NM: House Committee Delays Action on Bill To Study Incentives

A bill that would allot $50,000 to study New Mexico’s film incentives was held over in the House Taxation & Revenue Committee on Feb. 15.

Rep. Bill McCamley, D-Las Cruces, introduced HB 490 as a way to jump-start a process started two years ago when Sen. Tim Keller, D-Albuquerque, succeeded in getting a bill passed to study the effectiveness of the film incentive program. However, there was no appropriation connected with that legislation.

There has been little movement since then, although the Department of Finance and Administration said it will issue a request for proposals this spring to conduct the study.

“If we’re spending a dollar and getting $1.10 back, then the cap should be lifted,” McCamley said, referring to the $50 million annual cap put in place several years ago. “If we’re only getting 90 cents on the dollar, then maybe we should get rid of the whole thing. We should know what works and what doesn’t.”

McCamley wants New Mexico State Auditor Hector Balderas to conduct the study.

“With all due respect to the governor’s office, this has become a massively politicized issue,” he told the committee. “I would like the state auditor, who is elected on the basis of being a completely neutral authority, to be the one doing this so we know we are getting as neutral a position as we can.”

McCamley said two previous studies were done “by folks with a little bit of skin in the game.” One was commissioned by the Bill Richardson Administration and done by Ernst & Young. It painted an extremely rosy picture of the film incentive program. Another by the Arrowhead Center at New Mexico State University found the state was losing money on the program.

Rick Clemente, CEO of I-25 Studios and legislative representative for the NMEDIA industry group, said the film and media industry supports having a more thorough study of the incentives. But he questioned if it could be done effectively for $50,000.

“There are only a couple of companies around that could meet the requirement of the RFP,” he said, noting one is the Milken Institute, which did a study on the impact of lost production in California.

Such a study would likely cost $250,000 to $300,000, Clemente noted. Terri Cole, CEO of the Greater Albuquerque Chamber of Commerce, voiced support for that idea as well.

“The business community is not afraid of studying this industry because we think it’s positive and we need to keep making it competitive, but we need to be careful about getting informally into another study without putting the money into it that is necessary and making sure it’s done well,” Cole said.

Committee member Rep. Bob Wooley, R-Roswell, asked Evan Blackstone, chief of staff for the state auditor, if his office could do this for $50,000.

“It’s difficult to say at this point, but it’s a good start,” Blackstone said.

Committee Member Rep. Stephen Easley, D-Santa Fe, floated the idea of a public private partnership where the film and media industry would help pay for the study. But McCamley said he feared that might give the perception of bias.

Sandoval held the bill over and asked Wooley and Rep. Carl Trujillo, D-Santa Fe, to work with McCamley on adding more specifics to the legislation. The fiscal impact report on the bill actually called it superfluous since the RFP is due to be released this spring to do the study.

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