Louisiana House Bill HB569

Louisiana 2015 Regular Session

• Introduced: 4/3/15
• Refer: 4/3/15
• Refer: 4/13/15

Caption

Limits transferability of motion picture investor tax credits

Impact

The introduction of HB 569 is expected to streamline the process surrounding the motion picture investor tax credits. By establishing a one-time transfer rule, the legislation could lead to more predictable outcomes for tax credit allocations, benefiting both investors and the state treasury in terms of oversight. However, it may also discourage potential investors who were previously attracted by the prospect of transferring incentives multiple times, thereby influencing future investments in state-certified productions adversely. The overall impact on film and production companies operating in Louisiana will depend on how these changes align with their financial strategies.

Summary

House Bill 569, introduced by Representative Thierry, aims to amend existing law regarding the transferability of motion picture investor tax credits in Louisiana. The bill proposes a limitation on the transferability of these tax credits, restricting it to a one-time transfer to another taxpayer within the state or back to the state office. This change is significant as it alters the previous provisions, which allowed for multiple transfers or sales of tax credits that had not yet been claimed. The bill is applicable to applications submitted from January 1, 2016, and onward, requiring any parties wishing to transfer their credits to adhere to the new stipulations.

Sentiment

Sentiment around HB 569 appears to be mixed. Supporters, likely including the administration and some industry stakeholders, argue that the bill will help prevent abuse of the transfer system and thus protect state revenues. On the other hand, critics from the motion picture industry fear that the restriction could dampen investment interest and limit the growth of the local film economy. This divergence in perspectives highlights the ongoing tension between ensuring fiscal responsibility and fostering an attractive business environment for potential investors.

Contention

One notable point of contention revolves around the fear of weakening Louisiana's competitive edge in attracting film productions. Industry stakeholders argue that flexible tax credits have played a significant role in drawing filmmakers to the state. Therefore, with the introduction of HB 569, there are concerns that this single-transfer rule may not be enough to maintain or grow the vibrant motion picture sector within Louisiana. Advocates of the bill emphasize the need for stricter controls to minimize financial mismanagement; thus, the discussion continues to probe the balance between regulation and market appeal.