Growing a More Prosperous Georgia by Design
Once upon a time, Georgians had to travel to Hollywood for a chance to catch a live glimpse of a movie star. These days, we're just as likely to spot a celebrity on the streets of Midtown, at a Dunwoody cafe, or on Jackson's town square. In 2016, 245 feature film and television productions were shot in Georgia, generating an economic impact of more than $7 billion and solidifying the state’s reputation as a place to cost- effectively staff and produce projects for the entertainment industry.
Keeping that success story growing and fueling other entertainment initiatives are the goals behind several bills considered by Georgia legislators this session. One is a measure to incentivize revitalization of fading rural towns, and another would provide new tax breaks to certain entertainment venues. Expanding entertainment options for Georgians, and stemming the tide of music industry losses to other places, are two other proposed measures with the potential to have great financial impact on our state.
Georgia Musical Investment Act
The "Georgia Musical Investment Act," has been in the spotlight since before its formal introduction at the state capitol in January. Despite Georgia's rich supply of musical talent in every genre, industry professionals have become increasingly frustrated with the string of tail lights headed out of Georgia and straight for Nashville. To stop the bleeding and start the building, House Bill 155 proposes incentives designed to retain, create and grow thousands of music jobs in Georgia. According to music industry estimates, the measure could bring $9 million in net revenue and spur $2.2 billion of economic activity in the state within five years.
Highlights of the bill include a 20% tax credit for companies that originate live tours in Georgia. These incentives could attract musical and theatrical touring organizations to the state for auditions, rehearsals and tour kick-offs. This would bring hundreds of industry-specific jobs to the state. To receive credit, the company would have to spend at least $300,000 in the state, whether through staffing, lodging or travel, and the tour must originate in Georgia.
Another feature of the bill is a 15-25% tax credit for all music projects recorded in Georgia that spend a minimum of $100,000. These incentives are designed to attract and retain labels, artists, publishers and production entities that have sizable budgets. Proponents say once Georgia's talented producers, engineers, musicians and music businesses are hired, their performances will quickly build a reputation that creates repeat business.
Thirdly, the Georgia Musical Investment Act provides a 15-25% tax credit for recording of music intended for film, TV or video game production to companies spending a minimum of $250,000. Job creation in this category includes composers, orchestral and session musicians, producers, studio owners and many more.
Supporters of the Georgia Musical Investment Act are hopeful that the bill's incentives will stem the steady loss of talented music students and professionals from Georgia, while creating more than 10,000 job opportunities throughout the state. Factoring in the multiplier effect of those individuals' living expenditures and investment potential substantially elevate the tax credit gains. The bill was passed by the House of Representatives on March 3, and by the Senate on March 30.
Georgia Casino Bill
While hope appears at hand for Georgia-grown musicians, those eager for a local spot to pitch the dice or pull a slot handle are out of luck, for now. For the second consecutive year, a measure that would have legalized casino gambling in Georgia was killed in Senate committee before ever beginning its predicted rocky road in the House.
Senate Resolution 249's intentions sounded virtuous enough; allow a limited number of casino resorts in Georgia with a portion of their revenues going to the HOPE Scholarship program and to rural health care. Many eyes - on both sides of the prize - were assessing possible wins and losses. Proponents calculated big boosts in jobs and economic benefits. MGM Resorts International upped the stakes by publicly considering a $2 billion investment for a metro Atlanta casino resort that would create 5,000 jobs. Opponents, however, worried about "unintended consequences," including an increase in crime and unfair competition for the arts and culture industry. The proposal's chief sponsor, State Senator Brandon Beach, say's he's not giving up. He plans to canvass Georgia this summer to garner support from groups that could benefit from gambling proceeds, and is expected to try his luck again next year.
Georgia Venue Bills
Two bills that are expected to positively impact entertainment venues won approval in the House in February. One would help performance arts facilities run by nonprofit groups planning to renovate or expand. Venues that contain an art museum, theatre or symphonic hall would be given an exemption from state and local sales taxes on the cost of improvements. The sales tax exemption would be capped at $750,000 and be in effect for a two-year period. With one week left in the session, the bill was being considered by the Senate Finance Committee. A second bill doubles the bonding authority of the Georgia World Congress Center - from $200 million, which was set in 1988 - to $400 million. The bill's sponsor, Representative Chuck Efstration, said the increase is needed to manage inflation and continue to generate critical economic benefits from tourism and conventions. The Georgia Senate has overwhelmingly approved the measure and it has been sent to Governor Nathan Deal for his signature.
As Georgians, we are well aware of the many features that make our state a great place in which to live and work. As citizens, we understand the value of taking action to ensure our political climate remains conducive to positive growth in ways that are beneficial for all. Staying abreast of decisions that may impact our businesses is a responsibility we may sometimes let slip. Smith & Howard invites you to stay tuned to this space for updates on issues and outcomes that affect your present as well as your future.