Governor Cuomo Just Vetoed a Major Diversity Tax Incentive for Filmmakers and His Explanation Makes No Sense
Among the many diversity initiatives in the film and television industries, the New York State diversity tax incentive has always stood out as a promising piece of legislation that could instigate real change, since it was designed to allocate $5 million to television productions that hired more women and people of color.
Unfortunately, after sailing through the State Legislature and enjoying overwhelming support within the industry, Governor Andrew Cuomo vetoed the $5 million bill today. To date, much of his reasoning for the decision has been head–scratching, tone deaf, and dishonest.
To see how the incentive could make a difference, it’s important to understand just how powerful tax incentives have become in shaping Hollywood’s decisions. In New York, the 30% kickback on below-the-line production costs has led to an unparalleled and ever-growing number of productions in New York City, where there are now close to 60 scripted television shows, many of which are being pushed to the very edges of the five boroughs just to find a qualified stage to shoot on.
Georgia and New Mexico, two states with sizable incentives, have seen an equally unparalleled production growth, while many major Hollywood films will move to tax incentivized production hubs like London, Germany and South Africa over remaining in California, where the tax kickbacks are rationed via a lottery system.
Writers and directors’ salaries are considered above-the-line items on the budget and are not part of the New York tax incentive. The idea behind the state’s diversity initiative was to take $5 million and extend the rebate to the salaries paid to women and minority television writers and directors. In other words, the studios are incentivized to hire diverse creative teams because they can save on their salaries. If a 30% saving convinces a producer to fake Chicago by shooting in New York, or to move his family to Atlanta or Albuquerque for eight months a year to shoot a TV show, it stands to reason he would also take a harder look at hiring a young African American woman to be in the writer’s room or shoot an episode. And it’s those type of opportunities that can make all the difference for a young creative on the outside-looking-in on the world of television.
In defending his veto today, Governor Cuomo himself highlighted the success of the tax incentive when he discussed how “over-subscribed” the $420 million program had become, and certainly the additional $5 million needs to come from somewhere. One might have expected Cuomo to talk about how the diversity incentive, as the bill is written, would take money that was designated to fight inequality statewide and put it in Hollywood’s pocket, but that would have been way too logical an argument for the Governor today.
In laying out his concerns about how the bill would be implemented, Cuomo highlighted how the legislature failed to give a clear definition of “writer” or “director.” It’s a statement that the Writers and Directors Guild – both vocal sponsors of the bill that slammed the Governor’s veto – would find humous if it wasn’t so insulting to their strictly enforced rules regarding membership and on-screen credit. But the Governor’s lack of seriousness became even more apparent with this statement about the bill:
“The bill lacks statistical evidence necessary to ensure that the program would withstand constitutional scrutiny. In order to constitutionally classify individuals on the basis of race or ethnicity, the state must demonstrate statistically significant evidence of race-based discrimination against screenwriters and directors.”
Evidence? Turn on your TV, Mr. Governor. The only thing Hollywood has effectively done in the area of diversity is come up different stats to show just how bad they are at diversity. And so many of those problems stem from — wait for it — the lack of diversity among writers and directors, who create white, male-dominated stories. According to the WGA’s own numbers, female writers (29%) and minority writers (13%) make up an extremely low percentage of those working in episodic television. In New York, which hosts a majority of the late-night comedy talk shows, Complex conducted a survey concluding that — among the 155 writing jobs those shows create — only eight had gone to women of color.
But don’t worry. The Governor has the answer, and it lies with another study:
“Notwithstanding these concerns, I am directing the Empire State Development Corporation to work with bill sponsors and interested stakeholders to assist in the development of a study that would determine whether there is a statistically significant disparity between the number of minority group members and women ready, willing, and able to work as writers in the television industry in New York state and the statistical share of writing work actually performed by such group.”
Unpack that statement and it puts you on your heels. Did the Democratic Governor of New York just say that, or was it Jeff Sessions? More than anything, the Governor undermined his own fiscal and budgetary concerns with a statement that’s either ignorant of the legislation he vetoed, or intellectually dishonest. He continued:
“I am also concerned that the bill seeks to provide an incentive for above-the-line production costs, which is contrary to the existing film production tax credit program. New York’s film and TV production tax incentives are aimed not at Hollywood stars and producers, but rather to individuals who work steadily on set and in post-production who are seeking increased employment opportunities and advancement within the state. For these reasons, I am constrained to veto this bill.”
On one level, Cuomo is right: New York City does lose out on large Marvel movies, or a films like “Anchorman,” to Atlanta because Hollywood can save 30% on the high-priced salaries of those movies’ stars, directors, producers and writers. In New York, they only save on the salaries of the hard-working New York crew they hire and the millions they spend shooting here. But this bill was never going to open the door for the next “Black Panther” to come rushing to New York to save on Ryan Coogler and its minority stars’ salaries. That wasn’t the goal.
First off, the bill doesn’t offer savings on actors’ salaries. More importantly, unlike below-the-line costs, the diversity program was always designed to put a cap on the size of the incentive. Even on a 24-episode TV series, the incentive maxes out at $50,000 per writer and $75,000 per director.
That’s not money that will cause a production to switch cities, but it would create many job opportunities for women and people of color looking to direct television. And New York’s Governor just threw that away.
