Tax Credit Scandal Worries Louisiana Film Industry

LIFT threatened to take The Film Factory, its proposed $100M+ 300,000 s.f. studio/school facility, elsewhere if state officials did not speed up its tax credit claims

It's been a while since I wrote about film tax credits, but here's a doozy: last week, the FBI raided the offices of the Louisiana Institute of Film and Technology (LIFT), purportedly New Orleans' most prominent film production company ("Factory Girl" and "Bug" are among its recent films). Why? Apparently, LIFT head Malcolm Petal pressured state economic development officials to speed up the processing of his company's tax credit applications or else he'd take his proposed $100 million-plus film studio facility elsewhere.

The FBI raid may have been prompted by a whistleblower lawsuit filed in February against the state economic development department alleging that an official there gave LIFT favorable tax credit treatment in exchange for bribes and kickbacks.

These recent events are worrying Louisiana's film industry leaders. Since the state's first round of film tax credits took effect in 2003, $2 billion in production expenditures have been spent, putting the state at the #3 spot in level of production after California and New York. Could corruption and greed bring it all down?

>> FBI raids film offices as tax probe widens [New Orleans Times-Picayune, 6/2/07]
>> LIFT officials pressured state to speed tax credits [N.O. Times-Picayune, 6/4/07]
>> Are we dumping the baby with the bathwater? [N.O. Times-Picayune, 6/5/07]
>> FBI investigation in New Orleans worries local film industry leaders [The Shreveport Times, 6/5/07]

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