N.Y. TV/film industry seeks tax break amid recession

By Michelle Nichols

NEW YORK (Reuters) - New York's television and film industry pushed on Monday for a 30 percent production tax credit to be made permanent amid concerns the program could be sacrificed as the state grapples with a $14 billion deficit.

New York state implemented a 10 percent tax credit in 2004 and raised it to 30 percent last year, but $460 million worth of funding, which had been expected to last until 2013, has been exhausted in less than a year and ran out last month.

As a result, Warner Bros. Television has moved production of its hit science-fiction series "Fringe" to Vancouver and no pilot shows are due to be filmed in New York this year, compared with 19 pilots shot in the city last year.

"The program more than pays for itself," Mary Rae Thewlis, a member of the Directors Guild of America, told a news conference on the set of ABC's hit "Life on Mars" TV series.

"These incentives are not charity. They generate revenue at a time when the government is in desperate need of money," said Thewlis, adding that 40 U.S. states now offered production tax credits of 5 percent to 30 percent.

An Ernst and Young report forecast that between 2005 and 2010 television and film productions and related activities were expected to generate about $2.7 billion in state and city tax revenues, compared with an estimated $690 million in state and city credits claimed during the same period.

The industry also created 7,031 direct jobs and 12,481 indirect jobs in 2007, the report showed.

New York City offers a separate 5 percent production tax credit on top of the 30 percent state credit.