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The value, cost of the pride factor

Senate President Thomas V. Mike Miller Jr. describes himself as a fan of two political shows filmed in Maryland but wonders if the state can continue to afford offering the tax credits that keep the shows in the state.

“I love the show,” said Miller, speaking of House of Cards which films in and around the Baltimore metro area and will begin its third season on Netflix in February. “I’d like there to be a season four and a season five, all filmed in the state of Maryland. ”

“I enjoy Veep,” Miller said of the HBO comedy series staring Julia Louis-Dreyfus. “I’m not a television watcher. I go home and I read books every night but occasionally I watch television and several times I watched (Veep).”

Miller made his comments at the same time that budget analysts have issued an evaluation of the state film tax credit and called for legislators to eliminate the program that is set to expire in 2016.

Since fiscal 2012, the state has spend nearly $63 million on the credit—about 97 percent of what was spent has gone to House of Cards, which stars Kevin Spacey, and Veep. But returns on the states investment have been thin.

The state receives a return of only 6 cents on every tax credit dollar spent and local governments receive about 4 cents, leading budget analysts to conclude that the “credit does not pay for itself.”

“Since the credit does not provide sustainable economic development and provides a small return on investment to the state and local government, DLS recommends that the General Assembly allow the film production activity tax credit to sunset as scheduled on July, 2016,” according to the report on the tax credit.

Miller acknowledge the legitimacy of the debate over the cost of the program but said there are other considerations that need to be taken into account before writing off the program and sending the shows of to another state.

“I think they are good pluses for the state but it’s going to be up to the fiscal committees to determine the merits of how much the state is willing to put forward,” Miller said. “The problem is we’re in a bidding war with our sister states. All of them would love to have these shows in their states. So, the question is: Is there a certain amount of pride that comes with having these productions in the state of Maryland.

“It’s hard to measure worth just in terms of dollars and sense and employment factor,” Miller said. “The people handling the grips and the crews and the actors that come from Maryland. It’s a debate that the General Assembly is going to continue to have.”

About three dozen other states have similar incentives. Last year, the production company that films House of Cards told state legislators they would move out of Maryland if the credit were not increased. Spacey himself lobbied legislators at a private function at an Annapolis wine bar.

Miller compared keeping the programs filming in the state to the desire to keep a football and baseball stadium complex in Baltimore.

“There are those that say putting a ballpark, a Ravens stadium and a baseball stadium in downtown Baltimore didn’t make any sense, that they should be on I-95 so that you can have folks in the Virginia area and the Washington DC area and Baltimore all come together to support these two teams,” Miller said. “They’d be the richest teams in the whole United States because of the money on the east coast. But William Donald Schaefer said…there’s a certain element to having the two teams located in downtown Baltimore even though it meant that a new baseball team would be opening in Washington DC at some time in the future. But he wanted that (stadium) there because it was an element of pride. ”

But the pride factor may not be enough.

“I support the production of the films,” Miller said. “I support these particular shows in the state of Maryland. It’s a question of can we afford them?”

One comment

  1. The answer to Senator Miller’s question is obvious. Government has no authority to spend public funds, whether in the form of cash outlay or “tax credits,” for intangibles. This is true whether we are discussing movie/TV productions, sports teams, or horse racing.

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