Two big Hollywood projects just wrapped up recently in Cleveland: Kevin Costner’s football flick, “Draft Day”, and the “Captain America” sequel.
Ohio’s film tax credits have drawn movie crews back to where parts of the superhero hit “The Avengers” filmed earlier. But if the film crews and celebrity sightings are back, so is the debate as to whether Ohio’s film tax credits truly deliver.
Two years ago, the “Avengers” movie crew spent more than $20 million in Cleveland. Izzy Schachner, who owns a local catering company, has come to rely on the bump his business gets from these movie productions.
“It can add up to maybe about 30 percent of our total revenues for the year,” says Schachner. “I see it only getting better, as long as the tax credit continues to renew.”
Ohio’s tax credit for films has been around a few years. It reimburses film makers 25 percent of what they spend in Ohio. That’s been generous enough to lure movie shoots away from Michigan and New York.
Ivan Schwarz, who heads up the Greater Cleveland Film Commission, says since the state’s film tax credit was put into effect, more than 40 productions have come to Northeast Ohio.
“What we’re trying to do, is slowly and methodically grow this industry, create a scenario where anybody that has the right skill set can work in this industry 24-7, 365 days a year,” says Schwarz.
But the problem is, nearly every state government has been trying to rework their tax laws to bring a little Hollywood glamour into their front yard.
Zach Schiller with Policy Matters Ohio thinks, “These incentives are a loser.” Schiller says there’s a reason to be skeptical. That’s because most states don’t bring in enough revenue from the films to justify the tax breaks.
“Let’s face it, having some big Hollywood stars in your town is a nice thing,” Schiller says, “But we certainly aren’t going to have 40 states building film industries based on their tax credits.”
In nearby Wisconsin, the tax credits have bombed after years of measly returns. So Wisconsin’s latest state budget leaves its film tax incentives on the cutting room floor.
But Ohio’s pushing on. The governor doubled down, taking Ohio’s film tax credits from $10 million to $20 million a year.
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