With all due apologies to song master Frederick Loewe, singer Rex Harrison and “My Fair Lady” itself ...
We have grown quite accustomed to the tune that Dawn Keezer whistles night and noon, not to forget her smiles and frowns, when it comes to shilling for taxpayers to underwrite Hollywood productions in the erstwhile Steel City.
And the director of the Pittsburgh Film Office (PFO) was whistling morning, noon and night recently about all the production companies looking to shoot locally and the supposedly manifest benefits of further raising the state’s Film-Production Tax Credit to attract more, more, more productions to the area.
But as we’ve repeatedly noted – as recently as June 11 – increasing the film tax credit, or offering any credit at all, should be a non-starter and not a no-brainer.
Keezer yet again is arguing for a higher cap on the state tax credit given to production companies, from $70 million to $125 million. That’s an 80% hike.
“There’s lots of interest. There’s lots of people scouting,” Keezer said. “That’s why we desperately need an increase in the film tax credit, because Pennsylvania is looking at $1 billion worth of work that wants to be here. It’s a huge testament to the industry we’ve built.”
Keezer’s Pittsburgh Film Office claims that increasing the incentive would bring in more film projects and stimulate the local economy through jobs and support for local businesses “at a time when it’s desperately needed as people are bouncing back from COVID.”
Never let a crisis go to waste in the pursuit of fleecing taxpayers.
The PFO claims an economic impact of more than $1.5 billion in regional economic benefits since her office was created 31 years ago. Raising the credit cap would make the commonwealth more competitive and make it easier to secure that $1 billion worth of productions that want to film here, she told the newspaper.
But as we noted less than two weeks ago, a 2018 state Independent Fiscal Office (IFO) analysis found that the film tax credit generated a paltry “return” of 13.1 cents for every tax credit dollar.
IFO principal revenue analyst Stacey Knavel says perhaps the money could be better spent elsewhere, say, on education and/or infrastructure.
Additionally, public policy researchers Pat Garofalo and Michael LaFaive in Michigan just this month exposed film tax credits for the corporate wealthfare and tax dollar waste they are.
“Call it the latest entry in the fantasy genre,” the researchers reminded. “As states look to bounce back from the economic damage of the coronavirus pandemic, many are considering new or expanded tax credits for movie production.”
While the hope is that taxpayer subsidies will lure big-budget blockbusters and good-paying jobs, “such blatant corporate welfare has failed virtually everywhere it has been tried. It would be a comedy – if millions of dollars in taxpayer money weren’t on the line,” Garofalo and LaFaive concluded.
Those who promote self-serving public policy indeed employ their repetitive spiel hoping that the more they assert something, the more likely it is that the public will accept it as an article of faith.
But even if the public has grown accustomed to the tune Dawn Keezer keeps whistling night and noon, the facts prove otherwise.
And the fact remains that lowering taxes for all – instead of attempting to give special interests special tax breaks – would serve the tax-paying public and the economy far better.
That should be as second nature to public policy makers, as “My Fair Lady’s” Frederick Loewe also reminded, “as breathing out and breathing in.”
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (firstname.lastname@example.org).