Law on film tax called positive

With a film tax incentive now on the books, the Nevada film industry may not only grow but thrive.

Last year, JR Reid, owner of JR Lighting and a leader in the push for incentives, said the state’s lack of them over the years had caused a gradual erosion of the local film industry.

The film industry in Las Vegas is about big enough to fill a 50-person crew on a major production and still leave enough people to stage the resident shows on the Strip as well as special events such as conventions and concerts.

With the new law, that will change.

“There’s going to be a lot more jobs for a lot more people,” said Joshua Cohen, co-chair of the Nevada Film Incentive Task Force.

Cohen also is a producer and owner of Cohencidence Productions LLC. He called 2011 and 2012 “devastating” for the industry, but he was positive about the growth the new law could bring.

Gov. Brian Sandoval signed Senate Bill 165 into law June 11, making Nevada the 41st state to offer incentives to attract major motion picture, television and commercial productions.

Beginning Jan. 1, productions that shoot at least 60 percent in-state can earn transferable tax credits of 15 percent to 19 percent of their qualified production expenses, including Nevada cast, crew, labor, gear, rentals, purchases and post. Productions must spend at least $500,000 in-state, and each production is capped at $6 million in credits.

In fiscal 2012, 520 productions filmed in Nevada, bringing a total revenue of $89 million to the state. In fiscal 2011, 479 productions were filmed and total production revenue was $102.5 million. The Nevada Film Office’s records show 2001 as the most lucrative year recently, with 476 productions filmed in the state, bringing in almost $155 million.

Fiscal 2013 closes June 30.

Before the bill passed, those in the industry often argued that Nevada lost business because of a lack of incentives, thereby losing professionals. Included in business lost was the ill-fated “Vegas” television adaptation of former Sheriff Ralph Lamb’s life, which was filmed in New Mexico, a state that for years has offered a tax break on all direct production and post-production expenditures, including the cost of the crew.

Direct comparisons between the states are complicated because New Mexico tracks direct spending rather than revenue. But in 2010 and 2011 combined, New Mexico saw only 60 productions. Still, all were significantly longer, shooting for weeks instead of days. Direct spending there in 2011 was $276.7 million, up from $206.2 million in 2010.

“Once this incentive takes hold, I expect our industry to go up $100 million each year,” Cohen said.

Cohen acknowledged that growth could take time, especially with a four-year cap on the program, which could hurt in attracting television series that typically want to shoot for upward of five and 10 years.

“Over the next four years, we want to prove to Hollywood and the state government that we can handle a bigger and better incentive with no time limitation. Then we can start growing into the $300, $400, $500 million per year range,” Cohen said.

As for Reid, of JR Lighting, he said the industry needs to get ready by reinforcing its crews and investing in equipment. He plans to add employees and is estimating he’ll spend $500,000 on new equipment.

“It’s all so new. It’s hard to press into your mind what the next steps need to be,” Reid said.

Contact reporter Laura Carroll at lcarroll@reviewjournal.com or 702-380-4588. Follow @lscvegas on Twitter.