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Lights, camera... Alaska!

Tax credit program is vital for state's economy, image

Posted: August 6, 2011 - 7:39pm

Alaska has been featured prominently in the national and international media. From the soon-to-be-released feature film “Everybody Loves Whales” to a panoply of reality television shows, the Last Frontier has become a popular and vital venue for the creation of movies and other screen-based stories. This is mostly to be attributed to the unique beauty of the land we are fortunate to call home, but also because of some specific choices made by the Alaska Legislature.

In 2008 a bill was passed that allows companies that undertake production of film and television projects to apply for corporate income tax credits from the state of Alaska. As most of us are unaccustomed to paying taxes to our state government, this may at first blush seem to be an odd concept. But as fortunate as we all are not to pay a state income tax like almost all of our fellow Americans, corporations in Alaska do pay annual taxes, and thus there is a real market for the tax credit certificates for which the law allows for movie-makers to apply.

Since the Alaska Film & Television Production Incentive Program came into being, it has had demonstrable impacts on this sector of the economy. As the chairman of the Alaska State Council on the Arts, I have been focused more and more in recent years on the concept of the creative economy. All across the country, those involved in economic development and in arts advocacy have tried to concentrate analytical attention on the jobs and positive economic effects of industrial activity that involves the creation of ideas and the use of human imagination. From writing to painting to theatre, music, and dance, all these things that are conventionally considered the arts are also now looked as drivers of prosperity and private and public revenue. Film and television fall squarely into this category of what people do, and what government ought to encourage them to do more.

Many other states have had film and television-friendly tax regimes for years, from New York to Hawaii, and there have been undeniable results in terms of what we see at the cinema and on our small screens at home. With the onset of the recession, some other jurisdictions have started to cut back on the tax credits at the same time that Alaska has ramped up its program, to our benefit and reflexively to their detriment.

Stories that are set in wild and beautiful venues ought to be filmed in Alaska. But for years many projects, including the long-running show Northern Exposure, were not created here, but in other locales nationally and internationally that were substituted for the Great Land. This does not and should not be the case.

When our elected leaders created the tax-credit program, they set strict standards for companies seeking to benefit from the system, and also set time limit on how long the program would last. It is currently set to expire in a few years. Now that the program is up and running, and has proven that it works and creates real, tangible, and quite positive economic effects, it is time for it to be improved and extended.

Senate Bill 23 was introduced in this year’s legislative session, and moved through the Legislature’s upper body swiftly and with broad support. In the House of Representatives this legislation received some heightened scrutiny, and is now parked in the House Finance Committee. Some eminently reasonable questions have been asked about the effect of media productions that portray Alaska as an environmental treasure (which it certainly is) on our ability to develop our natural resources responsibly in the way we must to provide for our economic well-being. Thus a specific criterion was added to the law that allows the Alaska Film Office to consider whether a project that might receive a tax credit is anti-development propaganda unworthy of state support. With this and some other relatively small changes, the film tax-credit program is now ready to continue working to help create jobs and creative opportunities for many more years. SB 23 will extend the statutory life of the tax-credit regime out until 2023, and demand more transparency and accountability from the companies that seek to benefit from its existence. A hearing will take place this fall on the measure, and I am hopeful that when the Legislature reconvenes in January, the bill will move quickly forward to the full House of Representatives where it should pass handily. As the Commissioner of Commerce, Community & Economic Development wrote earlier this year in support of this legislation, Alaska is ready for her close-up. It’s time for lights, camera, and action.

• Brown is an attorney who lives in Juneau.

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