One of Georgia’s top competitors in the arms race to land Hollywood movies and television series may put down its weapons.
North Carolina — home to “Iron Man 3” and Showtime’s “Homeland” — could allow its incentive program to expire at the end of next year. It would be a stunning reversal in the battle for megawatt movies and TV programs by a state that helped pioneer incentives to lure business.
Though some Georgia leaders salivate at the thought that more filming could come south, North Carolina’s potential move also raises questions whether the incentives are as good as advertised for other states — including Georgia.
Gov. Nathan Deal and others have praised film incentives for creating jobs and bringing investment here, but many Tar Heel state lawmakers say they aren’t worth the cost.
“The only people that win are the movie people,” said Sen. Bob Rucho, co-chairman of the North Carolina Senate’s Finance Committee and a critic of film incentives.
Republicans in North Carolina, who now control the executive and legislative branches for the first time since Reconstruction, passed a new two-year budget with tax reforms that would end many incentives and loopholes, including ones for Hollywood.
They argue lower tax rates for all residents and businesses will would do more to prime the state economy.
North Carolina’s move could send production business to Georgia, said Virginia Bonner, a film studies professor at Clayton State University.
“Georgia is picking up steam with (the movie industry) and has been running with it for a while,” Bonner said. She called North Carolina’s potential move “bad” for that state’s movie business.
North Carolina offers a 25 percent “refundable” tax credit for production spending in the state. The program basically works like a rebate system for 25 percent of qualified North Carolina spending that comes straight from the general fund. The tab to North Carolina taxpayers was about $70 million for 2012.
The North Carolina Film Office says the film and television business accounts for 4,000 jobs in the state, not including indirect jobs. Hollywood spent $376 million on productions in the state last year.
Some policy groups on both ends of the political spectrum have criticized such incentives and job claims. Critics say few permanent jobs are produced and the highest paying ones go to actors and others who live out of state. The perks, critics say, benefit a revenue-rich business that has little loyalty once incentives dry up.
In 2010, states spent about $1.5 billion in incentives for the film and television industry, according to the Tax Foundation, a right-leaning tax policy group in Washington, D.C. About 40 states nationwide offer such incentives.
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