The fate of a state tax credit for movie productions is still being hashed out in Harrisburg, but one thing seems certain: Republican efforts to get rid of the incentive have just cost Pittsburgh a feature film.
Producer Mike Wittlin, a Pittsburgh native, planned to start shooting his latest comedy, Mangus, in the city late next month. Wittlin bills the movie as a Napoleon Dynamite-esque comedy, starring Brittany Snow and Amy Smart. Wittlin planned to shoot here partly because of a 25 percent state tax break filmmakers earn if at least 60 percent of a movie's budget is spent inside the state.
But Wittlin says the budget debate in Harrisburg makes it too uncertain that the credits will be around when production begins. In February, state Sen. Pat Vance (R-Cumberland County) sponsored a bill to place a moratorium on film tax credits, in an effort to balance the budget.
"It's too hard to keep fighting with the politicians," says Wittlin, president and CEO of Mike Wittlin Productions. "I waited longer than I should have because I believed in the state." But now, "I'm moving my movie to Puerto Rico."
Wittlin filmed his last two movies -- In NorthWood and The Bridge to Nowhere -- in Pittsburgh, but says Puerto Rico offers a 40 percent tax incentive.
Roughly 40 states offer film tax credits, and Wittlin says filmmakers factor those breaks into their budgets. Just by debating the credits, "The state is shooting itself in the foot," says Wittlin, speaking via phone from Florida. Eliminating them "will kill the [local] film industry."
A study released by the state's Legislative Budget and Finance Committee in June echoes some of Wittlin's claims. Economics Research Associates (ERA), of Chicago, found that the credits generated nearly $525 million in economic activity, resulting in roughly $18 million in state and local taxes. The report concluded that projects receiving the tax credits created 4,000 jobs in 2007-08.
"[The program] is actually working," says Dawn Keezer, director of the Pittsburgh Film Office. "It's a complete return on the investment."
"The tax credits have been an overwhelming success," agrees Michael Smith, a spokesperson for Gov. Ed Rendell. "The Governor thinks [the program] is a valuable economic-development tool."
But the tax-credit has its detractors.
Vance could not be reached for comment, but in a June statement, she said, "We cannot afford to continue the film tax credit at a time when some legislators are considering tax increases.
"I am confident that Pennsylvanians do not want their taxes raised to preserve a subsidy for the film industry," the statement added.
Matthew Brouillette, president of the conservative Commonwealth Foundation, has similar misgivings. Conservatives generally favor tax cuts, but when it comes to industry-specific breaks, "We see them as bad economic policy," he says. "It's not a broad-based credit for all businesses. ... That's not how you foster a better economy."
Brouillette disputes the findings in the ERA study, arguing that the research firm has its own agenda. "That study was hardly independent," he says. In fact, ERA's Web page boasts a number of film-industry clients, including Universal Studios Inc. and Twentieth Century Fox. "The firm has a direct interest in fostering these kinds of tax-credit programs," Brouillette says.
What happens now? Brouillette says when the state hashes out its budget, there's a "good chance" the credits will be axed. Keezer, on the other hand, says she's "very confident" they'll stay.
Even if they do survive, however, it'll be too late to lure Wittlin's movie to the Steel City.
"It's a shame," says Wittlin. "I love Pittsburgh."