Film incentives could return to North Carolina

When the state let its tax incentive program for movie production expire at the start this year, the North Carolina film industry suffered.

A law passed last summer gutted the previous program and replaced it with a $10 million stopgap program for the first half of 2015.

But on March 9, lawmakers introduced a bill to reinstate the previous incentives program and fund it to the tune of $66 million per year.

Under the bill, production companies that spend more than $250,000 for a project in North Carolina could receive a 25 percent refund on some film-related spending in the state. The previous incentive program was capped at $20 million per project.

Johnny Griffin, director of the Wilmington Regional Film Commission, said the area has been particularly hurt since the end of the program.

“Just in the Wilmington region, last year film productions here spent $170 million locally — that’s wages, goods and services purchased and rented from local vendors,” he said. “This year, 2015, we will probably do $40 to $50 million.”

The state has a long tradition of film production, including classics like “Dirty Dancing” and “The Color Purple.” Recent films that benefited from the expired tax credits include “The Hunger Games” series and “Iron Man 3,” as well as the popular television series “Homeland.”

Griffin said film production in the state has been severely curtailed. He said there are only about three or four productions currently filming, and he does not expect it to improve unless lawmakers act.

He said the change was felt right away in the industry.

“2014 was one of our more productive years. The incentives were doing exactly what they were designed to do,” he said. “In 2015, which is when the new grants-based program began, we saw an immediate reduction in filming.”

Griffin and proponents of the incentives say productions in the state stimulate the local economy. Film companies shop locally for supplies, and employees spend their wages in the communities in which they work. The industry lost about 4,000 permanent jobs when the benefits program expired.

“Sleepy Hollow,” a Fox series, has moved production to Georgia for its third season, where they will receive a 20 percent tax credit on expenses over $500,000, and an additional 10 percent credit if they include the state’s promotional logo in the credits.

State Rep. Susi Hamilton, D-New Hanover, has led the charge to revitalize the film incentive program.

Hamilton said she worried that as competitive programs were eliminated, the losses would continue or accelerate.

“Since it closed down on Dec. 31, we’ve seen an 80 percent reduction in calls to consider North Carolina as a place to do business, and we’ve had several announcements of existing productions leaving the state,” Hamilton said in a February news conference.

“The large sucking sound you heard from the film and television industry over the last several weeks since the credit ended would be the example.”

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