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Should television and movie productions that hire people of colour get bigger tax credits?

The entertainment industry’s difficulties with diversity in front of and behind the camera were headline news throughout this recently concluded Oscar season. And while much of the coverage has been devoted to parsing the numbers that show just how chronic and widespread the problems are, solutions have been slower to emerge from the mass of studies and public statements about the value of diversity.

Academy of Motion Picture Arts and Sciences President Cheryl Boone Isaacs has announced plans to diversify her organization’s voting membership, and a number of studios have moved to hire African-American stars and directors in an effort to respond to the controversies — and perhaps to capitalize on them, given a recent study that suggests that more representative movies make more money.

For New York State Assemblyman Keith Wright, who represents Harlem, the groundswell of attention to diversity is an opportunity to renew a push for a bill that he has been trying to pass for years, one that would offer financial incentives to television shows that hire people of color and women to write and direct episodes.

We are a nation of immigrants, we’re a nation of diversity, and everybody’s got to be able to participate in this American dream

Production tax credits have long been part of the film and television ecosystem: In an effort to lure productions away from the sound stages of Los Angeles, many states pay back to productions a percentage of their expenditures in the state that qualify for the credit. Those expenditures can include the salary a show pays a construction crew to build its sets, or the film stock it buys. In New York, where the program was renewed for another five years in 2013, that credit is 30 per cent, with a 10 per cent “bonus” if that spending takes place in certain Upstate counties.

Traditionally, writers’ and directors’ salaries have not counted as “qualified spending” that is covered by tax credits. (Producers and the compensation for lead actors aren’t usually included either.)

Wright’s bill would change this, making television writers’ and directors’ fees up to $50,000 per episode “eligible costs,” if those writers and directors are members of minority groups or women.

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Productions can claim the maximum credits available to them only if those writers or directors are residents of New York state, a provision that means that Wright and his allies in groups like the Writers Guild of America, East (WGAE) and the Directors Guild of America, as well as unions like the Teamsters and IATSE, can promote it as a jobs-creation bill. These credits would be paid for out of the existing budget; Wright’s bill would cap the payout for writers’ and directors’ salaries at $5 million of the present $420 million budget for tax credits.

“If they look at the bottom line, they see this is a way to make this production viable economically,” WGAE Executive Director Lowell Peterson argues. “Which is not to say they don’t pay attention to us hectoring them about diversity. Putting some money into the equation is even more effective.”

Networks themselves have tried to provide financial incentives for diversity, before, if with mixed results. Though they vary from network to network, these initiatives generally involve channels subsidizing the salaries of entry-level writers from underrepresented groups for a season in the hopes that the experience they acquire will put them in a position to be hired permanently, whether at that show or somewhere else.

But because those writers’ salaries become part of the show’s budget after the year-long subsidy ends, there is actually a financial disincentive to keep the minority writers who participate in the program on staff — they’re no longer free employees. And the subsidies cover only one writer’s salary per show.

“We’ve heard mixed things about that (diversity writer slot) program,” Peterson said. “It tends to be, in practice, a one-year job. … This tax credit would apply for as long as people are on the show or in the industry. We hope it would be more effective than that program. It’s not just one diverse writer per show. It’s however many they are. If you have a room with 12 people in it, and six of them are diverse hires, great. It shouldn’t just be one person.”

We’ve heard mixed things about that (diversity writer slot) program, it tends to be, in practice, a one-year job

This isn’t the first time members of the New York State Assembly and Senate have tried to pass similar legislation. In the 2009-2010 legislative session, both the Assembly and Senate versions stalled in committee; the same result followed in the 2011-2012 and2013-2014 sessions.

This session, however, has shown slightly more progress. Wright’s bill passed the New York State Assembly on June 24, 2015, only to die in the Senate this January, a victim of what Peterson described as “a little bit of chaos” late last year when former Assembly speaker Sheldon Silver and former state Senate majority leader Dean Skelos were both convicted of corruption within a 12-day period. Now, Wright’s bill is waiting for the Assembly to move it forward once again, while in the Senate, Kemp Hannon’s version of the legislation is in the Investigations and Government Operations Committee.

Wright didn’t have a timeline for when he expected the bill might move. Both Peterson and Wright acknowledged that they don’t have a direct commitment from Gov. Andrew Cuomo that he would sign the bill if it were to finally pass — they didn’t try to get it into his budget. And the provision wasn’t included in the 2013 re-authorization of the production tax credit program, which would have been an obvious vehicle for it.

“I always think this is going to be the year that it passes,” Wright acknowledged, though suggesting there might be a special impetus this year. “Certainly, I would hope that quite possibly the situation concerning the Oscars may kick-start it. People are seeing that the industry is all white, and quite frankly, that’s not what America is all about. We are a nation of immigrants, we’re a nation of diversity, and everybody’s got to be able to participate in this American dream.”


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