Few issues in New Mexico public policy are as frustrating to deal with as have been the State’s generous film subsidies. Prior to the 2019 legislative session New Mexico’s annual subsidy was capped at $50 million annually. The Legislature passed SB 2 this session which raised the subsidy total to $110 million annually for some and removed the limit entirely for others (based in New Mexico).
This was dutifully described as “great news” by the film-friendly New Mexico media.
But how about people like the Legislative Finance Committee, the Legislature’s own analysts? What do they have to say about the expanded film subsidies? The following slide from a presentation by Rep. Patricia Lundstrom (vice chair of the LFC) and LFC director David Abbey.
A $500 million additional cost due to the expanded subsidies and an estimated 40 cent return on each dollar spent is in line with what RGF has previously said about the program, but policymakers in New Mexico have ignored this. Of course, as long as oil prices and production remain high, the State’s financial condition will be fine.
The full presentation is available here. It contains lots of interesting fodder for future posts.