ALBUQUERQUE, N.M. - Supporters of New Mexico's burgeoning film industry breathed a sigh of relief Thursday as legislation aimed at wiping out tax incentives and restructuring a state loan program for film projects was stalled by a House committee.
The Labor and Human Resources Committee was the first stop for the bill, which had generated much opposition since being introduced by Rep. Dennis Kintigh, R-Roswell. The committee voted 5-4 to table the bill after hearing from a crowded room of supporters who argued that New Mexico's film incentives have resulted in thousands of new jobs, new opportunities for small businesses and educational programs for New Mexico students.
With the committee's decision, there's little hope for Kintigh's bill. However, the debate over the merits and costs of the film incentives will continue as lawmakers grapple with a suggestion by Gov. Susana Martinez to reduce the rebate on film expenditures from 25 percent to 15 percent. The governor estimates that would save $25 million and help the state plug a budget shortfall next year.
Kintigh told the committee Thursday that the film subsidies aren't good policy for New Mexico and that the millions of dollars paid out each year to the film industry would be better spent on teachers, public safety and health care. He pointed to studies done in New Mexico and elsewhere that question whether the return on the investment in the industry has been worth it.
New Mexico has paid out $180 million to film companies over the past three years as part of the tax incentives, Kintigh said.
"We're in a world of hurt. We can't continue to shell out these tax dollars," he said.
The actors, filmmakers, studio executives, small business owners and travel agents who filled the audience argued that if lawmakers were to end or even reduce the incentive program, New Mexico would be crossed off Hollywood's list and productions would start looking to other states. About 40 states offer some type of tax incentives or other assistance to filmmakers, some more lucrative than what New Mexico offers.
Supporters also talked about the notoriety that New Mexico has gained thanks to films such as "True Grit" being filmed in the state.
Committee chairman Rep. Miguel Garcia said he has seen the industry's impact in his own district in Albuquerque's South Valley. The Democratic lawmaker said he sees a film crew almost every month working, eating at restaurants and buying from local shops.
Garcia's son has even found work as an extra after being laid off from his call center job, and he said construction workers left idle by the housing bust have found jobs building sets.
Rep. Sheryl Williams Stapleton, D-Albuquerque, said she is concerned that doing away with the film incentives would result in more New Mexicans being out of work.
The number of jobs created by the industry has been a point of contention. Supporters say the industry is responsible for some 10,000 jobs, while critics argue the number is only a fraction of that and most of the jobs are temporary.
Committee members acknowledged that the debate has been emotional, but Kintigh said lawmakers need to be asking tough questions to ensure that taxpayers' money is being spent wisely.
"We all have lots of questions about this and that's a good thing," he said. "We want to see this discussion continued."
Rep. Candy Spence Ezzell, R-Roswell, said lawmakers are bound by the state Constitution to have a balanced budget.
"Ladies and gentlemen, we have to tighten our belt in the state of New Mexico. We have to get the budget under control. It's hurting all of us," she said. Then looking at the audience, she said: "Everybody is going to have to take a hit. Don't be so set in cement that you're not willing to compromise."
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