Spending on film and television productions in Louisiana rebounded in 2017, nearly doubling from the year before, as the industry emerged from a free-fall following changes to the state’s controversial film tax incentive program.
Officials point to a new round of changes made last year at the Legislature to explain the activity uptick. Producers spent an estimated $668 million in the state in 2017, up from $365 million the year before but far less than the billion-dollar-plus levels of the program’s peak.
The rebound indicates the film industry can survive here—in some form—without unfettered access to tax incentives; Gov. John Bel Edwards has eschewed a “bidding war”-type atmosphere, even as states like Georgia fully embrace the tax breaks for producers. Louisiana now has a $150 million-a-year cap on credits it will issue—among other controls on the program—and has a project cap of $20 million for most productions.
“I think what the governor had tasked us to do and what we were able to accomplish with the new legislation is that we have to operate within a budget,” says Chris Stelly, executive director of Louisiana Entertainment, a division of Louisiana Economic Development. “However, $150 million is a significant amount for the program.”
The program has been in the crosshairs of some lawmakers in recent years as the state weathers repeated budget shortfalls. A state-sanctioned study of the program last year found Louisiana’s budget took a $219 million hit in 2016 from the film program, even after factoring in taxes generated from productions. State officials, in response, point to the economic activity generated by the productions that is not included in the low return on investment, though the author of that study pointed out film subsidies are inherently generous and costly.
The state handed out $111.7 million in tax credits last year. That number likely reflects the downturn from a year prior, as officials say there is typically a 12-to-24 month lag time between production spending and the issuance of credits.
But the Louisiana industry also appears to be entering a new era that is more focused on television productions and smaller, independent filmmaking—and away from the big-ticket tentpole productions that gave Hollywood South its spark.
“I think everybody’s in agreement because of the caps in place per project, we’re never going to be as busy as we were at our busiest,” says Aaron Bayham, director of studio operations at Celtic Studios in Baton Rouge. “What we do think will happen is we’ll have an indigenous filmmaking community that will continue to grow, and we’ll continue to attract some decent size projects.”
Celtic has yet to reap the benefits felt statewide last year, when estimated spending on film and TV nearly doubled; Baton Rouge’s flagship studio was still reeling from the 2015 changes, which “decimated” the industry. But Bayham says he’s had some interest from producers this year and hopes the tides will turn in the coming months.
The statewide downturn felt in 2016 was even more acute in Baton Rouge, as spending fell 93% locally. But with new incentives for filmmakers to shoot in places outside of New Orleans, Baton Rouge Film Commission director Katie Pryor says the city is positioned to grab more production moving forward.
Greyhound, a WWII film featuring Tom Hanks, has brought a $50 million budget to Baton Rouge, and is the largest project yet to take advantage of the non-New Orleans film incentive. Still, the estimated spending locally is still far lower than its peak levels in previous years.
“We’ve been spreading the word that we’re back in the market, back in the show,” Pryor says. “All the conversations are going in the right direction.”
