As part of Gov. Bobby Jindal’s sweeping tax proposal expected to be introduced in the 2013 legislative session, the Louisiana Film Incentive and Tax Credit program may be reduced. Under Jindal’s plan, the 30 percent tax credit would no longer be applied to actor’s salaries over the amount of $1 million.
For Quixote Studios, who is finalizing construction on the largest soundstage in the region in St. Rose, this is bad news.
Quixote Studios CEO Mikel Elliot said if the tax credit is reduced it would undoubtedly mean fewer productions for the state and St. Charles Parish.
“We’re building a studio that should get first call in Louisiana, but everybody is going to pull back on infrastructure and that is part of the problem,” he said. “If that credit is no longer applied, I may pull back some of the sizzle and spend 20 percent less.”
Quixote Studios chose to build in St. Rose because it provided better access to both New Orleans and the surrounding area. Elliot’s original plan was to build four sound stages at a cost of around $15 million, but he said without the full tax incentive his plans will likely change.
The construction of Quixote Studios’ facility is currently at 30,000 square feet, but plans are to expand to 90,000 square feet in the future.
“We would pull back on our plans overall for studio and design,” he said.
Corey Faucheux, director of Economic Development and Tourism for the parish, said Quixote Studios would be an economic stimulus for the peripheral businesses associated with the site.
“It runs the whole gamut from carpenters to build sets, lighting folks, trucks – there are fingers in this industry that reach it into many trades. We are hoping this not only impacts fulltime Quixote employees, but also these other trades,” Faucheux said. “This also has a local spill over into our restaurants, coffee shops, hardware stores – it all spills over.”
Elliot said the plan would not only have a negative effect on Quixote Studios’ ability to draw in productions, but on the future of the area immediately surrounding the studio.
“If the credit stays in place, I keep building and the whole area gets developed. It’s more than just the production, it’s the smaller businesses as well,” he said.
Quixote Studios has experienced political setbacks in other states with tax incentives as well. At their Boston studio, Elliot said productions decided not to use his studio due to political uncertainty.
“In Boston I have a studio and when there was some uncertainty if the tax credit was going to get renewed it caused a lot of people to pull back. There was a year of uncertainty,” Elliot said.
Elliot would not be surprised to see a similar reaction over the next few months as Jindal’s tax plan is hammered out.
In fact, he said he could even see some productions that were planning on using Louisiana as a base move to more secure states that also offer tax credits, such as Georgia.
“I think Georgia is coming on hard,” Elliot said. “Stuff that is going to Louisiana could easily go that way, but Louisiana has so far proven to be a good place. You don’t want to give that up to Georgia.”
Elliot said he hopes the governor reconsiders rolling back the tax credit.
“It’s a huge deal. We are looking to employ a few more people there and it could cost some jobs,” he said.
Since the tax credit was first introduced in Louisiana in 2002, the state has hosted the production of hundreds of film and TV projects, including 141 in 2011 alone. That led to Louisiana earning the nickname of “Hollywood South.”
Several of those projects filmed in St. Charles Parish.
Film New Orleans, a part of the New Orleans Mayor’s Office of Cultural Economy, found that $1.3 billion was spent in Louisiana just in 2011 due to film and TV productions lured by the tax credit.
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