Nevada's Film Tax Credit legislation meets its demise in the Senate
Las Vegas' Dead Dream: The Fall of Nevada's Billion-Dollar Movie Studio Scheme
Gather round, folks! Let's chat about the recent drama going down in the high stakes game of politics and money in Nevada. The state'sAssembly Bill 238 (AB 238) has gone up in smoke, y'all, putting an end to a daring plan to shovel nearly $2 billion in public funds to construct a new Hollywood studio. This babydied in the Senate, squashing hopes of a silver screen spectacle in the Silver State.
Economic Dreams, Hollywood Style
AB 238 was the wild card in Sin City, promising a cool $1.4 billion in transferable tax credits to big guns like Sony Pictures Entertainment and Warner Bros. Discovery, allowing these media titans to roll the dice and set up shop in Nevada. This smooth deal also included a twentyfold increase in the state's film tax breaks, granting an eye-popping $120 million per year for 15 years, starting in 2028.
In total, these studios would've reeled in $1.8 billion in public subsidies. The proposed Summerlin Production Studios, located in the same neighborhood as Vegas' iconic tourist strip, would've seen the largest public funding in Nevada's history, surpassing the $1.25 billion Tesla Motors raked in back in 2014.
Proponents of this plan pledged that this production palace would become a major economic corkscrew, spurring Nevada's revenue like never before.
Authority Slaps the Cards Down
Last week, the Assembly put AB 238 through its paces and, by the skin of its teeth, the measure squeezed by with 22 votes in favor of the gambit and a mere 20 votes against.
Detractors of the plan were grizzled gamblers, fearing the house would take it on the chin. While most agreed the bill would stir up some economic activity, they questioned whether this would be enough to cover the costs.
The Governor's Office of Economic Development ordered a report on the deal. It found that for every dollar spent on tax credits, the state would net only 52 cents in taxes. A separate study from proponents of the measure, however, painted a rosier picture—albeit admitting that much of the expected jackpot would be more like loose change dropped into a slot machine.
The Shootout: Senate vs. AB 238
It was Monday when the bill sauntered up to the bright lights of the Nevada Senate—but it didn't stand a chance. Desperate moves to merge AB 238 with a sister bill (SB 220) were made, but the plan crashed and burned, squashing dreams of a massive movie studio in Nevada for the time being. Proponents of AB 238 will have to wait until 2027 to place another bet on a similar scheme.
For the record, SB 220 aimed to create a separate studio at UNLV's Harry Reid Technology and Research Park, unlike AB 238, which was all about partnering with major movie studios.
Bonus Round: Facts & Figures Edition
- [Economic Impact]: The Summerlin Studios project was shaping up to bring a $3 billion economic splash to Nevada, setting it apart as one of the largest economic development initiatives in the Silver State's recent history.
- [Film Tax Credits]: AB 238 proposed doling out $95 million annually in transferable film tax credits for 15 years, with a total net tax credit of $1.4 billion over the period.
- [Investment Requirements]: Production companies needed to invest $4.5 billion across 15 years, with certain spending guarantees at different junctures. Underperformers might find themselves owing the state repayments.
Politics and general news continue to follow the demise of Nevada's Assembly Bill 238 (AB 238), a legislative proposal aimed at providing substantial tax credits for Hollywood studios to establish facilities in the state. This move was part of a larger policy-and-legislation strategy to boost Nevada's economy. Despite managed approval by the Assembly, the bill encountered strong opposition in the Senate, subsequently failing to materialize as a $2 billion movie studio in the Silver State.
