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Connecticut grabs TV business from other states

Craig LeMoult May 17, 2013

Connecticut grabs TV business from other states

Craig LeMoult May 17, 2013

Stamford seems to have become the center for TV shows where fights break out. Maury Povich and Jerry Springer film are here. WWE Wrestling is based in Stamford. The soaps “One Life to Live” and “All My Children” are shooting here. NBC Sports, which includes boxing, is in Stamford now. There’s the National Hockey League Network. And, the legal forum for TV squabbles – the People’s Court.

Kevin Segalla shows off the People’s Court set.

“This is the same People’s Court set that they’ve used for years and years and years. And they moved it from New York here into Connecticut,” Segalla says. “And it looks just like a regular courtroom, right?”

It does, except for the ceiling full of lights and the cameras. Segalla is the CEO of the Connecticut Film Center, which owns the building this studio is in. Connecticut Film Center is a for-profit company with a business model of luring TV shows with the promise of state tax incentives, and then providing them with facilities and production services.

“One Life to Live” and “All My Children” shoot next door.

Segalla says his initial plan was to start the business in Massachusetts. But then he ran into the Connecticut Speaker of the House at the time, who asked him why he was doing that.

“I said ‘Well, they have an excellent tax incentive there.’ And he says, ‘Well, we’ll pass a tax incentive here.’ And I said ‘Well, they got a 25 percent tax incentive there.’ And he said, ‘I’ll pass a 30 percent tax incentive.'”

And that’s exactly what Connecticut did.

“When somebody comes in,” says Segalla, “if they spend money in the state on local businesses and local crew, then they get a tax credit of 30 percent of that expenditure.”

Rich Frank is the former president of Disney and now head of the production company that just brought the soap operas to Connecticut. He says the tax credits create jobs.

“We have about 200 people working here because they reduced taxes, it’s pretty simple,” says Frank. “They weren’t doing it, California’s pretty sticky, New York even outlaws tax breaks for soap operas.”

New York also limits tax credits for live sports, which helped attract NBC Sports to Connecticut. NBC consolidated its sports operation and the NHL Network at a Stamford facility owned by the Connecticut Film Center. But the state did more than just give NBC a tax credit. Connecticut loaned the company $20 million at one percent interest, and will forgive the entire loan if it creates 450 jobs in five years.

NBC Sports Chairman Mark Lazarus announced the move in 2011.

“The experience we’ve had here and some of the inducements made it make more sense,” he said. He called it a strategic decision driven by where they think they can create the best product.

Connecticut Governor Dannel Malloy says these kinds of deals pay off for the state.

“We don’t do deals that don’t pay back relatively quickly.” Malloy says. The high paying jobs lead to income tax revenue for the state, and there are property taxes for the city.

“We rolled out the carpet for some folks in Stamford just a few years ago, that led to other folks saying ‘hey, if they can do it for them, they can probably do it for us,'” says Malloy.

For the TV shows, the attraction to the Nutmeg state is more than just the tax breaks. It’s close to New York, but can be a lot cheaper. And for NBC Sports there may be another draw — a little over an hour away in Bristol, Conn. is ESPN. And poaching some of that talent is probably a lot easier when you’re nearby.

Kevin Segalla of the Connecticut Film Center says overall, Connecticut may have added as many as ten thousand jobs in the TV industry.

“The TV business is a large and growing business, and taking a nice sliver of that is significant to the economy in Connecticut, and we’ve got a good sliver here,” says Segalla.

And he’s fighting to make that sliver into a real slice.

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