According to a story released by The Hartford Courant last month, the state of Connecticut is actively considering cutting their film tax credits in order to help meet an estimated $3.2 billion budget deficit in the next year.
Among a slew of other cuts, ranging from reducing state spending and requesting givebacks from state employee unions, Connecticut governor Dannel P. Malloy
“…is recommending that only half of a film’s production expenses be eligible for the 30 percent tax credit next year and that the eligible expenses be cut to 25 percent the following year.”
The suggestions are concerning local council members in South Windsor, site of a planned production studio by Connecticut Studios LLC. So much so, Mayor John Pelkey reportedly will be seeking to meet with Malloy to discuss the proposal, which could potentially kill the project to be located in the town’s I-291 Gateway business corridor, which could bring in thousands of industry jobs in TV and film production.
“Connecticut Studios has proposed building a 495,000-square-foot film studio complex that will include 175,000 square feet of sound stage, 104,000 square feet for offices and a 75,000-square-foot hotel. It is similar to a film studio that Connecticut Studios’ parent company, California-based Pacifica Ventures LLC, built in Albuquerque, N.M. That company, Albuquerque Studios LLC, has since filed for bankruptcy.”
As states struggle to meet budget gaps, lower priority spending and tax credits related to the entertainment industry are coming under close scrutiny. Last year, Governor Deval Patrick proposed capping the highly successful film tax credit program in Massachusetts, only to be later voted down.