St. Paul, MN - A bipartisan Film-Production Tax Credit bill, HF 1975, authored by Iron Ranger Rep. Dave Lislegard (DFL 06B), Rep. Greg Davids (R 28B), Rep. Cheryl Youakim (DFL 46B), Rep. Sydney Jordan (DFL 60A), Rep. Zack Stephenson (DFL 36A), Rep. Julia Sandstede (DFL 06A), and Rep. Kelly Morrison (DFL 33B) has been included in the House Omnibus Tax Bill, which was voted out of Committee and is headed for the House Ways & Means Committee.
The Senate bill, SF 1986 is authored by Senator David J. Tomassoni (06 I), Senator Karin Housley (39 R), Senator Julia E. Coleman (47 R), and Senate Tax Committee Chair Carla J. Nelson (26 R). The bills create a transferable tax credit of up to 25% on qualified in-state expenditures for TV/film production. Minnesota appropriates zero dollars on this program as the credits are not used until a production company spends money here in the state, paying all of the applicable taxes on their spending.
'This bill will bring millions of dollars in new spending and thousands of jobs to Minnesota,' said Melodie Bahan, Executive Director of MN Film & TV. 'We're grateful for the bipartisan support of legislators who understand that film and TV production can be part of our post- COVID economic recovery.'
In addition to legislative support and the support of MN Film & TV and SAG-AFTRA, a recent hearing in the House included supportive testimony of labor/union leaders from IATSE Local 490, Teamsters Joint Council 32, and the Directors Guild of America. In addition, Emily Larson, Mayor of Duluth, testified about that city's positive experience with film projects, noting that 'Luring film and TV production is valuable to states and regions because production creates good jobs and injects money into the economy. [It] also brings visibility… increasing tourism and expanding sales tax for cities, counties, and the entire state.' St. Louis County recently passed a local film and TV incentive to encourage more work in the county and Duluth area.
'This bill is not just good for our members, but also for businesses around the shooting location - everything from restaurants to dry cleaners to hotels,' said SAG-AFTRA National Executive Director David White. 'There are three great reasons to pass this bill: More money for the state, stimulus for the economy and more jobs for working people. And it comes with a bonus: all of it helps to create art that enriches our culture.'
Tourism sees a definite impact from local film production. A survey conducted on behalf of Visit Florida found that '22.7 percent of leisure visitors (19.5 percent of all visitors) stated that viewing a movie or television series filmed in Florida was either 'extremely important' or 'very important' in their decision to travel to Florida.' A conservative estimate from New Mexico shows the Film Induced Tourism 'influenced, in whole or in part, between 5 percent and 13 percent of total visitor spending in 2014 (or between $302 million and $777 million).'
A recent report by the Motion Picture Association of America (MPAA) revealed that the highly labor-intensive film/TV industry is responsible for creating 2.6 million jobs nationwide. Two- thirds of those jobs were in indirect industries such as hospitality, transportation, and the construction/building trades. IATSE rep Brian Simpson testified that film/TV production 'is like modern-day manufacturing and can only be done by real people working real middle-class jobs. Due to competition from other states [with tax incentives] and Canada, Minnesota has been exporting these jobs for at least 20 years now, but we can bring this back.' During the hearing, Rep Youakim also pointed out the benefit local economies see with film/TV production, noting that main street business owners in her district saw production dollars spent in their shops when the 2011 film 'Thin Ice' was shot there.
Several states have realized substantial benefits from similar production tax credits. The first season of the Hulu series 'Castle Rock,' shot in Massachusetts, created 1,026 jobs and generated $69 million in economic activity. Each $1 of tax credit generated an estimated $4.73 in economic activity in the state. During their twelve-month production period 'Castle Rock' expenditures for hotels and motels, including casino hotels were $914,000. The numbers were even more dramatic in Utah, where that ratio was $14 in new state GDP for every $1 of tax credit issued. The MPAA reports that up to $250,000 per day can be introduced into local economies when a film shoots on location.
During testimony, Melodie Bahan, Executive Director of MN Film & TV, highlighted how crucial the timing of this bill could be. Because so many productions were forced to shut down during the pandemic, there is an enormous backlog of shows waiting to be made. Coupled with the explosive growth of streaming viewership throughout 2020, there is now a demand for new content that outstrips current studio capacity. If history is any guide, these shows will be made in states with production incentives.
If the bill is passed, it is poised to potentially bring millions yearly into the state's economy from producers that would begin using the incentive to produce the backlog of on hold productions. Passage of this bill will also provide an important financial incentive for many years to encourage production of all kinds in our state. Rep Lislegard, who was cast as a local actor in the 2005 film 'North Country,' shot partially on the Iron Range, noted 'An incentive program like a film tax credit is the only way to build this thriving industry and allow it to be sustainable. This is truly a 'but for' proposal. Without a tax credit they will not come.'
For more background and information, please listen to the March 24th Clip of Rep. Dave Lislegard's story of working on the MN-Made film 'North Country' and the economic impact it had on his life and community.