Full text of Martinez’s speech

Comments

  1. Michael L Hays says:

    I have a little trouble with the following passage from the Governor’s speech because it seems self-contradictory:

    “That’s why I propose reducing the state’s film subsidy from 25 percent to 15 percent, which is where it first started.

    “This has been incorrectly referred to as a tax credit. It has nothing to do with taxes.

    “The way it works is when a film is made in the state, New Mexico taxpayers cover 25 percent of the costs.”

    Excuse me, Governor, it may be a subsidy, not a tax credit, as you say. Whatever it is called and however it works, it is a wealth transfer of public funds to private coffers. To say that whatever it is “has nothing to do with taxes” is an astonishing statement; where does the money come from if not from taxes? Oh, I see, “New Mexico taxpayers cover 25 percent of the costs.”

    My question is: did a committee of consultants write this speech before the Governor read it?

  2. jcfilmbuff says:

    According to a report by E&Y in 2009 the incentive has a positive return on investment, resulting in combined state and local tax collections of $1.50 for each $1.00 of state credits.

    In 2007, 30 films were produced in New Mexico generating $253 million of spending benefiting the New Mexico economy and generating higher state and local tax collections. Film production activities in New Mexico created 2,220 direct jobs in 2007. The employment impact included approximately 1,670 below the line employees earning $49,500 annually and 550 actors, directors, and producers working in New Mexico. These 2,220 direct jobs created 1,609 additional jobs in other industries, resulting in a total employment impact of 3,829 jobs.

    Film-related capital expenditures and projected film tourism spending attributable to 2007 productions generated an estimated 3,769 direct jobs and 1,612 indirect jobs, resulting in 5,380 total jobs attributable to capital expenditures and film tourism. Combining the 2,220 direct jobs from film productions with the 3,769 jobs from capital expenditures and film tourism results in 5,989 total direct jobs attributable to the film production tax credit. These direct jobs create a total of 3,221 indirect jobs, resulting in a total employment impact of nearly 9,210 jobs.

  3. jcfilmbuff says:

    The film and TV industry supports more than 2.4 million jobs and generates about $13 billion in taxes and $40 billion in payments to vendors, suppliers and others nationwide, and New Mexico has had a competitive film production incentive since 2002. The NM incentive is contained in the tax code and is obtained through a claim for a refund on a tax return, and is called a “refundable tax credit.”

    NM was one of the first states to recognize the importance of film production in domestic job creation, capital investment, job training, development of infrastructure, and promotion of tourism. The NM incentive has proven successful in keeping jobs and capital in the US. In fact, neighboring states are positioning themselves to capitalize on changes to the incentive that might lessen its appeal. A reduction in the rate from 25% to 15% would do just that.

    A 15% incentive rate, while competitive in 2002, is no longer competitive with the 40 odd US states with incentives and the ever-growing list of foreign countries seeking to lure this highly mobile, labor and capital intensive business. Once NM loses its competitive advantage, it will take a long time to regain its current position of importance as an appealing production location globally

  4. Michael L Hays says:

    The Governor’s second remark on education advocates a punitive grading system for schools. I defy her or her Secretary of Education, a woman with no education experience who means to implement a failing Floridian educational system touted by political ideologues, to explain what good can be done by stigmatizing entire institutions and their staffs. To justify such abuse by an appeal to “accountability” makes a mockery of accountability; it is really nothing more than the moral barbarism of collective punishment. Anger at and hostility toward public education are ill-concealed by this grading system.

    When the first flush of power fades and their failures to effect beneficial educational change become clear, then they must be held accountable. I shall use an enhanced grading system like theirs, one used when I went to school: grades for achievement ranged from A (excellent) to B (good) to C (average) to D (poor) to F (failure); for effort, from E (excellent) to S (satisfactory) to U (unsatisfactory).

  5. jcfilmbuff says:

    I question the accuracy of Governor Martinez’s statement that “Eight states have reduced, suspended or completely eliminated their film subsidies.” Also Governor Martinez’s reference to “Studies” which “found (incentives) too expensive for the few jobs they created” must be a reference to the report issued Nov. 17 by the Center on Budget and Policy Priorities. The report asserted that credits are “wasteful” and elitist because they reduce funding for services such as education, health care and police and fire protection. However in comparison, most other film incentive studies have reached the same conclusion: the benefit to the private economy far outweighs the public cost of the credit.

    It goes without saying; any reduction to the New Mexico incentive program will immediately result in a reduction of film and TV production in New Mexico.

  6. jcfilmbuff says:

    Governor Martinez is wise to evaluate the effectiveness of all incentives, including film incentives. It is critically important to ensure safeguards to prevent fraud and abuse. However the NM incentive program already has adequate safeguards, and the New Mexico Taxation and Revenue Department has disqualified claims for fraudulent expenses, denying the credit except as to those expenses permitted by law. If there are continued abuses, additional checks and balances are required to ensure NM taxpayers maximize their resources available for education and health care.

  7. Show Me says:

    Bold Change is pledging to give more big business tax breaks while cutting services to New Mexicans? These ever growing number of special interest tax breaks are a large part of what has wrecked our budget. I thought the Union Pacific deal to move to Santa Teresa was in the works for years. Now they need a tax break? I hope the media follows up on this to test the integrity and intellectual rigor of these so called “change” agents.