program was designed to cultivate. And sustain a darling don't production history going back to really 2002. When come modern day version of its torrid. It's been very successful you know we now have one of the top we're now one of the top states in the country in terms of total production activity in -- of course thousands of jobs. And Louisiana that previously didn't exist war. Pumped into the great part of CoreStates. It's. It's also been obviously -- was -- large extent by you know relatively early start at one time was a -- truly unique tax incentive. How little production tax -- program that's been. I have copied in various forms by the states. We've been a big supporter of the industry we want the industry continue to be successful. Oh we just want to proposed some changes for the program that would reduce the fiscal launched. Does this -- -- -- tax credits from Louisiana. Here's the problem. It's not Jindal is tax swap that really is it meaningful to the film programmer to the tax incentives -- to the industry. Really that in Michigan operate whether there's an income tax or sales tax or seven stature or whatever. The problem is is that the idea that's included to increase in the states return on investment. Is to limit above line expenditures that's payments to cast directors producers. 21 million dollars -- per person and this is an industry. Where is the most successful. Films often have to pay much more than a million dollars to get -- to to work like -- a lead actress and I like that. So the promise. Now their -- as Stephen said lots of other states have -- Louisiana's model many of them do not have similar. Above -- -- caps. If we were to impose a one million dollar bottom -- cap and his big productions that come here would. All this had not come here anymore they would go to the states without the cap because they would go to where they get much return on their investment to business decision. Which means that we would start to lose those big productions in the big ones -- the ones that spend the most money Louisiana they're the ones that use that sound stages that our infrastructure. The facilities that have been built up with private capital investments of you know hundreds of millions of dollars at least a hundred million dollars. And so we don't wanna lose that business right now and we don't wanna lose our place within the within the industry as the number one stayed outside of of California new York and frankly. We're -- on New York shields right now we're doing great where Hollywood south. We grow in this industry from virtually nothing to. One point three millet a billion dollars a year of annual spending. And jobs well above 101000 and and we don't wanna lose right now in this would this would do serious harm to us. Horrible complexion even more lives about the million dollar cap. Home we will print with his co-founder president film production capital Stephen Mori whose -- will reduce economic development. Coming right back who called him questions to -- 60187. Texas 2787. Or if you listen nationwide told Fareed it's 66 dated on and 087. To come -- right. -- welcome back we're. Trying to figure out. It's governor Jindal tactful and thanks fulfillment for I think. We found that the tax plan itself sales are chicken thing. Isn't a big problem but what seeing some big. Problem is governor general -- what I've read -- -- institute of one million dollar cap. On the amount of things like individual actors -- -- news. That production companies could -- missed qualifying expenses. And it and I'm playing for titles credits through the program we -- French where there are represented -- film -- prison with film productions capital Stephen -- secretary Louisiana economic environment. -- -- How about the claimed that if we do a million dollar cap other states don't have veteran that's one of the things we have people don't have and if we do worry whether we're gonna lose our ability to try to film industry like we do. Well these are I think it's it's first important to just to explain how does the program works for the economics of this program for your listeners -- -- -- -- program basically just owns 30%. British think credit for expenditures they make a mistake for qualified expert -- Louisiana and they get 35%. For the Louisiana Rosa labor. That's not the one Tom consensus -- includes you know as long as any any project that this in the states because it's extremely generous. That's one of the reasons why it's such such a big impact on growing industry and we cannot -- at a tremendous economic impact. But -- -- series -- third -- studies have been done how to carve a legislature every two years that these people swarmed we've we've published to them a third one. A every two years to come out of the last four years to have been published another one is about -- be published all through those studies that they escalation and it. For the films and if you assume that all the spinning happens. In the Louisiana. Accomplishment as economic impact the from a fiscal perspective for every dollar and tax credits provided by the state. The industry generates. Only about fifteen cents for the -- resources. I -- lost about 85 cents a -- per dollar tax credits that are provided to put -- of very very expensive program. He's at the same time it's a very effective program for from the perspective of you know -- economy. What we're simply saying is that we wanna continue to program and basically as it's structured today. But we want to ensure that we're going to be providing tax credits that are so war urged. That they simply be provided for and focused on activities to actually occurring in the state of Louisiana I think anyone. Would recognize and after out of Los Angeles and New York City. It comes -- she just don't we can't think it's paid -- for two million dollars for that we are trying to major actor. The mom know just as an example who get three million dollar tax credit today we know. And consistent except in very rare instances the vast majority that money doesn't -- and we candidates stand in California or New York. The reason that we go through -- and we really propose to only pay. Actually it's the first million dollars. For the -- the competitive they actually ever they want. It's simply just recognizing that spending for the most part is not happening. In the Louisiana I want things going emphasizes that you know we have spoken with the Friday at stake holders in the industry that in the Louisiana's coast. So the major studios. We've indicated that we welcome. We have other suggestions solutions just kind of starting proposal. That we made you know we are trying to ensure. Now we have a program that sustainable. And then we afforded the program causing pain in any further cuts and health care and higher education and this is one way to do that. -- Well then I think it's important that have an understanding of the big picture here there's something bigger going on in the film industry as a whole. Not just here in the -- and -- and it's something that provides a great opportunity for Louisiana to cash in on. And to understand and I'm gonna ask the thinkpad the music industry and how it's been affected by technology in the last ten years -- so. It used to be that they musician would release an album and would generate most of their revenue by album sales records dvd as -- these things like that. And then they'll go on tour to promote the the album that's no longer the case because of the Internet to music downloads. Now most of the money is not made by a record sales are -- sales because they're consumed on an individual song basis. But most the money is made by going out on tour around the country and albums are now released to promote the two were supposed the other way around. It's that changing technology that caused that to happen in a similar change in technology has happened in the film industry. And it's created a big disruption to him and think about this for a second. It used to be that a camera was the size of a motorcycle probably ten times the cost. It used to be that that editing equipment for per film would take out the one or two rooms and be extraordinarily expensive. That now a camera can fit in your hand. In fact we just had a film that was shot in Puerto Rico and most the film was shot using go pro cameras which can put on helmets and things like that. Editing equipment this is a Mac computer on steroids final cut pro by apple is is very user friendly and is very inexpensive and that's what's being used primarily right now. In fact it's so user friendly that my nine year old son over Newman School use it after school each day to day just as a hobby to put films together. So what that means is that the changing technology. Means that you no longer have to be based in Hollywood where all those. All time resources and assets work and -- it -- about this also used to be the judge issued on 35 millimeter film. Fly that film back to a lab and LA to have it developed had it sent back to your location just she could she would have been shot that date. It's no longer -- -- -- film right onto the hard drive you stick the hard drive right into the computer negotiate in the editing so this type of work. Can be done at a location now and and because it can be on location the industry wants to be done a location for this reason also. The quality of life in the major film centers of Hollywood didn't -- New York is relatively -- long commutes lots of competition for jobs. -- a really high cost of living. When people come here. Their quality of life imprison their cost of living be precise here this every day -- -- moved to Louisiana to work the film industry and they say you know what. I can afford a house here I can only -- an apartment in LA my -- here as a front yard and backyard in LA my apartment was an hour outside of Canada had to commute to a place. They wanna be here they love being here it's cheaper to be here and so they're gonna do as much as they came here because the technology allows them to what to do it and if they're here. They're not competing against 101000 other people with their skill sets to work on any particular film. They're competing against five people were ten people at best and so there working as much as they as they can work. So. Right now there's this what I call limited decentralization. That's going on with in the film industry people are uprooting from those traditional film -- and they're going out to these Texas in the states. And it's the incentive programs. That are steering where they relocate to so this is not a matter of let's put out some money and encourage a little bit of production activity to come in. With the understanding that it -- all then leave the next day or the next year or something like that. These are people really. Uprooting themselves from the film hubs and planning those roots in Louisiana and we wondering courage that. While it's going on -- go on forever now -- go on to the next five years or ten years probably sell and so I think we need to be as aggressive as we can. To encourage those people to come into Louisiana and plant their roots here and help us grow our film industry. Into a truly. Self sustaining industry that will be beneficial for the long term will create tax dollars in revenue and jobs for decades to come. Our group -- about a minute wait for news throughout all hold back from the -- question. Stephen -- -- -- -- as -- perhaps power we can you give us a few more minutes. Doubtful because quote more and more -- and soon everything you say and motive function of what -- said and we nor. Losing that much money to bring it in -- in the news or talking about it we could use money for schools and hospitals and -- celebre. But what you should was. It's sounds like we have an attraction to -- come regardless because. People the cost of living is low and they enjoy the food and whatever those questions -- one out from a comeback bureau trying to better understand such words from the film industry. And the -- Governor Jindal is at least talked about intentions of putting a million dollar cap. Some of the tax credits concerning the industry will kill the industry -- or change it radically we're coming right back in. We'll be back also won't put brought -- -- hopefully bring more room again and who's -- present CU new orleans' tourism marketing corporation. And try to -- work and some cults come right back. All right I'm gonna try to talk as little -- and backhand we're talking about the film industry continues. There may or may not help the industry we're being joined by Leo marked only with Stephen Mori will consumers through his secretary Louisiana economic development. French president film production capital reviewing the -- to shrink and Marco courses presidency -- -- New Orleans tourism marketing corporation. -- that you were much -- -- -- and somebody tomorrow. On the show. What were you thinking. Well good morning to Garland stayed -- well -- the should. I mean it's been fantastic for my AM from a messaging and imaging standpoint for the state of Louisiana. It's sending out some. What part of business messages to the folks who are investing in. Bringing in production here but also. -- spread the word about how are great Louisiana is as a as a destination -- particularly when the productions and feature. This sights and sounds and scenes from from the state. So it's been I think very positive to. The image of Louisiana has done as a destination. You concerned about the million dollar capped. Trying their unit south. We certainly want to improve a system that we have in place and not not inhibited and you know the attractive -- on the development and job growth tax system that. The governor and his team have been. Trying to work through I think is something we all want it's just and we wanna make sure that we we do it in a way that. Doesn't injure the the current system that is providing some excellent job growth and and spending in this state. -- we're bringing some of our callers who's been a big subject a lot of interest and -- and I know this Bryan little. We'll bring Brian and Brian welcome to the show. Garland value. Which -- the truth. It took a little bit of content. That's. I I think the film an -- grow here. Considerably if astronomical how an unbelievable how quickly and how how. It's gotten here I'm creating so many jobs across the board but people different -- -- they think -- -- a couple of cameraman. And some actors -- appreciate industry. -- you know hotel's hospitality. Transportation is reaches out every every arm possible unemployment. Opportunity armed and one great thing about having worked here -- -- looking to be here. I'm effect everyone who works here who comes from Los Angeles or or New York aware effort to work here -- little -- -- -- Louisiana called -- -- and two friends two on one with a costume designer wanna make a part. Wonder Dubai and I think one of intercollegiate fireplace in the or -- -- they picnic table that we come back because. There's no place like nor are there no place like Louisiana to shape unfortunately I just absolutely. Well fortunately absolutely clinical and out. And called. The great. But you know we've we've got -- talking that you know if the tax credits or changed if they're if there's too much limitation put on the PPP some intent there. There's a lot of different history will go elsewhere. I'm -- -- another movie and often. That they had chance -- at great pact and center and they they changed some and the film industry's go to trial -- so I'm just saying why why let her company that is obviously working so well. Corridor. Will and Stephen Krugman you. To misrepresent her son of the Willa I think earned Stephen Morrison that we lose. A pretty good do a portion of the dollar bill. This -- you do your by the -- industry. And it sounds like to me most of it goes out of state and what -- -- response there. Yeah I think that's the wrong way of looking at it come that what Stephen was referring to was that. When you issue a tax credit. The state takes backed into its coffers to state and local tax collections of between fifteen and twenty cents on the dollar. So some people say look that's our return on investment we give at a dollar we get back fifteen cents or twenty cents but that's really not the way of of looking at this is an investment. That the state is making to develop create and build a whole new industry in the state of Louisiana that wasn't here before. We're not doing it because we plan on making a profit every year -- because we plan on paying out one dollar in tax credits to get back. A dollar -- a dollar twenty in actual cash for the state coffers. We're doing it could -- wanna create jobs put people to work take them off the unemployment rolls. But we're doing it because you wanna create an industry that over decades and decades will generate tax revenue and which will be self sustaining and be a magnet for bringing. Further business and and tourism you dollars to the state going forward. The fifteen to twenty cents on the dollar I regard as as a as. Reducing the overall annual cost of the program because we actually get some money back for doing it and the analogy that I love to use his. It's like Billy get a highrise office tower. During the time when you're building the tower you're not gonna make any money you're going to be spending money without making any. Once the tower is complete then you'll be making money for decades and decades and decades to come and that's what we're talking about here can't build the industry. -- the benefits are long term and we'll get them in the future. We're talking about the film industry coming right back. -- back together if we're talking about the film industry is Stephen Moret has to -- Stephen got that I think we're somebody says that every dollar spent in their studies that back this something. Every those who bond movie in history a 106 dollars Barack. There was. No clue who -- have been 33 party studies. Informant -- to request the legislature. All three studies basically issued the same thing they this year that for every dollar in tax credits there's roughly six story of economic impact. However for every dollar of tax credits there's an 85%. Loss of -- of state tax revenue and that is exactly as well describe that he's actually right I mean that this program is designed to generate. To build an industry and to generate and sustain a lot of jobs that's been very successful it's just very. Expenses from a fiscal perspective. You -- think that this would mean the more the industry grows we certainly get more jobs. In terms of funding for health care harsh -- actually get down but that was one of the reasons that. One of the significant contributors to the decline in funding for health care our education -- cheers now there's a great industry. -- wanna continue to thrive in the Louisiana. And that's why worse same effort expenditures to happen that actually happened in the -- and we have an impact Louisiana economy that do little known fact. From these changes were to simply saying that we should reduce the amount which were subsidized the economies of New York -- -- Sooner -- it's time I don't know yours but you -- with the -- the longer have a good day and thanks for calling him. Thank you -- -- to let me turn to remove. You Madeline Madeleine urine governor bill. Batting average and intense in that chilling urging. And I think will French -- that's been pretty good point and I'm talking into perspective there's so many opportunities first. Interior to -- contribute to challenge streak. And to -- job after her for graduating students. Also down production at the popular. Topic during their recurring process for any incoming students -- -- that -- -- -- -- And -- big production company is circular migrate to states without the -- I think it would definitely had an impact on bringing more and more students to. Film here -- And -- -- -- -- -- students from out of town out of state to from from -- -- take three screws for -- coast playing the good let me play Lowell doubled pretend you're used to -- Yes sir the figures are here the figures as C. Monogram. -- you're 150 million dollars spent. That extrapolated to there expenditures. -- -- and money on the net side. Of 262 million if I understood you and Michael -- correctly was bogey of the -- talking about everyone who -- says or 500 million dollars for Super Bowl 150 million plus more of moderate growth. Where does that money go if I understood correctly we only keep three to 5% if that's true. 5% of them to succeed -- is what two million plus dollar store or even less. Shouldn't we do it would moderate -- we can do away with the -- content. And from movies I mean we've got to provide. Our current. Dual this overheads that didn't hit the same argument doesn't make a lot of sense that there are applying to the film industry. Yeah this is all -- I think if you look at it's all about the small business recovery and and small business development. This industry along with things like -- article on -- and our our other iconic celebrations throughout the year touched so many. Well businesses. It's the ripple effect is tremendous you've got people. Who are working now this industry itself with the ministry of the last numbers I -- for twelve elevenths. Over -- properly of people working in an industry that would not be working in the industry is that that they had not happened -- with that with the tax credits. Don't sustainable basis so. It got spending with the groceries you've got people buying clothing you've got people going to school and I think the transportation. And so it's it's it's hard to just ten points. One particular. Aspect devastated goes away that we that we -- -- regain it really is that ripple effect -- all about small business development. This city has the vibrant tourism economy. But almost sort of taxes that are some that are generated don't go to the city's treasury they're spread out to the states treasury they're spread out too. Things like the pain for the superdome -- -- the convention center. That this city actually gets very little direct. A tax revenue out of state hotel tax that hits the city but. But -- a group we're a bit better afford and -- on a large percent because it affects a lot of jobs that'll and a lot of small businesses. I think the comparison that you dismayed is really interest thing and I've been looking at these numbers also. A 150 million dollars of spending related to Marty brought in any given year and flasher in the film industry in the greater New Orleans area not the state the greater New Orleans area. 700 million dollars I don't know how much of that gets kept by the Levy taxes last year and how much it's kept by the city in taxes or. Or or what. But all I know is that that's more than four times the annual spending a Mardi Gras and so we is the greater New Orleans area really need to be protected in this industry and NB supportive of it. Yeah you do is I do I I think 22 wills point. Around the and then I'll look at it from the just that branding of this city and the greater Greta a region in the states. This is something that we we could not pay for weeks we don't have the budget to do with the film industry is doing for us to help spread the other word around that the country around the world that that we are the type of destination that we ourselves. I I totally agree with mark on that in fact I was talking to the the new governor of Puerto Rico two months ago. And he was so jealous that New Orleans has to remain which he says is a constant advertisement on cable TV. For music -- and in New Orleans and he's dying to find a way to get something similar for a for Puerto Rico. -- I'm I'm a little computer becomes I think. Will says there's this could put the six -- seven billion productions. That come here every year run. Yeah those are the ones that if we get money and benefits from my own blue ones that actually you the big -- Right yeah you probably that the six or seven biggest productions in the state in any given year would not come with a one million dollar bottom line salary cap. But they're not just the six or seven out of out of a hundred they're the ones that spend forty or 50% of the overall money that is spent in the film industry in the state in any given year. So if you cut that out of your system. Then you're going to reduce your the size of your industry by roughly forty or 50% and right now we support 141000. Jobs we don't wanna put at risk 7000. On a Marco and Donald you talked to him some people who -- you film industry could is strictly related. To tourism. On if bill other century implementing a lot of what we've done -- in order to. Compete producer Brian Billick talking about the -- talking about journalists and one of the things that separates us news. The lack of the million dollar cap. If that's implemented do you see. Business. Going away. I actually think it sends a signal. And it gives. Clark productions. Hard to look at their margins and the decisions will be made -- same thing as -- Look at what the sales tax could do to the hospitality industry and and placing as you know very precarious situation where. The that -- that the hard decision -- do we go to New Orleans or Louisiana or do we take that production and maybe. Do something that gives the same feel or our benefit of over the world so we got destinations are -- we just do it another city -- we -- to be very careful. How -- pile on to -- sort of artistic structure that could have a decision that goes against the -- and that would be concerned. -- 3232. For you Tom will do you good to -- -- thanks very much I can boil it -- here really point effort really quickly. North Carolina is one of those other forty states as a film instead of like Louisiana has and they have a one million dollar above lines salary cap. My issue they had about a 129 million dollars with the film spending in that state and we had one point three billion in Louisiana. They're less than 110 of where we are now we don't want to slam the brakes on our on our industry right now. Gentlemen I appreciate the time I think understand the usual little bit better and we'll do additional shows on this as it becomes a little bit more clear. What the governor is gonna do with the sax player -- you know with the movie and is remarkable moment. Thank you so much and will Princeton too -- common and have a great -- thanks revenue. Come right back we'll talk -- James -- bold above the show latest revelations from New Orleans parish prison and more. In the think -- Deborah --