NM's film credit backlog reaches $382M - Albuquerque Journal

NM’s film credit backlog reaches $382M

Ralph Ineson as “The Man in Black” in “The Ballad of Buster Scruggs,” which was filmed at Santa Fe Studios. (Courtesy of Netflix)

Copyright © 2019 Albuquerque Journal

The latest figure for paying off the backlog of rebates for movies and TV shows filmed in New Mexico through the end of the current year now stands at $382 million.

That number, released in a report by the New Mexico State Film Office, takes into account productions that have not yet submitted financial paperwork and those productions that have not yet started filming in New Mexico. The report helps explain the different amounts that have been mentioned in public statements, and breaks them down into three categories.

According to the document: “After extensive data collection and input that was not captured and presented during the past administration, NMFO, TRD (Tax and Revenue Department) and EDD (Economic Development Department) have found the backlog of submitted projects to be $198,285,562.”

In addition, the New Mexico Film Office compiled information on the total film production costs that have not yet been submitted to Tax and Revenue. That amount is $130.5 million.

The Film Office also compiled projections for films it believes will still come in during fiscal year 2019, which ends on June 30. That amount is $53.6 million.

Nicole Montoya allows JB Letuli, an EFX makeup and costume designer with OnSet FX, to transform her into a swamp witch at the Roundhouse as part of Film and Media Day. (Eddie Moore/Albuquerque Journal)

To deal with the backlog, Gov. Michelle Lujan Grisham is supporting a bill – Senate Bill 2 – that would remove the current $50 million cap on what can be paid out to film/TV productions in a single year. She also favors a one-time payment to cover the entire backlog.

But the $7 billion budget bill passed by the House, which is now pending in the Senate, assumes a one-time payment of $150 million to reduce the film backlog, though that number could be changed moving forward.

The legislation is sponsored by Sen. Nancy Rodriguez, D-Santa Fe.

The bill also would tighten the law regarding which expenditures qualify for film rebates, while requiring movies and TV shows filmed in New Mexico to provide greater acknowledgment of the state in their credits.

One other important note – according to Alicia J. Keyes, secretary designate of Economic Development – is that the bill will help put more transparency between the Department of Taxation and Revenue and the state Film Office. In the past, the departments would have different data regarding various TV/film productions.

“A lot of the data wasn’t kept properly (by the state Film Office),” Keyes said. “We are correcting the process so that we will have more transparency between the two departments. We have an economist in the department that will be overseeing all of the information within film and TV.”

Currently, film companies receive a 25 percent rebate on expenses for most projects in New Mexico and up to a 30 percent rebate for some TV shows.

Keyes said that streamlining the process between tax and revenue and the Film Office will strengthen the state’s ability to crack down on residency issues.

“That’s a big thing for us,” she said. “It will also eliminate any kind of pass-throughs.”

Spencer Locke as Amberley Snyder in the Netflix film “Walk. Ride. Rodeo.” (Courtesy of Greg Peters/Netflix)

A pass-through entity is a special business structure that is used to reduce the effects of double taxation. Pass-through entities don’t pay income taxes at the corporate level. Instead, corporate income is allocated among the owners and income taxes are levied only at the individual owners’ level.

According to the state Film Office report, since 2003 the film industry has brought in $3.44 billion to the state.

“(This is) money that would not have been in the state’s economy otherwise,” said Keyes. “It’s the jobs that keeping coming in. The film industry pay is roughly 42 percent more, say, if you were a regular electrician. And you get benefits.”

According to the report, the legislation was crafted to incentivize productions to use local crew, support services and vendors.

However, not all direct production spending qualifies for the tax credit.

During fiscal year 2017, the direct spend in New Mexico from the film industry was about $464.6 million. Expenditures that qualified for a rebate stood at $324 million, which left $140.4 million as the portion that did not qualify for rebates.

The Film Office has also tried to spread the film projects throughout the state.

Keyes says that while the Albuquerque/Santa Fe corridor is the epicenter of production, many rural areas have seen substantial production spending.

“In 2017 alone, 40 rural communities had film or television in their areas and millions of dollars spent in the local economies,” according to the report.

Wesley Young of Raks Building Supply said one positive aspect of the film industry is that it is virtually recession proof.

“In 2006, the film industry helped fill the hole in our business,” Young said.

Schimmel Security has also benefited from the film industry over the past five years.

“Approximately 90 percent of our business is related to the film industry,” Joseph Schimmel said. “Our work in film and TV has allowed us to hire a sizable work staff (of) over 150 people.”

The report also notes that the film industry provides opportunities for students to find high-wage jobs with benefits without having to leave the state.

“Today, there are 23 film, television and or media programs offered in New Mexico,” according to the report.

If Senate Bill 2 is passed and the cap is removed, New Mexico will join Georgia and Illinois as the states without a cap for the film industry.

Home » Entertainment » Local Movie News » NM’s film credit backlog reaches $382M

Insert Question Legislature form in Legis only stories

Albuquerque Journal and its reporters are committed to telling the stories of our community.

• Do you have a question you want someone to try to answer for you? Do you have a bright spot you want to share?
   We want to hear from you. Please email yourstory@abqjournal.com

taboola desktop

ABQjournal can get you answers in all pages


Questions about the Legislature?
Albuquerque Journal can get you answers
Email addresses are used solely for verification and to speed the verification process for repeat questioners.
Police ID man shot in foot by officers during ...
ABQnews Seeker
Police have identified the armed man ... Police have identified the armed man who officers shot at — putting a bullet in his foot — before using a Taser to detain ...
New Mexico has a sweeping new election law. Here ...
ABQnews Seeker
Legislation signed into law Thursday makes ... Legislation signed into law Thursday makes a host of changes intended to protect Native American voting rights in New Mexico. But it will also ...
Flix Brewhouse video shows man entering theater kitchen with ...
ABQnews Seeker
Security video from Flix Brewhouse last ... Security video from Flix Brewhouse last week shows a man carrying a firearm into the theater's kitchen, where employees confront him and wrestle the ...
Rodents, roaches and reoffenders: Five Albuquerque restaurants in the ...
ABQnews Seeker
Three Albuquerque restaurants were downgraded, and ... Three Albuquerque restaurants were downgraded, and two were forced to close until they passed their follow-up inspections.
What happened to the giant crane at Rio Rancho's ...
ABQnews Seeker
How closely did you follow the ... How closely did you follow the New Mexico news this week? Test your knowledge with our weekly quiz!
Chef's kiss: 6 for-sale Albuquerque-area houses under $500K with ...
ABQnews Seeker
Check out these six houses with ... Check out these six houses with chef's kitchens on the market for under $500K in the Albuquerque area
Police shoot at armed man following domestic dispute in ...
ABQnews Seeker
Officers responding to a domestic dispute ... Officers responding to a domestic dispute tried to shoot an armed man before detaining him by other means Wednesday night near West Central, according ...
Homeless families get six months more in county-funded hotel
ABQnews Seeker
The Bernalillo County Commission on Tuesday ... The Bernalillo County Commission on Tuesday approved spending another $740,260 to continue renting space at an undisclosed local hotel through Sept. 30.
Happy times on the coast as San Diego State ...
ABQnews Seeker
The number of San Diego State ... The number of San Diego State teams that have won an NCAA Division I championship can be counted on one finger. Many Aztecs fans ...