Last year, we at the Rio Grande Foundation proposed capping annual outlays for New Mexico’s film industry subsidies (25% on the dollar is given to the industry) at $30 million annually. The ultimate agreement was to cap the subsidy at $50 million annually. This is a reasonable compromise, but the fact is that the film industry subsidies represent net spending (they are not a credit, thus representing foregone taxes) and are bad economic policy. Long-term, the subsidies should be phased out towards total elimination.
Unfortunately, liberals in the Legislature are hoping to eliminate the cap on TV shows, thus giving unlimited subsidies to the filming of television shows in New Mexico. SB 168 is terrible legislation. Rep. Kintigh’s HB 117 would move our state in the right direction by phasing out the subsidy at a rate of one percentage point annually.