Economy/ Politics

Senate reins in movie star spending

Amendment says salaries over $1m not eligible for film tax credit

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THE MASSACHUSETTS SENATE put the state’s film tax credit in play on Tuesday, approving a budget amendment that would shave about $15 million off of the roughly $80 million in subsidies offered to commercials and movies filmed in Massachusetts each year.

The film tax credit has become a political football on Beacon Hill, with governors, budget analysts, and liberals regularly decrying the use of taxpayer dollars to subsidize Hollywood film productions. But the tax credit has survived every challenge since it took effect in 2006. The tax credit’s many supporters, particularly in the House, see the incentive as a way to grow a business that provides jobs while placing little demand on the state and its municipalities for services.

The tax credit essentially requires the state to pay 25 percent of the cost of any film, documentary, or commercial filmed in Massachusetts. The most recent Revenue Department report on the film tax credit showed it generated $254 million in new spending on movies, TV shows, and commercials in 2014, with 46 percent of those expenditures going to Massachusetts residents or businesses.

The amendment, filed by Sen. Michael Rodrigues of Westport and approved in an informal standing vote of 23-9, bars the tax credit from being applied to individual salary levels greater than $1 million. It also requires that a movie or commercial, to qualify for the tax credit, must spend 75 percent of its film days or 75 percent of its budget in Massachusetts. The percentages in both cases are up from 50 percent.

Rodrigues said the evidence is clear that the state gets a poor return for its investment in the film tax credit. But he said he recognized that many lawmakers like the jobs the film tax credit brings to their districts.

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About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

“I knew I had to limit the size of the bite I took out of the film tax credit,” he said. “It’s really not a bite, it’s more of a nibble.”

Rodrigues said it’s not right for state taxpayers to pay a quarter of a movie star’s salary, particularly with some of them earning millions of dollars for a film shoot. In 2014, the Revenue Department study said the film tax credit generated $168.7 million in wages, with 38 percent going to Massachusetts residents and the rest to out-of-state workers. Of the total wages paid out in 2014, $58.2 million, or 34 percent, went to people earning more than $1 million, according to the study.

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