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New Mexico governor calls for big cut in film tax rebate program

January 10, 2011 |  4:19 pm

New Mexico may be running away from runaway production.

One of California's biggest rivals for film production has proposed a heavy cut in its tax rebate program, which offers filmmakers a 25% rebate on their production costs.

New Gov. Susana Martinez, a Republican who has vowed to curtail government spending, on Monday called for reducing the credit to 15% under a plan to balance the state's budget.

The recommendation follows the recent resignation of former New Mexico Film Office Director Lisa Strout, who served under the administration of Democratic Gov. Bill Richardson, and triggered alarm in New Mexico's production community.

Supporters said the cut would effectively take New Mexico out of the running for Hollywood productions because its credit would be lower than what most other states now offer.

"Any kind of reduction, and particularly a 40% reduction, says New Mexico is now closed for business,'' said Dana Arnold, partner for Albuquerque Studios, which is scheduled to host the Marvel Studios superhero movie "The Avengers" in April. "In these tough economic times, we need to do everything we can to foster job creation, and a reduction in the film incentive program is not the solution to continued job creation." 

New Mexico's move is just the latest sign of retrenchment of state film programs, which are drawing sharper scrutiny at a time when many states are facing fiscal crises and as new, more conservative-leaning administrations take steps to curb government spending.

Ohio Film Office Director Jeremy Henthorn was asked to resign last week as new Republican Gov. John Kasich took office. Iowa's new Gov. Terry Branstad plans to dismantle the state's incentives in the wake of a scandal there. And Nick Paleologos, head of the Massachusetts Film Office, resigned last month in a cost-cutting move.

-- Richard Verrier

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