9/17/09:
Tremendous illustrative controversy raging in New Mexico this year about whether their generous filming incentives program is making any economic sense for the State of New Mexico. Two competing studies and a Legislative Finance Committee Analysis that weighs heavily in favor of the more conservative of the two. Read on..........
Economic and Fiscal Impacts of the New Mexico Film Production Tax Credit Prepared for the New Mexico State Film Office and State Investment Council - January 2009Analysis contends film study overstates industry’s economic impact in New Mexico
5/7/07: NEW MEXICO has instituted a $5 million talent cap effective
July 1, 2007. This is a maximum rebate of $5 million for all eligible talent
per production qualifying for the NM rebate. This is not per person, but
for all talent (including stunts) combined.
12/21/06 Update from Axium:
- Discussions are ongoing for star salaries to be capped at $4 million
effective July 1, 2007. Non-resident talent must be paid through a NM loan-out
to qualify; the requisite gross receipts tax reduces the rebate to approximately
17.5%. The state will no longer advance the rebate, so other lenders need
to be involved.
Albuquerque Studios, an 8-stage facility now under construction, will open its first stage on January 15, 2007. The complex, located 5 minutes from the Albuquerque airport, will offer Hollywood-type services, including 70,000 sq. feet of mill and construction space, plus a welding shop and offices. Axium will relocate its New Mexico office to the Studios around January 15.
Below, from Axium Payroll Co.'s "Incentives Guide"
New Mexico offers an interesting package of incentives, including an
interest-free
loan of up to $15 million per project. Requirements for the loan include
a distribution
agreement in place, completion bond, and approval of the screenplay
by New
Mexico’s Film Advisor, a strong repayment guarantee, and participation
in lieu of
interest. Separate from the incentive package, the state of New Mexico
will also
directly invest in films, with similar criteria.
Details are available at http://www.nmfilm.com/filming/incentives/
In addition, New Mexico offers a direct refund (rebate) of 25% of all
qualified
expenses, OR a waiver of state and local sales and use taxes, which
range from 5% -
7%. New Mexico will also waive any location fees for state-owned property.
For an
expense to be qualified, payment must be made to a local employee or
vendor
If talent is paid through a loan-out company registered to do business
in New Mexico,
the talent salaries may be included as qualified expenses. The loan-out
company
must pay a gross receipt tax of between 5% and 7.5%.
An additional rebate of 5% is offered for expenditures made to companies
and crew
members who have lived in the state for at least two years, provided
that 60% of the
below-the-line payroll has been allocated to New Mexico residents.
The tax rebate
now includes post production, video games and film technologies.
There is also a training program that provides 50% of the wages for
upgrading
existing crew members and new union members.
• Directory ? http://www.nmfilm.com/filming/crew-resources/
• Locations ? http://www.nmlocations.com/loc_search.aspx
From Production update april 2004
"Frank Zuniga, a former Disney producer, and now New Mexico's film
commissioner, predicts a banner year for filmmaking, with hopes of surpassing
last year's $80 million generated in production spending.
The main film office is in Santa Fe, with other divisions in Albuquerque,
Las Cruces, Los Alamos and Taos County, according to Rorie Hanrahan, communications
director with New Mexico Economic Development (505-476-3747). Because of
a state budget surplus, an $85 million fund was established, investing
in film projects via no-interest loans. If a film is made in the state,
there is also a 15% tax rebate on all location production costs. "
New Mexico Film
office
New Mexico Filming
Incentives (at their commission website)
Economic
Development Dept. Press Relase Archive (Notices of recent filmings,
etc.)
Lisa Strout, Director
P.O. Box 20003
Santa Fe, NM 87504-5003
Phone: 800-545-9871 or 505-827-9810
Fax: 505-827-9799
Email: film@nmfilm.com
Albuquerque
Film Office
Las Cruces
Film Commission
The Santa Fe
Film Office
Taos Film
Commission
Downloadble
Guides to New Mexico - Very Comprehensive Visitor's Guide, lots of
Brochures, etc.
____________________________________________________________________
Incentive
Information:
Incentives
Overview
New Mexico is one of the most aggressive states
in the country today seeking new film business. Each of the State’s
incentive
programs is outlined for you here. If you have any questions please do
not hesitate to call 505-827-9810.New Mexico's Newest IncentivesUp to
20%
in tax rebatesEnhances the existing tax rebate by adding an additional
5% for certain expenditures. Policies are being developed.$15 Million
per
project in no-interest loansIncreases the allowable cap on each film
loan
from $7.5 to $15M, allowing television series to utilize the loan, and
encouraging larger films to
participate.
Tax rebate expandsNow includes: post production, video games and film
technologies.
This bill responds to the evolution of the industry and opens doors for
technology-based businesses.80% of your estimated tax rebate
upfrontOffered
through the New Mexico State Investment Council and the New Mexico Film
Office. Creates cash flow for the early stages of production.50% Wage
Reimbursement
for on-the-job training$2 million in job training funds. Used for
upgrading
existing crew members and new union members.For more information on our
incentive program download one of our brochures below or call us at
(800)
545-9871.
http://www.nmfilm.com/filming/downloads/investment_program.pdf
http://www.nmfilm.com/filming/downloads/tax_incentives.pdf
http://www.nmfilm.com/filming/downloads/film_workforce.pdf
http://www.nmfilm.com/filming/downloads/adtnl_nm_incentives.pdf
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Filmmaker
Gross Receipts Tax Deduction -
Gross Receipts Tax Deduction
The State of New Mexico charges a gross receipts tax, or
sales tax, at the point of sale. As an incentive, the state will issue
your company Type 16 Nontaxable Transaction Certificates (NTTCs), which
work much like grocery-store coupons. A certificate is presented at the
point of sale and no gross receipts tax is charged.
Who Qualifies:
This program is used primarily by producers of local advertisements and PSAs.
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(From D. Scott Easton - thanks Scott!)
Here
is an excellant recap on how to submit a project for consideration with
the NEW MEXICO FILM Rebate & Loan program drafted by
Peter Dekom "The King of Incentives"...
Subject: Sample of What Peter Dekom Presents to the New Mexico State
Investment Council:
FILM INVESTMENT RECOMMENDATION MEMORANDUM
To: State Investment Council
From: Peter J. Dekom, New Mexico Film Investment Advisor to the State
Investment Council
Re: Lending/Equity Arrangement with Film Production Company
Overview
New Mexico based (name of company) Productions, LLC, (address
in NM) has submitted a request to the SIC and the Film Office pursuant
to NMSA 7-27-5.26 for a motion picture loan, with an equity rate of return
in lieu of interest, for $7.5 million.
This loan would be for the maximum permitted by law, and the budget
of the film (described in detail below) is actually higher: the all-in
cash budget is $8,074,320 (if the film achieves breakeven or better, there
is an additional $1 million deferred out of post-breakeven revenues, if
any, to be paid to the director), inclusive of expected legal fees for
preparing final NM-required documents. The loan represents approximately
92% of the cash budget.............................READ
MORE
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No Location Fees for State Owned Buildings
Filmmakers looking to shoot at any of almost 800 state-owned
buildings can now shoot without paying location fees. In addition, the
closed NM State Penitentiary property known as “Old Main”, a 1940s era
maximum security prison facility with large open cellblocks, hospital wing,
tunnels, and a vast array of office and open spaces, is also available
for fee-free filming
____________________________________________________________________
From
Production Update Magazine January 2004 - "The Southwest"
New Mexico's film history extends back to 1898, when the fifty-second
film ever made, by Thomas Edison's crew, shot at the Indian Day School
at Isleta Pueblo.The director/actor Tom Mix liked to work there too, and
by 1917, twenty-four films had been made in the state. That number has
since soared; in 2002, the state received an estimated $55 million in movie
dollars. In 1985, Silverado shot at the Cook Ranch, south of Santa Fe.
Ron Howard used Valles Caldera, the 89,000-acre national preserve, as a
backdrop for his film The Missing, starring Tommy Lee Jones and Cate Blanchett.
How does New Mexico compete with Canada's cost-saving incentives? The state has its own incentives, in addition to stunning scenery and a film-savvy production infrastructure, built up over the years by the many films made in the area. Filmmakers can take advantage of the $7.5 million in no-interest loans that go to "the right film." Three projects have used that money so far.
Films can take a deduction on gross expenses at the time that they purchase
production supplies, or they can receive a 15% credit against their New
Mexico income tax. Most appealing, the state itself can invest in movies
that are made there, guaranteeing loans that are recouped when the state
takes a portion of the proceeds after the film is released. The state is
grateful for the economic upswing that filmmaking ushers in....................READ
ENTIRE ARTICLE
FROM PRODUCTION UPDATE MAGAZINE JAN. 05 ISSUE:
Westward Ho!(Southwest That Is...)by Brooke Comer
The Southwest was once one big block, in the Hollywood mind. Nevada,
New Mexico and Arizona all offered vast stretches of sandy desert.Today,
things have changed. New Mexico, Arizona and Nevada each have a distinct
identity, defined by tax incentive laws that attract filmmaking, and by
marketing efforts which reveal the unique locations that each area has
to offer. Phoenix is known for its film savvy kids. Tucson offers the look
of the Wild West at Old Tucson Studios. New Mexico has spared no expense
to make a name for itself attracting feature film work through tax incentives.
Nevada’s film friendly casino hotels and ranches are known entities in
every location scout’s file....................READ
MORE
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New Mexico also has a workforce training program, the Film Crew Advancement Program, jointly administered by the New Mexico Film Office and IATSE Local 480. Productions that hire pre-approved resident crew trainees are eligible for a 50% wage reimbursement from the state. A "trainee" is a crew member who has never worked at the craft level for which he or she is being hired. Trainees are assigned experienced mentors, and those not already members of IATSE Local 480 must join within thirty days of hire to remain on a production and qualify for the program.
New Mexico also offers 0% production loans to eligible feature films and TV projects made in the state, up to $15 million per project. The project must be rated PG-13 or lower (with some exceptions), at least 85% of the film must be shot in New Mexico, 60% of below-the-line hires must be New Mexico residents, and a distribution plan and an investment grade guarantor for the principal loan amount must be in place.
Wow, all that plus a refundable tax credit of up to 20%! No wonder 7
new feature films knocked on New Mexico's door last week (though Hurricane
Katrina was no doubt a factor in this deluge).
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http://www.prweb.com/releases/Green/Filmmaking/prweb489021.htm
Governor Bill Richardson Announces "Green Filmmaking" Best Practices
Governor Bill Richardson today released his initial recommendations
on "Green Filmmaking" practices for film and television projects shooting
in New Mexico.
SANTA FE (Vocus/PRWeb ) December 8, 2006 -- Governor Bill Richardson today released his initial recommendations on "Green Filmmaking" practices for film and television projects shooting in New Mexico. The program consists of a list of voluntary steps a production can take to limit its impact on the environment and maximize its benefit to the community.
We are proud to be one of the first New Mexico productions to practice
environmentally conscious filmmaking
"New Mexico continues to find ways to lead the film and television
production industry in innovative practices and incentives," said Governor
Richardson. "Our green filmmaking program shows our commitment to respecting
and protecting our state's natural resources while aggressively growing
this industry. We'll continue to add to and refine the program as we go
along but this is a terrific start."
Eric Witt, the governor's Director of Media Arts and Entertainment Development, explained the structure of the initiative. "Our program is simple," said Witt. "First, help educate filmmakers about environmentally sensitive materials and practices that are either cost-neutral or in some cases even cost-savers. Second, provide productions with contacts to local suppliers of these goods and services, as well as encourage the local business communities to step in where new opportunities arise such as providing recyclable materials pick-up services for set locations. Third, consider limited financial sweeteners such as waiving certain permit fees for productions that adopt these practices - although I stress that New Mexico already has the most progressive financial production incentive program in the country so this is probably the least critical element. Clearly education and connecting productions with the appropriate resources are the key ingredients."
Paul Haggis, writer/director/producer of In the Valley of Elah, currently filming in Albuquerque, is a strong environmental advocate and a board member of the Environmental Media Association (EMA) in Los Angeles. "We are proud to be one of the first New Mexico productions to practice environmentally conscious filmmaking," said Haggis. "In addition to using fuel-efficient vehicles, using biodegradable products, and implementing an extensive recycling program, we have contracted with a local food bank to donate all of our contained and unused food on a daily basis."
"We look forward to playing a part in implementing New Mexico's Green Filmmaking Program. We think it's a great example for other states to follow as well," said Haggis.
3:10 to Yuma, a feature film shooting in Santa Fe and starring Russell Crowe, has also put green filmmaking into practice. On top of donating lumber to a local charity organization, they are also providing their leftover food to a Santa Fe food bank on a daily basis. The production estimates that the food bank will have received thousands of meals by the time filming has ended.
"3:10 to Yuma is very happy to be one of the first productions to participate in Governor Richardson's new Green Filmmaking Program. We are continually looking for additional ways to contribute to these efforts," said Location Manager, Mike Fantasia.
Says EMA president, Debbie Levin, "We're very excited that New Mexico wants to step up and lead the way for green production."
PROGRAM INFORMATION
New Mexico's Green Filmmaking Initiative is a voluntary program to
encourage environmentally sensitive film & television production, built
around three principles:
· Educate and Encourage productions in the use of environmentally
sensitive production materials and techniques.
· Provide resources for green materials and services.
· Incentivize the use of green materials and techniques where
necessary.
Educate & Encourage: The New Mexico Film Office will offer educational materials to productions about the use of alternative materials and environmentally friendly practices in the production office and on-set. This would include information on: recycling; purchasing locally made and/or organic products; donating unused/unwanted items to local school, church or animal welfare organizations; using non-toxic/low-toxic supplies and paints; leasing hybrid/electric vehicles; using biodiesel for generators; using alternative and biofuels for all other vehicles; water management/rainwater harvesting; and waste reduction techniques, among others.
We will provide all productions with a "Green Information Packet" explaining the financial and functional benefits of being eco-friendly - not just for the production but for the community and overall environment.
A Green Filmmaking working group has provided Governor Richardson with preliminary guidelines for building the Green Filmmaking program (see below). The administration will continue to explore new ways to inform and encourage environmentally sensitive productions and examine new business opportunities created through servicing these productions. For example, providing on-location pick-up services for recyclable or unused materials and food is one way the business community and/or private sector can fill anticipated needs.
A voluntary New Mexico Green Filmmaking certification program will also be offered to key production personnel such as Production Managers, Coordinators and other department heads interested in more intensive training in green production. This certification will further awareness and dissemination of information throughout the production community.
Resources: The New Mexico Film Office will supply contacts for environmentally friendly production goods and services through print and on-line resources, encouraging local purchasing where available.
Incentives: New Mexico already offers the most comprehensive film and television production incentive package in the nation. We will consider additional financial benefits, such as waiving certain permit fees, for productions that adhere to the principles of the green production program.
See the list of preliminary recommendations at http://www.ballantinespr.com/newmexico/GreenFilm_BestPractices2_120706.html
For more information on Green Production practices and resources please visit online at http://www.nmfilm.com or http://www.ema-online.org. Or call the New Mexico State Film Office at (505) 827-9810.
To have your green-friendly products or services listed in our resource
guide visit us at http://www.nmfilm.com
or phone (505) 827-9810.