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Filmmakers speak out in favor of tax credit
The Iowa Motion Picture Association (IMPA) plans to formally address the growing controversy surrounding film tax credits Monday afternoon at a press conference, with the hope of saving the program from being permanently suspended.
Last week allegations of misconduct surrounding a state tax-credit program for filmmaking led Gov. Culver to suspend the program.
The allegations also caused the director of the Iowa Department of Economic Development, Mike Tramontina, to resign and the state’s film manager, Tom Wheeler, to be placed on paid administrative leave.
“I am very troubled by information very recently received by our office that there have been insufficient procedures in place to assure a full and accurate accounting of expenditures made to enable persons to qualify for tax credits under the program,” Culver said in a statement. “Therefore, until all reasonable questions about the administration of this program are answered, I ask that no further schedules of qualified expenditures be approved nor any further tax credit certificates be issued.”
The IMPA says it agrees that a full audit of the program and new accounting procedures is an appropriate course of action. But suspending the program during the audit is not an appropriate step.
“This is just the second full year of the production incentives and the program is just getting off the ground,” Tammy Shutters, the IMPA’s program director, said in a statement. “There are many films currently in production and planning for production int the state later this year, and by suspending the production incentives the state jeopardizes putting more Iowans out of work while we are facing the highest state unemployment since 1986; as well as discouraging potential future productions from considering Iowa. It simply does not make sense.”
The group points out that as of this week there are three productions shooting in Des Moines, another in Council Bluffs and multiple casting calls and scouting trips.
Supporters of the program say the money filmmakers spend in Iowa to in order to get the tax credits has had a far reaching effect through the economy, ranging from increase spending at local restaurants to work for carpenters and actors. The Des Moines Film Commission says there has been an increase of 16,000-hotel room rentals attributed to filmmakers in the Des Moines area alone.
According to a memo from Tramontana to the governor’s staff, in the two years the tax credit has been available, 20 film projects have been awarded $31 million in credits.
An internal audit of the program found that credits were used to purchase luxury vehicles (a Mercedes and a Land Rover) that were not used directly on the film and the amount of credits claimed was the full purchase price rather than the lease cost during the project. The audit found numerous irregularities, ranging from substandard reporting of how credits were used to using venders who reside outside of Iowa.
The IMPA will formally speak out in favor of the tax credit program Monday at 1 p.m. at the Des Moines Social Club, 1408 Locust St. in downtown Des Moines.