New Mexico debt to filmmakers inches toward $250M
SANTA FE, N.M. (AP) — New Mexico’s debt to the film industry could hit $250 million by summer and reach $700 million in four years, according to state economist.
Jon Clark, chief economist for the Legislative Finance Committee, told state lawmakers that New Mexico is on track to reach a “breaking point” eventually under the current system, which offers movie companies a 25 percent tax rebate but limits the state’s annual payout to $50 million, The Albuquerque Journal reported .
The state is reaching the limit each year, running up an unpaid tab of film incentives.
No consensus emerged Monday on how to address the cost.
Senate Majority Leader Peter Wirth, D-Santa Fe, said filmmaking has been an important part of the economy, especially over the past few years when other sectors struggled.
“There’s no question that this industry is a huge deal in our part of our state,” Wirth said. But “I really hope we can find a way to restructure this.”
Gov. Susana Martinez, a Republican whose term ends this month, signed legislation in 2011 imposing the $50 million annual limit as a way to provide budget certainty and protect state finances.
Clark said it would take the state 14 years at $50 million annually to pay off a $700 million backlog.
“At some point,” he said, “we’re going to reach a breaking point where companies will stop investing.”
Rep. Antonio “Moe” Maestas, D-Albuquerque, said the state should take a fresh look at the film incentive law in light of the deal announced in October to bring Netflix’s first U.S. production hub to Albuquerque. The company — an entertainment giant that allows customers to stream movies and TV shows online — is buying Albuquerque Studios.
Information from: Albuquerque Journal, http://www.abqjournal.com