Proposed changes to the state’s film industry credit program would create a media infrastructure credit to allow moviemakers to build studios and other production-support services — but only on Maui and West Oahu.
Oahu Sen. David Ige introduced SB 463, which initially proposed increasing the film tax credit from 15 to 20 percent for Oahu projects and from 20 to 25 percent for projects on other islands along with the infrastructure tax credit. That credit would be applied to the production company’s tax liability after other tax credits are applied, according to a committee report. The bill also aims to remove the $8 million credit per production.
The measure crossed over to the House, where the Economic Development and Business Committee voted Tuesday to amend it with HB 799, which also addresses media production credits. That bill doesn’t offer the media infrastructure credit, but it does broaden the credit to allow a workforce development training program for film production.
The Department of Business, Economic Development and Tourism deputy director Mary Alice Evans testified in favor of the Senate bill, as long as the infrastructure credit was opened up to all the islands, not just Maui or West Oahu.
Richardo Galindez, of Island Film Group, told representatives no studio built in the United States recently was done so without a financial incentive from governmental agencies.
Increasing the production tax credit “would make Hawaii more competitive in an already competitive landscape,” Galindez said. “It’s also about attracting and starting to grow a different type of services to provide. We’re going to encourage large productions to do more of their work here. That would be more post-production, more sound stage work.”
Galindez said he’s been trying to build a studio in Hawaii since 2007. His company was, at one point, in talks with a landowner in Kapolei, but financing for the project never came together. A credit for building the infrastructure would help with those financing problems, he said.
John Mason, of the Big Island Film Office, said he supported the general intent of the measure, but opposed limiting the credit to just two islands.
“On the face of it, this kind of restrictive language seems exclusionary, anti-Big Island, and probably unconstitutional,” Mason said in written testimony. “If there is going to be a tax credit for film infrastructure, we must do everything we can do to make all sections of the state equally open to this opportunity.”
Ige did not respond to a message left Monday. Sen. Josh Green, D-Kona, Kohala, said he doesn’t usually support measures that single out a particular area of the state in this way. This measure, though, came about because a production company was already in the process of locating a studio on Maui, and the Maui delegation, with Maui’s mayor, pushed for the special tax credit.
“They’re already pretty far along already,” Green said.