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Turning the discussion to substantive issues
Susana Martinez (left, courtesy photo) and Diane Denish (photo by Heath Haussamen)
Substantive discussion of the issues has thus far taken a backseat to negative campaigning in the governor’s race. It doesn’t appear that the campaigns are going to change that: Democrat Diane Denish rejected Republican Susana Martinez’s truce offer last month, and Denish and Martinez continued their sparring on Wednesday.
Sure, there has been some substantive policy talk. Denish has done more of it, releasing plans for ethics reform, helping small businesses, workforce development and government reform. While Martinez hasn’t released similarly detailed plans on most issues, she authored a fairly detailed guest column on this site about how she intends to grow jobs.
But Martinez has also failed to answer at least two policy questions asked by journalists that Denish did answer, about a situation involving Helena Chemical Company’s facility in Mesquite and the Public Regulation Commission’s authority over insurance rate hikes.
Both candidates have sections on the issues on their campaign Web sites (Martinez here and Denish here), but both have distracted themselves and voters with tit-for-tat sparring.
Starting today, NMPolitics.net intends to regularly publish statements from both gubernatorial candidates on specific policy issues in an attempt to nail them down on their views and turn the discussion to more substantive matters. Look for a post every week or two on a serious policy question.
I told the candidates I would place no word minimum or limit on their responses to questions. I want them to have the space they need to say what they have to say.
The film-incentive program
This week, I asked the candidates about the state’s film incentive program. The question:
“What is your opinion of the state’s film incentive program – the tax rebates and loans offered to companies to film movies and TV shows in New Mexico? Would you, as governor, seek to continue the program in its current form, make changes to it, or end it altogether, and why? If you would make changes, what would they be?”
The answers, first from Denish:
“I believe every tax credit issued by the state should be scrutinized on the basis of whether it’s creating jobs – and the film incentive is one that has done just that, with more than 10,000 jobs created in the state and $320 million in direct economic activity here in New Mexico. These are dollars that are turning around in our community – restaurants, hotels, suppliers, and, most important, high-skilled crews trained right here at home.
“During these difficult economic times, we should be investing in new, clean industries, especially ones that have allowed us to create a skilled workforce. I support a strong film-incentive program that has a strong audit process to ensure these dollars are being spent wisely and New Mexico jobs are being created.
“I would push for more production work to be carried out in rural parts of the state so that all communities can feel the direct benefit of this program. Finally, I would continue to push for post-production facilities so the entire filmmaking process could be completed here in New Mexico. Now is not the time to turn away from incentives that have a track record of creating jobs and developing important skills in our workforce.”
Second, from Martinez campaign spokesman Adam Deguire:
“Last year, the state faced a budget deficit close to $600 million, while at the same time spending over $76 million on film incentives. Economic development is a very important issue to New Mexicans, especially in these financially difficult times. Susana supports efforts to bring the film industry to New Mexico, but she believes we must do a better job ensuring these incentives are truly helping the economy.
“Susana is concerned with the conflicting data provided by the Richardson/Denish Administration and, if elected, will order an independent economic review of these incentives to ensure New Mexicans are getting an adequate return on investment. A study of the entire tax system must be undertaken to ensure that we create an environment that allows for long-term growth and lower taxes to help all small businesses, which are the backbone of our economy.”
One difference in their statements – Denish talking about the jobs created and Martinez talking about “conflicting data” – is due to the fact that there has been debate over the success of the program based on two different studies. You can read more about that debate here, here and here.
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Ms. Koch,
I have enjoyed the spirited dialogue. The older I get the more I know I don’t know. It is always a pleasure to learn something new. Thanks for your information.
Dear MJM,
The truth is we are probably more aligned than you think. And you might actually want to talk to me about how much I do know about the ins and outs of the film business in New Mexico. Just to be clear my first post was about separating the argument for the incentive program and the loan program. I agree the loan program needs to go and has been a corporate give away.
Ms. Koch. Please re-read my comment. A closer look will show you that I am not in favor of government welfare. Perhaps your business needs such a boost to survive. I would not count on this in the future, and perhaps you might consider other employment which is not dependant on corporate welfare. For the record, I have spoken to several individuals involved in the industry, including laborers, writers etc and also reviewed the cost benefit analysis of the industry done by two groups. One hired by the state, the other a conservative think tank. Very recently, I have been down to visit the Studios at Mesa Del Sol and listened to individuals from the State of NM who promote the movie industry. I have also looked at State investments in movies and rates of return on these investments. Have you done any research like this?
Here are the facts as I see them. The studios at Mesa del Sol are not doing well. Some movies and other shows are filmed here in NM, but you would have to admit that the more technical side of the industry is done out of state. Our employment in the industry is probably about 4,000, and most of that is part time.
As for making money, I try to do so without having to rely on tax payer support in the private sector.
MJM
If you want to argue against corporate welfare fine but please inform yourself. New Mexico offers SO many incentives to OUTSIDE corporations doing business here. The film business is but a small slice. In fact, it is more advantageous for a New Mexican based company like mine to set up a corporation outside the state for tax purposes. If you think Intel, Eclipse, and all those using Solar Tax credit, Energy Conservation and Management tax credits, the Manufacturer’s Investment Tax Credit, New Markets Tax Credit, Rural Jobs Tax Credit, Technology Jobs Tax Credit, Angel Investment Tax Credit should loose their incentives too it’s a different argument.
What do you do to make money?
To support the film industry this way is a poor economic decision. Why don’t we give this type of corporate welfare to all New Mexico businesses? The reason of course, is because it makes no economic sense. The film industry is nothing special, but they think they are..
The assumption that 10,000 individuals are employed here is a stretch. Probably more like 4,000 fte’s
While we have supported some area of the film production business, the more creative portions of the business such as writers, and technical film support are lacking. So NM does not have the total package.
Some states such as Wisconsin have reduced their corporate welfare to the film industry. It does not seem to have reduced film industry activity in that state. Why not cut the welfare payments and see if the industry can survive. Novel concept eh.
It is reasonable time to re-evaluate the film incentive programs, the 25% tax rebate and interest deferred loan program to clear the perceived notion that it is bad because Richardson embraced it. It should stop being a political issue and be evaluated for it’s economic power.
I am a film producer living and working in New Mexico and flummoxed by the misinformation and misconceptions attributed to these film incentives. There is opportunity to know the facts but for political reasons both the press and our legislatures continue to ignore the truth.
FIFTY states now offer some kind of film incentives. New Mexico, with its 25% tax rebate, is no longer the leader. It is a film BUSINESS. Producers must maximize all avenues available to lower production costs. 9 times out of 10, cost will outweigh any creative decision. If it’s cheaper to make Michigan look like the old west due to their 40% incentive than it is in New Mexico with our 25% rebate, the choice will be Michigan.
New Mexico’s rebate is one of the most sustainable models out there – it is NOT a rebate ON the AMOUNT SPENT (as in other states) but ONLY on expenses that are subject to INCOME OR GROSS RECEIPTS taxes ALREADY.
Therefore, New Mexico’s model will last where other states may not. We are considered a poster child for how to do it right.
Shooting in southern New Mexico will happen when it is cheaper to do so. If there is any tweaking to be done with the rebate to make the politician outside the Albuquerque and Santa Fe corridor more supportive, consider offering an additional rebate if a company shoots outside that corridor.
New Mexico’s State Investment Council deferred interest loan program may have kick-started activity in the early days but it no longer serves a purpose and should be abolished.
It is fool hearty to think that any production company will decide to shoot in New Mexico if we do away with the rebate. And, when it is in question each legislative session it creates risk in the minds of companies considering shooting here.
Health, Could you try for spontaneous replies from Denish and Martinez on your questions? Getting press release type quotes from Martinez campaign spokesman Adam Deguire are nothing more then quotes that have been bounced around staff till they sound just right.
Regarding Film tax credits we should follow the lead of the Michigan State Legislature. Read the attached:
http://www.livingstondaily.com/article/20100701/NEWS01/7010316
This never happens, but I will say this time I agree with Chad MacQuigg. Filming a short video with a cell-camera is easy, takes a small amount of time, and will be much more interesting to constituents than 2-3 paragraph press statements which will always be short and bereft of facts. At least with a film you get a chance to see whether or not they actually care about the situation.
Short of that, excellent job Heath. the negative stuff works for elections, but is bad for policy and that is exactly what either of these two candidates will be faced with should they become governor. Please, keep it up and be as specific as possible.
I am deeply concerned about our New Mexico Film Credit Program and believe it should be audited for possible abuses. It would be reassuring that our program is working unlike that in Iowa.
A report by an independent consultant that reviewed the abusive and mismanaged spending by the Iowa Film Office, which is part of the Iowa Department of Economic Development. State Auditor should read the Iowa report.
The audit found that nearly half of tax incentives designed to encourage filmmakers to come to Iowa and hire local companies had actually gone to out-of-state individuals and businesses.
The inquiry by accounting firm Clifton Gunderson also found that directors, producers and actors who shouldn’t have qualified for tax credits claimed them for other production work, costing up to $650,000 on one project alone.
So how true is this of the New Mexico tax credit program where there is no monitoring of this program. We should do an independent audit ASAP. We have cut millions for infrastructure projects that would have create real New Mexican jobs. Yet we are throwing millions at the film incentive program without any concrete evidence it is creating jobs – unbelievable. Where is the money going? We should cap the the program for at least one year during this economic crisis. It will help balance the budget!
Heath,
I would ask that you expand your offer to the candidates. Include the opportunity for them to record an audio and/or video response to your questions, in order that we can see them inaction, rather than just reading a response (which may not have been even written by them, but rather for them).
Thank you for taking on this most important responsibility – perhaps now we can finally focus upon issues that really do interest voters.
Southern New Mexico has an active film production community that is regularly left out of the opportunities relating to upcoming film production. Diane Denish recognizes that the southern part of the state has the talent and capabilities in film production and needs to be afforded the same opportunities as Albuquerque and Santa Fe film production firms. Denish’s response to the policy question shows that she has heard the southern New Mexico film industry constituents’ concerns and when she becomes Governor this will bode well for our part of the state. It is no surprise that economists in this state can’t agree on the impact of the film tax incentive, given that economists tracking the national status of our economy also do not agree on most issues.
Thank you Heath for bringing the issues to the forefront. This type of information will truly help voters see who is more experienced and understanding of statewide issues and how to move forward in addressing our states pressing needs.
Even before I read Martinez’s response, I was going to suggest that you require respondents to document their responses where possible. As you note, there are conflicting studies on the benefits of the film incentive program.