Nearly everyone likes the idea of having a movie filmed in their backyard. But don’t assume that the production is bringing lots of money into the state.
South Carolina offers film companies generous incentives to make movies and TV shows in the state. Filmmakers can collect a 15 percent rebate on whatever the company spends on wages and supplies purchased in South Carolina.
Now, however, a bill has been introduced in the state Senate to increase those rebates to 30 percent for supplies and 20 percent for wages – and even more, 25 percent, if the company hires a state resident. The bill has been approved by the Senate Finance Committee and now heads to the Senate floor for debate.
There are some conditions. Film companies would be eligible for the rebates only if they spend $1 million or more. And the state would offer the rebates only for as long as it has the money to spend.
But last year, lawmakers set aside $10 million for the wage rebates and spent about $6 million, a sizable investment. From 2007 to 2011, South Carolina paid rebates to nine film productions, including “Army Wives,” the drama series on the Lifetime network, filmed in Charleston, that now is entering its seventh season.
Gov. Nikki Haley, for one, is skeptical of tax incentives to lure business to the state, and that includes money for movies. She said that if rebates are increased, the projects should be considered on a case-by-case basis.
We think her skepticism is well founded. For one thing, South Carolina is competing against much of the rest of the nation to attract film projects, which means that movie producers can cherry pick the best deals.
There are currently 44 states, plus Washington, D.C., that offer some type of move production incentive. States offered $1.3 billion in incentives in 2011.
But the benefits of these investments often are hard to measure. While movies can be extremely expensive to make, much of the money goes to actors and crews from out of state, namely from Hollywood or New York City.
Subsidies also can reward companies for productions that they might have done in the state anyway. It’s icing on the cake rather than a real incentive to move the production to a particular state.
And one movie rarely spawns an industry. York and Chester county residents enjoyed having the movie “The Patriot” filmed here, but any economic impact vanished shortly after the filmmakers packed up and went home.
Having movies or TV shows made in South Carolina is not necessarily detrimental. Even a one-time production can boost the local economy, create jobs (though often temporary) and produce publicity for the state.
A state paid $21 million in film incentives from 2007 to 2011, and the film industry generated $86.9 million in sales for state businesses, according to a report by the state Department of Parks, Recreation and Tourism. But such reports are notoriously inflated, and drawing a direct line between incentives and revenues is difficult.
In addition, the money for taxpayer-subsidized movies could be spent instead on road repairs or education. Lawmakers need to evaluate which will benefit the state more over the long run.
As Gov. Haley notes, each project should be evaluated on its potential to generate economic activity in the state. And we shouldn’t let stardust cloud our vision.