Is Rio Grande Foundation “shortchanging New Mexico’s film subsidy program?”

I respect the fact that reporters have opinions. We all know Winthrop Quigley of the ABQ Journal had some strong opinions. Milan Simonich of the Santa Few New Mexican has them as well.

He called the Foundation recently about our position on film subsidies and the fact that, especially given the dire budget situation, we would like to zero them out. Simonich then wrote a column in which he staunchly defended the film program and accused RGF of “shortchanging the program’s value with a simplistic argument.”

Our “simplistic argument” in business is what they call “the bottom line,” as the Film Office’s own 2014 report notes, “Film production activity has produced an estimated $0.43 in state and local taxes ($0.33 in state taxes and $0.10 in local taxes) for each dollar in production incentive granted.” So, film subsidies cost state taxpayers about $33 or so million for every $50 million spent on the program.

Numerous studies from the left, right, and center find that film subsides are a money-loser.

My response to Simonich which ran in the New Mexican can be found here.

Image result for state return on investment of film incentives

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3 Replies to “Is Rio Grande Foundation “shortchanging New Mexico’s film subsidy program?””

  1. Does the film industry have any capital investment in New Mexico? Are the studio facilities owned by the studios or private investors, and do those facilities receive taxpayer subsidies or financing?

  2. In the statement “So, film subsidies cost taxpayers about $37 or so million for every $50 million spent on the program”, I can’t figure out where the $37 million comes from.

    The cost to taxpayers is $.57 for every $1.00 spent ($1.00 – $.43), so I get $57 million out of $100 million, which comes to $28.5 million per $50 million. Still a huge cost, but not quite $37 million.

    1. You are correct Nell. It depends of course on whether you include local tax collections or not. If you do not and you focus only on the state budget, it is $33 million for every $50 million. Thanks for the correction.

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