February 06, 2018 04:41 PM
On the day after the Super Bowl all the buzz is about the commercials. Well, there’s a chance that you helped pay for some of the ads you saw this year.
New York State offers a tax break to firms who agree to shoot or at least edit part of a commercial in New York State. Since the program started in 2010, the state has shelled out $31 million in tax breaks for the production of 2,500 commercials. Critics say the tax break simply makes the rich, richer.
We all like a good commercial but if a company is trying to sell us something, should we be the ones paying part of the tab for their snazzy pitch? News10NBC took that question to Howard Zemsky, the President of Empire State Development, the agency that manages the program.
“Language matters, we’re not just giving it, this isn’t like a holiday gift. You have to make investments and create jobs in order to get some credits and those credits provide positive return on investment,” Zemsky said.
Zemsky said the tax credit encourages producers to choose New York for their productions but of the 34 companies who received a tax break in 2015, half were already based in New York. The other half are based in California.
Good government groups say that’s no coincidence.
“The people who are getting that tax credit, which are film and TV production companies that make TV commercials, are major political contributors and this is really pay to play and tax policy that’s based on campaign contributions,” said John Kaehny of Reinvent Albany.
State leaders said it’s not just about bringing in new jobs but retaining the ones that are here too. 11 other states currently offer a commercial tax credit so if we don’t, producers may go elsewhere.
“We continue to analyze it and the return on investment but at this state it has been increasing over time, not decreasing,” Zemsky said.
In the grand scheme of things, the program is fairly small. It has a $7 million annual allocation but Kaehny said it’s all about where it could go from here.
“Our concern with that is that it’s a foot in the door,” he said. “Just by way of perspective, the film and TV tax credit when it was created in 2004, was for $25 million and today that’s a tax credit that’s $420 million dollars so it’s grown almost 18 folks in that time period.”
The film and TV credit, Kaehny mentioned, is a program News10NBC has investigated before. New data shows that just one show, “Gotham,” received $22.3 million in 2016 alone to film in NY. Other productions like Law and Order: SVU, Elementary and Blue Bloods received millions too.
There has been a push by a number of state lawmakers to do away with both the commercial and the film and TV credits, including Assembly Minority Leader Brian Kolb, who is running for governor.
“I think that the governor and his administration get to decide on behalf of the taxpayers who should get this money and how much, Kolb said. “I think the system is rigged and it needs to be scratched and start all over.”
Updated: February 06, 2018 04:41 PM
Created: February 05, 2018 08:26 PM
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