House Of Tax Breaks

The producers of House Of Cards are demanding more tax credits from Maryland, where the show is filmed, and threatening to move production out of the state if they don’t get them:

Maryland reimbursed Media Rights Capital $11 million for season one of House of Cards; season two saw the state up that figure to $15 million. But officials haven’t yet increased Maryland’s annual TV and film tax credits enough to keep the money flowing for season three. That’s likely to happen at some point, but what’s not clear is whether the new number will be enough to keep House of Cards in Maryland. In a letter to [Governor Martin] O’Malley, Media Rights Capital’s Charlie Goldstein said, “I am sure you can understand that we would not be responsible financiers and a successful production company if we did not have viable options available.”

Liz Malm calls this a “political ploy” and urges states to stop competing to attract Hollywood producers:

Film production only creates temporary jobs, and companies can leave at the drop of a hat. The Maryland Film Office estimated that House of Cards Season 1 “resulted in local hiring of 2,193 Maryland crew, cast, and extras” but it’s pretty clear based on the letter above that companies can bolt the second they get a better deal. And those jobs aren’t available once filming wraps up.

Programs do not “pay for themselves” as is often touted. Proponents will argue that increased economic activity will create enough new tax revenue to make up for the initial loss of revenue from the credit. That’s not true. In fact, film tax incentives are a net loss to states, and there are plenty of studies demonstrating this.

Ed Morrissey doesn’t buy the state’s numbers:

Supposedly, this created 6,000 jobs and inflated the economy of Maryland by $250 million, according to economic data supplied by the state’s economic development office to the Post’s Jenna Johnson. I find those numbers incredible … in the most literal sense of the word. One season of a television show aired exclusively by Netflix created a quarter of a billion dollars in economic activity in a single year? What were the 6,000 jobs created by a television series in one season? The budget for the series is $3.8 million per episode, which includes salaries that get spent elsewhere than in Maryland. The first season ran 13 episodes, which puts the total production investment for Season 1 at $49.4 million. If even half of that got spent in Maryland, I’d be surprised, thanks to the star salaries involved — but it if did, Maryland is claiming a 10:1 multiplier factor. That’s utter nonsense.

Alyssa explains why the show isn’t shot in DC itself:

The District of Columbia doesn’t offer tax incentives to film and television productions. And complex jurisdictional and permitting issues make it hard for crews to get even good establishing shots of landmarks like the Capitol Dome. As a result, none of the current crop of political hit shows films in the District itself. House of Cards and HBO’s Vice Presidential comedy Veep film in Maryland. Showtime’s CIA thriller Homeland shoots in Charlotte, North Carolina, and overseas–I once told Homeland showrunner Alex Gansa that if the show had staged a bombing in the actual Farragut Square, rather than the wide-open park that substituted for it, Homeland would have been able to claim a lot more casualties. FX’s period drama The Americans, which is set in the District and Washington suburbs, films in Brooklyn, where production of its first season was interrupted by Hurricane Sandy. Scandal mocks up its images of Washington, but films on the West Coast.