Movie executive says new film cap could cost Louisiana more

BATON ROUGE, LA (WAFB) - Celtic Studios Executive Director Patrick Mulhearn says a funny thing happened when the Louisiana legislature rushed through a bill that would put a cap on film tax credits before this year's session at the Capitol ended. He says they put a cap on spending at $180 million, but failed to issue a cap on tax credits.

Mulhearn says it means the state could essentially be writing "bad checks" to film companies with no idea how much of the $180 million they might be exceeding. He says it all points to a sudden souring of what was a happy relationship with Hollywood South.

Mulhearn says Disney has already placed a moratorium on filming in Louisiana "until they get questions answered about how the new law will be implemented." The 30-percent tax credit Louisiana had up until now was certain and solid, according to Mulhearn.

The new deal?

"It creates unnecessary instability and uncertainty in the industry, and that is not the way the movie business does business," said Mulhearn.

Mulhearn says House Bill 829, which legislators passed in the final seconds of the session and Governor Bobby Jindal signed, is nothing like what movie industry leaders had discussed with lawmakers for months. He says the new law actually has "tax breaks" that could double those previously considered too generous.

"What this has done is added an additional fifteen percent on top of that 30," explained Mulhearn. "It's set up now that if you had a script and it was owned by a Louisiana company and any script could be pushed through a Louisiana company, it's going to give you an additional 15 percent. So, we're talking about a 45-percent tax break which is a huge expansion of the program."

The addition of other incentives outlined in the law could mean a 60-percent tax break.

Mulhearn said the additions to the bill got no discussion from the floor or the very people in charge of working out the best deal for movie makers and the state. Senator J.P. Morrell, D-New Orleans, headed that advisory commission, but Mulhearn says Morrell was not allowed to say a word about this final legislation as time ran out and the bill passed.

Lt. Governor Jay Dardenne, in a release, said "the $180 million cap raises too many questions about whether producers of TV and films in the state will be able to collect their credits that are now worth up to $30 million per production."

Mulhearn is hoping for an intervention with the Department of Revenue and Economy Development. He hopes "emergency surgery" can be performed on the language of the law before it's too late.

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