FILM INCENTIVE UPDATE
As reported in last month’s column, Gov. Pataki vetoed the state’s revenue budget bill, which included the film production tax credit. But on April 26, the Senate and Assembly overrode the veto and enacted the extension and expansion of the credit. The state budget office says that Gov. Pataki will not challenge the legislature’s override.
The tax credit provides for up to $60 million in tax credits annually from 2006 through 2011. Additionally, the bill increases New York City’s cap on its film tax credit program to $30 million from $12.5 million. Finally, the bill creates a tax credit allocating $7 million to three classifications — growth, maintenance and upstate New York.
On May 10, Mayor Bloomberg held a press conference with Katherine Oliver, the commissioner of the office of film, theatre and broadcasting. Also attending were councilmembers David Weprin, David Yassky and Dominic Recchia. Bloomberg announced that the administration and the City Council will work to pass a local law reauthorizing and expanding the “Made in NY” tax credit initiative to provide $30 million in city financing annually for local film and television productions through 2011.
The mayor’s office stated that New York City has now become a stand-in for films with story lines that have locations based in other cities. Last year, New York City played host to more than 250 independent and studio films — compared to 200 in 2004 — and 100 television productions. The numbers of shooting days hit an all-time high of 31,570 — a 35 percent increase over 2004, and double that of 2002
“Our administration originally designed the film and television incentives program and fought for it, and we are delighted it has been so successful in generating approximately $500 million in production spending in 2005, and creating thousands of good jobs,” said Bloomberg. “Because of this success, the original allocation of funds has been exhausted earlier than expected. That’s why we suggested not only extending the program beyond 2008, but also increasing the funding before 2008. Since 2002, we have dedicated ourselves to expanding New York City’s entertainment industry, and expansion of the city’s film production tax credit will help keep the industry growing.”
RENT GOING UP? YES, BUT HOW MUCH?
On May 9, the Rent Guidelines Board approved preliminary guidelines for rent increases. For one-year leases, the recommendation was a range of 3 percent to 6.5 percent. For two-year leases, 5 percent to 8.5 percent. The vote was 5 to 4 in favor, despite a large vocal protest. There are nine members including two tenant representatives and two landlord representatives. The final vote on this year’s increase will take place on June 27 but the ultimate percentage will fall under these barometers.
The New York Times reported that these proposed rent increases come at a time when earnings adjusted for inflation have fallen in every borough except Manhattan.
Tenants and tenant advocates filled the building during the tenacious vote chanting and hollering in protest arguing that many of them will be forced to move out of New York City. There are 1.1 million rent-stabilized units in New York City
On May 4, Mayor Bloomberg released the city’s executive budget. The Department of Cultural Affairs’ budget provides for operating expenses of $114.8 million, which is $22.8 million less than the 2006 forecast. The budget priorities include providing core services to the city’s 34 cultural institutions and providing cultural organizations grants totaling $11.2 million, which is $10.5 million less than the 2006 forecast of $21.7 million.
DCA highlighted its financial support of the Snug Harbor Cultural Center’s reconstruction of its music hall, funding for master plan and climate control projects at the Brooklyn Museum of Art, and reconstruction and expansion of the Museum of the Moving Image.
City Council must vote and adopt the budget by June 30.