Missouri moves step closer to restoring film tax credits; state Rep. Kathy Swan's bill faces final action in House

Missouri has moved a step closer to re-establishing a tax credit program designed to turn Missouri into a destination for movie making.

State Rep. Kathy Swan, R-Cape Girardeau, has pushed to reinstate the program ever since it expired in 2013.

Her measure, the Show Me Missouri Film and Digital Media Act, recently won initial approval in the House. Final passage could occur this week, she said. A similar measure is moving through the Senate.

“Actually, there may be more support in the Senate than in the House,” she said.

Several amendments were added to the bill in the House. Swan said she didn’t initiate the changes, but will support the amended measure.

“It is not a deal breaker,” she said.

One amendment would limit tax credits to 90% of the tax credit approved by the state for a particular production, unless the municipality where the production is occurring remits 1% of the value of the tax credit to the Missouri Department of Revenue.

Another amendment would require film companies to disclose political donations of more than $25 made to any Missouri campaign committees or political parties during the two years before applying for a tax credit.

Swan said the Senate bill doesn’t include the amendments that were added to the House bill. If the Senate passes its own measure, a conference committee of House and Senate members would have to reconcile the differences.

As a result, the amendments might be removed from any compromise legislation, Swan said.

Swan said some lawmakers object to state tax credits in general, arguing it leads to lower tax revenue for everything from education to senior services.

Still, she thinks many of her colleagues are tired of movies and television series, whose plots are Missouri based, being filmed in other states and Canada.

Movies shot in Missouri can pump millions of dollars into the local economy, she said.

“Since 2013, we have lost more than 10 studio projects representing at least $150 million in lost economic impact,” Swan wrote in an email Wednesday to her House colleagues.

Those projects included the movie “Three Billboards Outside Ebbing, Missouri,” which was filmed in North Carolina, and the HBO television series “Sharp Objects,” which was filmed in Georgia and California.

“Gone Girl,” a movie filmed partly in Cape Girardeau, was the last major production in Missouri to take advantage of the tax-credit program before it expired, according to the Missouri Motion Media Association.

Twentieth Century Fox spent nearly $7.9 million in Cape Girardeau filming “Gone Girl” in the fall of 2013, according to the association.

Swan wrote her measure “gives us a chance to participate in an industry that is exploding, once again.”

The Cape Girardeau lawmaker stressed the tax-credit program is small in comparison to other states.

“There are eight states that have no cap,” she said.

Under Swan’s bill, Missouri’s proposed film tax credits would be capped at $4.5 million annually, a limit the state previously adhered to when it offered a tax credit.

Swan’s measure calls for tax credits to be offered, beginning Jan. 2, 2020. The tax-credit program would sunset at the end of six years unless renewed by lawmakers.

The legislation authorizes a tax credit of 20% for certain in-state expenses and 10% for expenses associated with some out-of-state personnel brought into Missouri to work on a film.

An additional 5% tax credit could be provided when at least 50% of the movie or television series is filmed in Missouri.

Missouri’s history of film tax credits dates back to 1999 when filmmakers could qualify for a 50% tax credit, but had a total cap of $1.5 million.

In 2008, the credit was reduced to 35% with a $4.5 million cap, Swan said.

Her legislation could provide up to a 35% tax credit, but only if the production meets all the expense qualifications, she said.

Under the legislation, the wages of highly compensated individuals on movie sets, such as the leading actors, would not be included in eligible expenses.

The Missouri Department of Economic Development would have to approve the project for it to qualify for tax credits, Swan said.

mbliss@semissourian.com

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