The newly-released feature film, “Breakthrough,” premiered in St. Louis Wednesday. That’s good news for the Missouri family upon which the inspirational film is based, but the film industry and site developers in the Show-Me State wish the production had happened here instead of Manitoba, Canada.
Missouri’s previous tax break bill expired in 2013. Production companies will not usually consider a state without that kind of financial welcome.
Film professionals say Missouri is missing out on millions of dollars in revenue – especially in small towns and rural areas. Senator Denny Hoskins of Warrensburg’s bill would bring back a tax incentive for bringing movies to Missouri. His bill has passed the Senate Economic Development Committee and would be placed next on the House calendar.
In this bill, the incentive is capped at $4.5 million per year and spread among credible companies that must spend first in the state, and then get a rebate.
Joni Tackette, president of the Missouri Motion Media Association, says in the past few years the state was not considered for a possible $150 million dollars in spending on stories based on Missouri. So Tackette and a supporting cast of actors, trade workers, trucking companies and tourism bureaus based in Missouri spoke to the Senate Economic Development committee in terms of trade.
“Gone Girl,” the Gillian Flynn blockbuster filmed in Cape Girardeau, brought in $7.8 million, including $298,000 in location expenses, then the incentive expired in the legislature.
Stephanie Skupham with the Kansas City Film Office says the state lost a chance to compete for the next Flynn film.
“For example, with ‘Sharp Objects,’ I visited the set there, they invited me there and they told me on set they were recreating Missouri and filming it in Georgia for $350,000 a day. But the producer said, ‘If you had had something, I could have made the argument to HBO,” Skupham testified.
That lost TV investment is most evident in the Netflix hit “Ozark” which is filmed in Georgia because of that state’s tax incentives, which has no cap on spending for the year. Missouri’s proposal would put it among the most modest of tax breaks, according to Skupham, and she says that’s good enough.
Tackette says now is a perfect time to bring it back.
“There’s never been more content being created, which means there’s never been more money being spent on creating that content. In 2013, when the original incentive program sunsetted, the discussion was about the film projects we will lose. Now the discussion is about the loss TV exposure,” she told lawmakers.
According to the Missouri Motion Picture Media Association, the spending projections on original TV programming in 2018 was:
• HBO – $2.5 Billion
• CBS – $4 Billion
• Netflix – $12-13 Billion ($22.5B by 2022)
Apple TV and WalMart are also entering the original film content market.
Missourian Robert Combest has a transport company that hauls trailers and transports materials for the film industry—including filming of “Up in the Air” by producer and St. Louis native Michael Buegg. He says there are plenty of opportunities for businesses like his.
Local actor Kyle Loethen testified because he is often cast in productions outside of Missouri and he wants to keep films in his home state:
“There are many Missouri-based stories that should be filmed for all the world to see. I’m sure there’s even a Mark Twain script out there and I’d hate for Missouri to miss out on that opportunity.”
No one spoke against the bill during the Senate committee hearing. In the past, the incentive was opposed by lawmakers against offering any tax incentives to incoming companies.
Senators, including Appropriations Chairman Dan Hegemen expressed concern that the bill should be subject to the state’s appropriations each year.
Hoskins counters that would get tangled up in production schedules.
“Many times these productions may lap over different fiscal years and so while there may be money appropriated one year for a particular film, the next year there may not be,” he told Missourinet. He says he’s open to rate adjustments but to tie it to appropriations would “effectively kill that program.”
What the film bill does:
This act reauthorizes a tax credit for certain expenses related to the production of qualified film production projects in this state, as defined in the act. Tax credits for such expenses under previous law expired on November 28, 2013.
For all tax years beginning on or after January 1, 2020, this act authorizes a tax credit equal to 20% of qualifying in-state expenses, as defined in the act, and 10% of qualifying out-of-state expenses, as defined in the act, associated with the production of a qualified film production project. An additional 5% may be awarded for both qualifying in-state and out-of-state expenses if at least 50% of the qualified film production project is filmed in Missouri.
This act shall sunset on December 31 six years from the effective date of the act, unless reauthorized by the General Assembly.