A House committee on Monday hears a proposal by a Democratic legislative leader to revise the 25 percent tax refund that New Mexico offers for certain film and TV production expenditures.
House Majority Whip Antonio “Moe” Maestas proposes to boost the tax incentive by 5 percent for a TV series that produces at least six episodes in the state.
Supporters say a successful TV series, such as the popular show “Breaking Bad” that’s filmed in New Mexico, can provide a boost for the economy over several years and stable jobs for local crew members.
“That 5 percent is key, and I hope everybody realizes that it’s in our long-term interest,” Maestas said in an interview.
The award-winning AMC TV series “Breaking Bad” is set in Albuquerque and is filming a fifth and final season. The show follows Walter White, played by Bryan Cranston, producing and selling methamphetamine with a former student.
Maestas said he hoped the proposed tax changes can clear the Taxation and Revenue Committee, which would send the proposal to the 70-member House for debate and a vote.
The legislation will leave in place a $50 million limit on the tax subsidies provided by the state each year for all film and TV projects.
However, Maestas proposes to allow unused subsidies below the cap to be carried over to the next year.
The governor supports that change, which in some years could provide more than $50 million in tax incentives.
The Legislature and GOP governor agreed to the $50 million annual limit in 2011 after Martinez initially wanted to reduce the tax credit rate to 15 percent.
The cap was enacted when New Mexico faced a budget squeeze and state officials wanted more control over the costs of the film incentives.
The state provided about $96 million in film and TV tax refunds in the 2011 budget year, as production companies rushed to meet a deadline before the $50 million limit took effect.
The following year the state paid out about $9.5 million, and the New Mexico Film Offices estimates the incentives could reach about $45 million this year.
When the Legislature convened this year, some Democratic lawmakers initially wanted to try to eliminate the $50 million cap on film and TV incentives. However, they’ve dropped that and instead developed the proposal advocated by Maestas.
Martinez opposes lifting the $50 million cap, saying it’s needed to protect the state budget.
“The governor is encouraged that Democratic leaders have recognized that we need budget predictability in order to ensure that we protect core priorities like classroom spending and health care for those in need,” said Enrique Knell, a spokesman for the governor.
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