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Arkansas Law To Offer New Tax Incentive For Film Industry

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Arkansas Cinema Society
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A new Arkansas law passed by the legislature with little dissent and signed by the governor in April creates a new tax incentive for the film industry in Arkansas.

KUAR spoke with Kathryn Tucker, executive director of the Arkansas Cinema Society and Christina McLarty Arquette, producer and board member of the Arkansas Cinema Society about the new credit and how they hope it will bring more film projects to the Natural State. Below is a transcript of the aired conversation.

KUAR: Can you give me an overall breakdown of Act 797. What does it do and why do you think it was needed?

Tucker: "This process began about two years ago and I, as a filmmaker, before I started the Arkansas Cinema Society, I was trying to live and work in Arkansas. And the current rebate system that we currently have has done a great job at creating all of the work in the film community that is there now. But unfortunately I noticed, I produced a couple of films, one in 2014 and one in 2016 and several little shorts in between and I would always take interns, often times up to 15 interns on a project and we would train them. Then I would notice that all of those interns would take their experience and have to move.

And there’s a handful of filmmakers who have been able to make it work in Arkansas and they’re all friends of mine and I have so much respect for them and their persistence. But a lot of them do a lot of commercials and other jobs just to kind of fill in the gaps in between these incentivized projects like True Detective Season 3 or like the movie I produced Antiquities. And so what happens is all of this great training, without sustainable back to back productions where a movie’s over and then there’s another one to jump onto, of course all of the Arkansas homegrown talent has to leave.

I started kind of personally getting into it a little bit, even before the Arkansas Cinema Society, looking at states like Georgia and New Mexico to see why those film communities and economies and industries there were exploding. And I kind of noticed the pattern that they all had this tax credit incentive as opposed to like a cash back, a cash outlay, which is what Arkansas has.

The idea for the tax credit is that there’s not like an outlay of cash on the front end and the movies bring in new money. So, it’s money that wouldn’t have been there to begin with. So, a movie comes in and brings in $40 of tax revenue so then basically the state is saying, ‘Thank you for the $40 of tax revenue, you don’t owe us $30 of that later.’ So the state is essentially still netting $10 and it’s money that wasn’t there to begin with, had the movie not shot there in the first place.”

Arquette: "A great classic example I love to use is, and I’m a huge fan of his, is Clark Duke. He’s from Hot Springs, Arkansas originally, and he had his film titled Arkansas, which was his directorial debut. He wrote it and wanted to direct it and bring it home to Arkansas, it was his greatest dream. And he had been approved for the rebate and then unfortunately something happened before he could shoot and he no longer had that rebate so he had to set up shop in Alabama.

That’s such a powerful example of like, you know, this film should’ve been shot in Arkansas. So the tax credit option, now we have this option of a rebate or a tax credit. Had that existed then, Clark would’ve been able still shoot Arkansas in Arkansas and it would’ve just been such a meaningful experience for him. So it’s a great example of like why this new law is really wonderful. “It streamlines a lot of things for filmmakers. It helps support filmmakers run and sustain and keep and grow jobs in Arkansas. When a film cuts production, it’s not just the actors and the cast. It’s all sorts of folks from hairdressers to electricians to carpenters and building sets. So this kind of halo effect of the amount of jobs it creates per production is really exciting to us."

KUAR: What do you feel are going to be some immediate benefits to the new law. I know it won’t go into effect…until 90 days after the legislature [went on its recess] last week. But do you already kind of hear a buzz? Do you hear the industry talking about this?

Tucker: "One of the things I wanted the Arkansas Cinema Society to do when I started it was kind of pool Arkansas’ resources. Because I feel like if we do that we can really make change and something that I have seen with this new incentive is a real unifying of all of the filmmakers in the state, kind of like an outcry of ‘hip hip hooray.’ We’re making progress and we’re able to actually recruit some projects to the state now. So it’s been really a great feeling."

Arquette: "To have homegrown talent stay home and be able to work from home and do things they love in their home state and that’s I think, everybody feels really passionate about that."

KUAR: Georgia recently made headlines with the Will Smith produced film [Emancipation], pulling out of Georgia due to its voting laws. Are you at all concerned that some of the bills that have recently passed in Arkansas whether they be on voting, whether they be bills on the trans[gender] community, are you worried that that could lead to films not deciding to film here?

Tucker: "I think yes, but I also think, while I understand why Will Smith pulled out and I think a lot of those evacuations, I understand them and that’s kind of the power that they have. But in a lot of ways, I think a lot of producers know that that really only hurts the crew they were going to hire. And so I think, because a lot of those crew that live in Georgia lost a job and they’re not responsible for the voting rights laws. So while it does make a huge statement, and I think that’s so important, I think there’s two sides of the coin and I appreciate both sides of that coin."

Arquette: "I think it’s a really important question and it’s one I probably could never give the right answer to because you know, again it’s so important for, especially somebody like Will Smith to use his platform to stand up for what he believes in and make a statement and that’s a really powerful one. So I think obviously it’s up to the filmmakers and producers and everybody to where they want to film and why they might not want to film there. And on the other side of that, yeah I totally agree Kathryn, that the loss of jobs is very impactful as well and our whole goal is to create and grow jobs."

KUAR: You’ve talked about this a little bit, but what do you think the impact of this will have on Arkansas in the long run?

Tucker: "It does take time to build up a film economy and I think this, a lot of this is kind of stacking on top of what the rebate was able to create, but really the idea is sustainability and more projects, more back to back projects that we can sustain through in the state."

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