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Georgia lawmakers are taking a long look at film tax credit. This is why it matters in Hall
0903 Ozark series
This image released by Netflix shows Jason Bateman in a scene from the series, "Ozark," which does much of its filming in Hall County around Lake Lanier. - photo by Associated Press

From “Baby Driver” to Netflix’s “Ozark,” Hall County has been an occasional second home for Hollywood.

And it’s a home that Stacey Dickson, president of the Lake Lanier Convention & Visitors Bureau, would like to see maintained.

“If Georgia were to cancel the film tax credit, we would very likely see projects like this go elsewhere to film,” she said.

A few projects shot in Hall
  • Rampage,” a 2018 movie starring Dwayne “The Rock” Johnson, shot scenes on or near the campus of Brenau University.

  • Baby Driver,” a 2017 movie starring Ansel Elgort, Kevin Spacey, Lily James, Elza Gonzales, Jon Hamm and Jamie Foxx, shot scenes at the old Regions Bank on Green Street.

  • Ozark,” a Netflix series that started in 2017 and stars Jason Bateman, Laura Linney, is shot on parts of Lake Lanier.

  • Thank You for Your Service,” a 2017 movie starring Miles Teller, was shot scenes at the old Regions Bank on Green Street.

The popular but expensive state tax credit, which has come under scrutiny after a state audit showed lax oversight, has emerged as a hot topic in this year’s legislative session, which got underway Jan. 13.

The audit, conducted by the Georgia Department of Audits and Accounts and released earlier this month, “brought to light some very serious issues that we need to take a look at, no doubt,” said state Rep. Timothy Barr, R-Lawrenceville, who represents part of South Hall and is a member of the House Working Group on Creative Arts & Entertainment.

“We have definitely talked about different ways to make this work better for Georgia. Do we need to audit every single (film) project? Possibly.”

The tax credits have grown from $141 million in 2010 to an estimated $870 million in 2019.

“Nobody foresaw how quickly this (industry) would grow and what an economic boom it would be,” Barr said.

But state auditors say that some companies have received film tax credits they did not earn.

Auditors found millions of dollars in ineligible expenditures by film companies, including payments to workers or contractors for work that was done outside Georgia.

“Deficiencies in the credit’s administrative controls and the significant financial benefit provided by the credit create an environment ideal for fraud,” auditors wrote.

The audit found that the state lacks an adequate system to prevent improper granting of credits.

The auditors also noted the production companies can sell the credits for a higher premium. 

Georgia requires companies to provide less documentation than any of the 31 other states with a film tax incentive, auditors wrote. Hundreds of projects annually receive the credits.

State officials say the industry has created and maintained tens of thousands of jobs in Georgia, though some researchers say boosters have exaggerated the impact of the tax credit.

“If the state continues the film tax credit program and refines the process by which eligible projects receive tax credits, I hope they will consider a mechanism to be able to share data with local communities,” Dickson said. 

“The current system doesn't provide any data at the local level for Camera Ready Communities like ours to be able to verify what projects have filmed our communities and their value.”

She added: “Having better accountability for this program is a path forward to sustaining it. Without a doubt, Georgia’s film tax credit program has caused a boom in the entertainment industry seeing our state as a viable place to do business.

“This has caused long-term commitments to be made, including infrastructure development, production facilities and the relocation of professionals who work in technical support of film to Georgia as their new home.”

State Sen. Butch Miller, R-Gainesville, said that overall the tax credit has been a boon for Georgia.

“But as a taxpayer and a steward of the state’s taxpayer dollars, I’m envious of every penny the state pays out,” he said. “We need to tweak it and reform (the credit), but let’s not throw the baby out with the bathwater. 

“In the end, the better controls are worthwhile, so we can be sure the expenditures are getting the full benefit of our tax dollars — and those (expenses) that are ineligible are not getting the benefit of tax dollars.”

Miller also noted that “by the audit’s own figures, there was $4 billion in economic impact and $3 billion in net impact — and $3 billion is nothing to sneeze at.”

A Georgia Tech study released earlier this month showed that the film industry’s spending hit $4.2 billion in fiscal 2017.

“We can safely assume that the direct spending, which goes to local businesses large and small, has grown even more in the last two years,” said Kelsey Moore, executive director of the Georgia Screen Entertainment Coalition.

Still, the audit contains several recommendations for legislators, including that they cap the film tax credit to reduce the fiscal risk to the state. 

“Other matters for consideration include changing credit provisions to reduce credits for wages paid to out-of-state workers, requiring periodic evaluations of the credit, and allowing public disclosure of credit recipients and amounts,” the audit states.

Barr expects legislation to come, even as lawmakers are planning 4% agency and department cuts this fiscal year, which ends June 30, and 6% cuts next fiscal year, which begins July 1.

“We’re definitely in the beginning stages of looking at what makes sense and how to make it work,” he said.

The Associated Press contributed to this report.

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