Legislature(2007 - 2008)BELTZ 211
02/14/2008 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB183 | |
| SB187 | |
| SB230 | |
| HB233 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 233 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 230 | TELECONFERENCED | |
| += | SB 187 | TELECONFERENCED | |
| = | SB 183 | ||
SSSB 230-FILM OFFICE/ FILM PRODUCTION TAX CREDIT
1:48:00 PM
CHAIR ELLIS announced SSSB 230 to be up for consideration. He
said there were concerns about internships and a few other
issues at the last meeting.
MAX HENSLEY, staff to Senator Ellis, sponsor of SSSB 230,
explained new CS SSSB 230 (L&C) 25-LS1275\O. He explained that
in the last hearing they discussed the internship program with
Senator Stevens and as a result on page 2, lines 15 and 16 allow
the film office to certify Alaska film production internship
training programs. To promote the employment of the program
interns by eligible productions this version removes the link
between the internship program and the university and removes
the questions about private industry wishing to maintain
internship programs for individual people wanting to apply to
the film office. The film office has assured him it is well
within its ability to do this kind of certification with
regulation.
MR. HENSLEY said the other change was on page 4, lines 13 - 16,
that has a tighter definition of what the duties of the
independent CPA are regarding verification of the spending done
in the state - in response to Senator Bunde's concerns about
fraud. This language was suggested by the drafters as the most
precise.
1:51:31 PM
SENATOR BUNDE asked if that language guaranteed if something
fraudulent was found beforehand the film office wouldn't have to
seek recourse.
MR. HENSLEY replied that was the intention.
CHAIR ELLIS added that there's always legal recourse for fraud,
but you don't want the incentive to be in danger of being
pulled.
MR. HENSLEY said that is a concern with this kind of
transferable credits. The secondary market for them will be
significantly weakened if there is the potential for a party not
involved in the production who purchases the credits to be
liable for the activity of the producers.
CHAIR ELLIS clarified that this language is for the state's
protection and to avoid the problem.
MR. HENSLEY said the final issue that was raised was the listing
of qualified expenditures on page 4. The language on line 26
says the spending has to happen directly within the state. He
said that some things like technical lighting aren't available
in the state and will have to be transported here. Alaskan
businesses will be involved in that and that would be part of
the qualified expenses.
1:54:13 PM
SENATOR STEVENS said he wasn't sure this language meant what Mr.
Hensley said it did. He asked if it talks only about post-
production expenditures in the state or about everything above
that directly incurred in this state.
MR. HENSLEY responded any of the three - pre-production,
production and post-production expenditures - incurred in the
state of Alaska would qualify.
CHAIR ELLIS and SENATOR BUNDE stated that it was their intent to
include all three.
1:56:41 PM
DAMA CHASLE, production executive, wanted to address some points
from last Tuesday's meeting and urged them to consider the
increased cost of getting equipment to Alaska. She reiterated
that currently Alaska doesn't have adequate infrastructure and
trained crew available. She supported keeping the 30 percent
base tax credit to offset these costs.
She underscored the many jobs that will come to the state as a
result of having this industry, saying a studio film typically
employs several hundred people in high paying, high tech jobs
that last for months. They plow considerable monies into local
economies, from the obvious hotels and rental cars to the less
obvious lumber yards, dry cleaners, teachers for minors who are
on the set, seamstresses, caterers, extras, animal wranglers,
film digital lab processing, et cetera. "And it's always
preferable to hire trained local crew, because of the savings in
travel and living and the local knowledge of the customs and
procedures."
1:58:28 PM
WILLIAM CAVAN, independent video and film producer, Orlando, FL,
commended them on this bill. He said he was presently producing
a low-budget film in Florida, and a few of the people he talks
to recognize Alaska is the place to film this and to hire
locals.
1:59:20 PM
MICHAEL COLLIER, independent Anchorage film producer in
Anchorage, noticed that the crew base in Alaska is dwindling. He
has had many friends who go from college and want to get into
film, but they just decide they can't do it here and go
somewhere else. So when he makes his small projects, it's hard
to find crew, and he imagined it would be even more difficult
for larger productions that would have to hire from other places
outside the state. An incentive to build a crew base up here and
to develop more talent would also bring up more projects that
would develop into a range of films from big to small.
2:01:11 PM
CHAIR ELLIS thanked him for being a part of the response on this
bill. He noted the "avalanche of support from the strangest
corners of Alaska."
2:01:34 PM
KATE TESAR, Alaska Film Group, thanked the committee and noted
that the Cohen Brothers have purchased rights to produce a
recent best seller in Alaska so the timing of this bill could
not be better. She said the bill has become even better with
their help.
SENATOR STEVENS asked if this bill could actually have an impact
on that film.
MS. TESAR responded that they hoped to get regulations written
in this fiscal year.
2:03:43 PM
SENATOR DAVIS moved to adopt CSSSSB 230(L&C), version O. There
were no objections and it was so ordered.
SENATOR BUNDE commented that they are giving transferable tax
credits to an entity that doesn't pay any taxes and he hoped
they wouldn't become an unsustainable drain on the state
treasury and have to be canceled like the previous one. He
thought a more accurate title would be "the film subsidy bill."
CHAIR ELLIS noted that the State of Alaska chooses to operate in
a certain way with its corporate taxation and its personal
taxation, whether it be income tax or sales tax. It chooses to
operate the state on oil revenues; whether that is wise or not
remains to be seen. This is an opportunity for economic
development and employment. The state makes it choices at the
state level, but that may change in the future.
SENATOR BUNDE mentioned that he can't help but think it's
somewhat ironic that they are about to move a bill forward that
provides tax incentives because it will increase development,
when a few short months ago they raised huge taxes on an
industry and said it wouldn't affect its ability to invest at
all.
CHAIR ELLIS said "The proof is in the pudding. We'll see how it
all turns out. And I think we'll be here to take note."
2:07:06 PM
SENATOR STEVENS moved to report CSSSSB 230(L&C) [version O] from
committee with individual recommendations and attached fiscal
note(s). There being no objection, the motion carried.
| Document Name | Date/Time | Subjects |
|---|