SANTA FE — A bill pushed by Gov. Michelle Lujan Grisham’s administration that would raise New Mexico’s annual cap on film incentive spending is picking up steam at the Roundhouse.
Senate Bill 2 passed the Senate on a 32-8 vote late Tuesday, just hours after passing its second Senate committee. It now advances to the House.
Despite the quick movement, some senators expressed misgivings.
“The new administration owns this product,” said Sen. John Arthur Smith, D-Deming, the committee’s chairman.
He also described the film incentive program as a “Santa Fe/Albuquerque film credit,” a criticism also leveled by other rural lawmakers.
In its original form, the legislation sponsored by Sen. Nancy Rodriguez, D-Santa Fe, would have removed the state’s annual $50 million cap on film rebate spending, which was signed into law in 2011.
But the bill has been significantly retooled, and it currently calls for the spending cap to remain in place but go up to $110 million per year.
In addition, it would authorize the one-time spending of up to $225 million over the next 16 months to pay down a backlog in film incentives that’s estimated to hit $382 million by the end of this year.
Going forward, the measure would implement a $100 million rolling limit on accrued rebates in an attempt to keep the backlog under control.
“This bill is really a game-changer for New Mexico,” said Sen. Jeff Steinborn, D-Las Cruces.
Film industry supporters have argued the annual spending cap on rebates has stymied industry growth and led to some big-dollar film and TV productions going to other states for shooting.
But critics have questioned the need for the subsidies and argued the money could be better spent on other state programs.
New Mexico’s film incentive program functions as a rebate, offers a 25 percent tax rebate to film companies for most direct, in-state expenditures while long-running TV programs are eligible for an additional 5 percent — or 30 percent in all.