The possibility that North Carolina legislators may let the state’s film incentive program expire at the end of 2014 is raising some alarm at UNC-School of the Arts.
Those incentives have proven an important tool to the School of Filmmaking in its efforts to turn out graduates with the experience and résumés they need to get jobs, said Susan Ruskin, who took over as permanent dean of that school in July after having served as interim dean since 2012 and a faculty member since 2009.
“We want to graduate students who are hireable, and one of the great benefits of the incentive program for us is having movies come to our doorstep as opposed to sending students elsewhere for internships,” Ruskin said. “And if we lose the incentives, they won’t be able to find the jobs they want here. They’ll end up following where the films are.”
The state’s incentive program, which was sweetened in 2010 to offer productions a 25 percent refund on their spending in the state, survived the most recent session of the General Assembly despite efforts by some Republicans to weaken or eliminate it. But unless it is renewed, the program is scheduled to sunset at the end of next year.
Critics have focused on the lack of any job creation requirements tied to incentive payments and questions about their effectiveness relative to broader corporate income tax cuts, among other issues.
From the university’s perspective, it comes down to the fact that if producers don’t get incentives to come to North Carolina, they’ll go to states like Georgia or Texas where they do, Ruskin said. And that would mean many fewer opportunities like the one that came along last summer, when Matt Weiner, the producer of the hit show “Mad Men,” shot parts of his feature film “You Are Here” on the UNCSA campus, making use of dozens of UNCSA students in the process.
The incentives don’t just benefit big Hollywood producers, she added. Some of the money those productions spend goes to local companies in the industry. She cited two Winston-Salem firms, Video Collective and Process Pictures, that were started by UNCSA alumni because of strong filmmaking activity in the state.
“We want to see them stay, not leave, and the incentives help them stay,” she said of alums.
But lawmakers will have to balance the jobs and economic activity against the costs of the program to the state budget when that budget remains so tight. Because of the unique structure of the incentives to the film industry, qualifying productions can take more out of the state’s coffers than they put in directly through taxes or indirectly through taxes paid by the people they hire. The rest of the benefit of the spending the incentives draw to the state goes to the private sector, and that benefit ends when the production is over.
That makes some question the efficiency of the program. Mark Vitner, a senior economist at Wells Fargo, told National Public Radio recently that the film incentives feel like a hamster running on wheel — working hard, but not getting anywhere.
“It doesn’t improve our labor force, it doesn’t provide us with any fixed assets that are going to improve our competitiveness … The only thing that keeps bringing folks here is our willingness to continue to give them money,” he said.