BOSTON — Supporters of the state's controversial film tax credit program, which doles out tens of millions of dollars worth of credits to movie production studios each year, want to make the subsidy permanent.
On Beacon Hill, a bipartisan proposal backed by more than 100 state lawmakers would eliminate a Jan. 1, 2023, expiration date on the more than decade-old program, which provides tax credits valued at roughly 25 percent of expenses for qualifying movies, TV shows, documentaries and commercials filmed in the state.
If approved, the move would essentially make the tax credits permanent.
Backers of the measure say the economic activity generated by the tax credits has created thousands of jobs and supports a small but thriving movie production industry.
Rep. Ann-Margaret Ferrante, a Gloucester Democrat and co-signer of the bill, said allowing the film tax credit to sunset in four years would jeopardize jobs and economic growth.
"We're building an industry here and instability isn't good for that," she said. "We need to keep the momentum going and keep attracting films to the state."
Film productions hire local set workers, boat captains, carpenters, electricians and others, Ferrante said. Cast and crew members spend money in hotels, restaurants and local businesses.
Despite criticism that the subsidies are a giveaway to Hollywood film stars and billionaire studio bosses, supporters say the tax credit program is a worthy investment.
"The film tax credits have helped create a motion picture industry, but they've also created thousands of jobs and helped support local businesses," said Steve Crawford, a spokesman for the Massachusetts Production Coalition, a trade group. "If those credits are allowed to sunset, the movie studios will go somewhere else and those jobs will go away."
The measure has support from a majority of Democratic lawmakers representing the North of Boston region, including Sens. Diana DiZoglio of Methuen and Brendan Crighton of Lynn and Reps. Linda Campbell of Methuen, Tram Nguyen of Andover, Tom Walsh of Peabody and Christina Minicucci of North Andover.
It is also backed by Republicans, including Senate Minority Leader Bruce Tarr of Gloucester, House Minority Leader Brad Jones of North Reading, and Reps. Jim Kelcourse of Amesbury and Brad Hill of Ipswich.
The battle over the film tax credits has become a perennial issue on Beacon Hill as supporters and opponents have sought to scale back, eliminate or expand the subsidies.
Gov. Charlie Baker, a Republican, pushed to scrap or scale back the subsidies during his first term, arguing that the costly tax credit program is doing little for the state's economy. But Baker's efforts were blocked in the Democratic-controlled Legislature.
To be sure, opponents of the tax credit have filed bills for the upcoming session to cap the film subsidies or end the program ahead of its 2023 expiration date.
The film tax credit provides a subsidy equal to 25 percent of production costs, which includes set construction, wages, security, food, gas, lodging and other expenses for the cast and crew. That means a film studio that spends $10 million in Massachusetts is eligible to get a tax credit worth $2.5 million — even if it paid little or no taxes here.
Since 2006, the state has doled out at least $550 million in credits for Hollywood hits like "The Town," "Grown Ups," and more recently, “Patriots Day,” which depicts the 2013 Boston Marathon Bombing.
There is no cap on the film tax credits, which can be "carried forward" up to five years, sold to another production studio, or even cashed in, according to the state.
In order to qualify, production costs for a film must exceed $50,000 within a year. Studios can even get an exemption from the state's 6.25 percent sales taxes to offset costs.
In 2017, the latest year for which figures are available, the state paid more than $23 million in tax credits to 118 productions, according to the Department of Revenue.
In the previous year, the state doled out nearly $89 million in film tax credits to 100 productions, including "Patriots Day."
State officials acknowledge that the credits have created employment, though they've pointed out that the average cost to the state is about $125,000 per job.
Fiscal policy groups like the Massachusetts Budget and Policy Center and the right-leaning Pioneer Institute argue Massachusetts' film tax credit is one of the most generous in the country and should be scaled back and allowed to expire to provide more funding for education, transportation and other needs.
"There is no evidence the tax credit can develop a permanent film production industry in the state, one that is not dependent on large tax subsidies to survive," the Massachusetts Budget and Policy Center said in a recent report on the tax subsidy. "What is certain is that the high cost of the tax credit limits our ability to invest in other programs with proven track records to build more broadly-shared prosperity in the state."
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at email@example.com.
Top recipients of Massachusetts film tax credits:
"Ghostbusters" (2016) - $26,702,552 (in tax credits)
"RIPD" - $26,597,083
"Grown Ups II" - $24,176,060
"I Hate You Dad" - $16,594,256
"Patriots Day" - $15,738,698
"The Finest Hours" - $14,408,518
"Black Mass" - $12,041,344
"Central Intelligence" - $11,306,562
"Ted" - $9,088,384
"What's Your Number?" - $5,360,552
Source: Massachusetts Department of Revenue