* Gov. Rod Blagojevich has been one of the top cheerleaders for the movie industry tax credit, which was just recently renewed by the General Assembly. But…
…at least 30 other states are facing budget deficits besides Illinois, legislators have been pushing to subsidize some of America’s most affluent businesspeople at the expense of taxpayers. At least 40 states currently offer film subsidies, some offering upward of 30 percent to 42 percent of a movie’s production costs.
These tax credits do not pay for themselves, much less bring in extra revenue. Greg Albrecht, chief economist for Louisiana’s Legislative Fiscal Office, estimated in 2004 “that for every dollar of revenue lost to film tax credits,” only 15 to 20 cents “of revenue would be recovered from tax receipts generated by stimulated economic activity.”
According to Albrecht, even the most “successful” film subsidy programs bring little value. In Louisiana, he found, “even if 100 percent of the reported production budget amounts were being spent purchasing goods and services from Louisiana suppliers, the economic benefits would not be sufficient to provide tax receipts approaching a level necessary to offset the costs of the tax credits.”
The jobs and economic growth created by film productions with the help of such tax incentives are often overstated. The New England Public Policy Center at the Federal Reserve Bank of Boston found that “when film tax credits do hit their mark and induce more local film production, the resulting stimulus to overall economic activity appears to be rather modest.”
The tax credit may have more to do with the governor’s Hollywood fundraising and the international cachet for Chicago. Still, the movie tax credits have “worked” to the extent that far more films are being shot in Chicago than before the credit was approved. That’s a good argument for keeping it in place.
* However, while the glitz and the glamour are given governmental favor, Downstate gets the shaft…
Gov. Rod Blagojevich says Illinois residents should know he didn’t want to shutter seven state parks and a dozen historic sites, but he needed to make the closings to balance the budget.
Blagojevich put out the statement Sunday, the same day the parks and historic sites were to close. In the statement, the governor asked Illinoisans to understand that the closings had to be made to offset a $2 billion budget deficit.
The governor said he would “continue to take steps to reduce the shortfall so that Illinois has a budget that works.”
We’re talking about $2 million here. That’s a rounding error on a rounding error.
* These parks and sites are far more economically important to small Downstate communities than the movie industry is to Chicago…
By the end of [yesterday], the gates will also close at Castle Rock and Lowden state parks, two of the strongest drawing cards for businesses in nearby Oregon, Ill., about 100 miles west of Chicago.
“Gas, grocery stores, motels, resorts,” said Marcia Heuer, executive director of the Oregon Area Chamber of Commerce, rattling off local businesses that depend on park visitors.
The two parks draw just shy of 400,000 people a year, and are the cornerstone of the chamber’s marketing, she said, particularly the 48-foot-tall statue, 100-ton statue, The Eternal Indian, at Lowden.
Yet, they get nothing.
* And it’s not just state parks and historic sites feeling the pain…
“Politicians are fond of criticizing deadbeat parents who refuse to meet their obligations, but state government is becoming the biggest deadbeat of all,” alleged the Rev. Frederick Aigner, president of Lutheran Social Services of Illinois, in a prepared statement last week.
He decried the state’s almost $9 million in unpaid reimbursements to the organization for family and community service work.
“If the state doesn’t move quickly, we and many others across Illinois are going to be forced to make drastic cuts in services that will hurt every community in the state,” Aigner wrote.
* Universities were hit last week as well…
The Blagojevich administration is asking Illinois’ universities to place 2.5 percent of their budgets in reserves. The cuts mean four-year universities would lose nearly $35 million from their budgets. The state’s community colleges would drop nearly $8 million.
University of Illinois spokesman Tom Hardy says the school’s president, Joe White, told the campuses to prepare for cuts earlier this fall. Campus officials were to present contingency plans to White by next month. The Chicago campus already announced it was cutting 200 jobs at its medical center.
* But, like the state, the U of I still funds the glitz and glamour…
With oversize leather chairs, Oriental rugs, computer labs and classrooms, the Irwin Academic Services Center is a great place to study - if you’re an athlete.
The $6 million University of Illinois tutoring center helps only about 550 of the school’s 37,000 students. […]
The UofI center, with an annual budget of nearly $1 million, is staffed with tutors, counselors and learning specialists like Debby Roberts.
* Related…
* Gov to transit agencies: Hike fares, I’ll freeze pay
* Budget troubles raise plenty of questions
* SJ-R Opinion: Governor’s delusions catch up to us
* Illinois’ budgetary ‘Doomsday’ hits home with layoff, site closures
* Historic sites, some parks to close after Sunday
* State park closings a tough pill for some to swallow
* Unjust governor ignores will of the people
* Blagojevich taps deputy gov Martinez