"We have the game to pull it off"
When Gov. Brian Sandoval signed Senate Bill 165, he took a big stride toward encouraging film production in our state. The bill takes effect on Jan. 1, 2014. Productions that shoot at least 60 percent in Nevada and pay for local labor, talent, crew or equipment can earn transferable tax credits of 15-19 percent of their production expenses, as long as those expenses are at least $500,000.
Some feel it’s about time, as two previous attempts had failed, but with a little star power (Nevada resident Nicholas Cage stumped for it at the Legislature) and political support, it pushed through. Hardly novel, given that 40 other states offer tax incentives. But will it lead to more jobs? Does it go far enough? What’s the next step?
We put some of these questions to Art Lynch. For 18 years, he has been on the national board for the Screen Actors Guild-American Federation of Television and Radio Announcers (SAG-AFTRA). A Chicagoan who moved here in 1984, he has more than 30 professional years as an actor.
How many times did you testify to get new film incentives for Nevada?
I went six times for three different legislations in eight years to testify on film incentives, at the Grant Sawyer Building and in Carson City. I learned how lobbyists work, and I was able to meet with AFL/CIO lobbyists and develop some fine points in lobbying.
What made it succeed this time after the failure of the previous two bills?
It was less grassroots than before, and we had more backing from national lawyers from other unions, particularly the AFL-CIO, and we presented a feasible plan. Also, it was more of a state bill, encompassing the work we were losing not just here but in Northern Nevada. Shows used casinos, large wealthy homes and so on, as well as scenery. In fact, Kansas has been played by Northern Nevada. You can’t ignore other aspects of the state, too, such as the Rockies (Great Basin and Sierra Nevada), small-town Midwest (a few towns in state look that way) and so on. Also the state didn’t have a heavy agenda this time, so it passed through successfully. It helped to have a little face recognition like Cage, who echoed our sentiments that if you start with some good incentives, you get investments.
How does this bill match up with others in the U.S.? New Mexico offers 25 percent refund tax credit, with no minimum budget or spending required.
The bill is relatively small at $20 million, and it is a test program for the next four years. Incentives from other states generally take the form of tax credits, such as those applied to the production company’s state income tax, but since we have no state income tax, and we cannot waive transportation fees, our incentive must be in the different form of a rebate. It is capped at $20 million because there is still a belief that the film industry doesn’t need a break, but if that were true, why do so many states offer that [no caps]. Hopefully, we can get nice small productions instead of one big one draining the cap. We’ll just have to wait and see what the State Economic Development [office] will have in store for us.
It takes effect next January through the State Economic Development Commission. How long do you think it will be before we start seeing results?
The unknown factor is how long it will take to put an infrastructure in place. They should have something in place by March and hopefully no later than that, depending on government bureaucracy.
Do we have the vendors and talent to support productions coming here, and therefore solidify the credibility of passing this bill?
At the $20 million level, yes, we have the game to pull it off. Las Vegas is already home to talented film- and sound-crew workers, and people will relocate if there is work. We have productions going on all the time, Lord knows we have music videos being shot here continually. Keep in mind, the Strip has highly qualified techs, wardrobe and designers, more so than Broadway because we pay more. Other states have proved with tax credits and rebates on in-state expenditures that the jobs, investments and even tourist traffic have followed.
What is the predicted ratio of productions being shot here in Las Vegas and say, Reno?
The vast majority of productions are shot here for proximity and that brilliant urban myth — the “What happens in Vegas stays in Vegas” motto is so damn successful. It’s a marker that everyone knows. But this should help in Northern Nevada, as a lot of westerns and programs emphasizing outdoor lifestyles were filmed there.
What are the signs of success that will enable you to return to the state Legislature to ask for bigger incentives?
The amount of money that will be returned on the investments will be key, and, of course, putting our nose to the grindstone and making this work. Only failure will prevent us from asking for more, something we are going to work hard to avoid.