Tax subsidies for the film industry would be reduced under legislation approved by the Senate Finance Committee on Wednesday night.
A program that cost taxpayers $226 million in 2014 would cost $180 million under the bill approved by the committee.
The committee also planned to consider legislation Wednesday night that would scale back subsidies for the solar energy industry. But committee Chairman Jack Donahue, R-Mandeville, deferred the measure, House Bill 779, until Thursday because of uncertainty over the impact of proposed amendments.
The film and solar energy tax subsidies have been popular in recent years — too popular according to lawmakers, who are shaving tax breaks to help close the projected $1.6 billion deficit in approving the budget for next year.
As the committee hearing began, House Bill 829 would cap the cost of the film tax credit at $200 million per year. It is projected to cost $250 million this year.
The committee approved an amendment Wednesday night that would cap the program at $180 million per year but rejected one that would establish a $165 million cap.
State Rep. Joel Robideaux, R-Lafayette, and the bill’s sponsor, has favored keeping the program with some changes.
“We’re trying to make it more of an indigenous credit to film makers,” Robideaux told the committee.
He said the original intent of the tax subsidy was to build a film industry in Louisiana. But, he said, most of the money goes to a small number of big productions made by non-Louisiana companies. Robideaux said he would rather more Louisiana-based filmmakers claim the subsidies in smaller amounts.
But the committee “significantly gutted and weakened” that effort with an amendment, Sherri McConnell, who helped draft the legislation with Robideaux, said afterward. State Sen. Dan Claitor, R-Baton Rouge, offered the amendment.
McConnell, who previously oversaw the program at Louisiana Economic Development, said she hoped to reverse Claitor’s change when the bill makes its next stop, on the Senate floor. If approved there, in whatever version, it would have to be approved in the House to be enacted into law.
Critics of the program say taxpayers are getting little bang for their buck. Independent studies show that taxpayers get about 20 cents in tax revenue for every $1 in tax credits given to film makers.
Supporters credit the tax subsidies with creating thousands of jobs and turning Louisiana into “Hollywood South.”
The subsidies are so generous that those opposing changes say film producers will go elsewhere if the Legislature goes too far. Film makers can use the tax credits to recoup 30 to 35 percent of their costs.
HB779 would take aim at tax breaks that solar companies get for leasing their systems to customers.
State Rep. Erich Ponti, R-Baton Rouge, said the tax breaks for leasing have become too expensive for the state. He estimated that about 75 percent of the solar energy installations are leased. His bill would limit solar tax credits for leasing to $10 million per year, which would save about $15 million per year.
The solar tax break would expire at the beginning of 2018, under legislation approved previously.
The Senate Finance Committee will take up Ponti’s bill upon adjournment of the Senate on Thursday.
Follow Tyler Bridges on Twitter @TegBridges. For more coverage of the state capitol, follow Louisiana Politics at http://blogs.theadvocate.com/politicsblog/.