Did lawmakers give away too much to create Hollywood south? - CBS46 News

Did lawmakers give away too much to create Hollywood South? CBS Atlanta investigates

Posted: Updated:

How do you spell Hollywood? Many people spell it A-T-L, or Atlanta. Movies like Zombieland, blockbusters like the Hunger Games and top TV shows like The Walking Dead and The Vampire Diaries, were all produced in the greater Atlanta area.

Lee Thomas is the director of the Georgia Film Music and Digital Entertainment Division.

"It has been a great thing for Georgia. The buzz from all the shows has been great. You see a lot of media attention from it," said Thomas.

Thomas said Georgia is the new hot spot for film and television production.

"The profile of the films we've gotten is much bigger than we have ever had in the past," Thomas said

"We've seen $3.5 billion in economic impact this year alone."

Last spring, state lawmakers passed legislation that sweetened the pot for production companies that shoot in Georgia. Those companies now get a 30 percent tax credit. That is one of the more generous in the country. On a $100 million movie, the production company is entitled to $30 million back. Thomas said for every dollar the state gives in film tax credits, it gets back $1.24. But some call that fuzzy math.

"I wouldn't dispute most of the claims they make about the jobs and the spending, it's all true. But the revue claims, the mountain of evidence suggests otherwise," said Adrian McDonald.

McDonald is the author of Down the Rabbit Hole, The Madness of State Film Incentives as a Solution to Runaway Production. The study examines state tax breaks used to attract film and TV production. He said almost all the studies that show tax credits make money for state governments are paid for or backed by the movie industry. But McDonald said the overwhelming majority of independent studies show tax incentives like Georgia's are money losers.

"I'm sorry to say, they just show time and time again that these programs make at best 30 cents on every dollar spent," McDonald said.

McDonald said the state should be spending its money in other areas.

"If the state decides to build a road with $30 million that it could give to a $100 million movie, that road construction will still put people to work. If it hires teachers, those teachers will put teachers to work. I mean the money could be spent elsewhere to create jobs.

"Given the economic environment we are in now, is that the best way the state should be spending its money?" asked CBS Atlanta anchor/reporter Bernard Watson.

"According to the study, it is. According to the study, it would be a lot worse if we didn't have the film tax credit," Thomas answered.

McDonald isn't convinced.

"You won't ever get back that $30 million on tax revenue. The local sales tax in Georgia and local income tax in Georgia is just not 30 percent," said McDonald.

Thomas said Georgia is in a heated battle with Louisiana and North Carolina to attract film and TV production. She said if the state lowered its tax rate, Georgia would fall behind the others.

Copyright 2013 WGCL-TV (Meredith Corporation).  All rights reserved.