‘Sleepy Hollow’ to leave North Carolina after loss of production tax incentives

Originally published on foxct.com on 1/20/15


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HARTFORD – Sleepy Hollow is currently wrapping its second season along the coast of Wilmington, North Carolina, where every episode of the FOX series has previously been filmed.  According to Wilmington officials, however, this will be the last season Sleepy Hollow is filmed in the town should FOX decide to pick up the series for a third season.

Wilmington Mayor Bill Saffo blames the loss of the series, which he refers to as “devastating”, on North Carolina lawmakers who have decided against renewing the state’s tax incentives for film and TV productions, replacing the 25% refund on qualified production spending with a $10 million grant program available for only the first six months of 2015.  Saffo went on to say that it’s part of a snowball of production losses, as TV and film inquiries are down more than 80% since the change, considering producers have applied for over $62.2 million credits in previous years, including nearly $1.5 million for Sleepy Hollow, alone.

Connecticut made a similar change in 2013, temporarily suspending the state’s film tax benefit program for two years after handing out over $137.4 million in tax breaks to production studios since the program’s inception .  Despite touting the credits as job and investment opportunities for Connecticut residents, state officials realized that when placed against a $1.5 billion budget shortfall for the 2014 year, the program provided few real benefits.

In fact, film tax credit programs have become increasingly less popular across many states since 2010, when a record 40 states offered over $1.4 billion in incentives between them.  After that peak year, 8 states completely dropped the program, with more and more following suit in the following years.    Interestingly enough, as evidenced by Wilmington officials and officials in various Connecticut towns, while the halting of the programs seem to benefit the respective states as a whole, the specific towns that were benefiting from the production companies’ presence are the ones who are really feeling their loss.

“We’re feeling it.  We’re seeing the effects of it, and when you’re in a competitive mode where we’ve lost [other businesses] that were even thinking about coming here, it seems we’ve put out a sign that says North Carolina is not open for business,” Saffo said.

Despite suspending their film tax benefit program, Connecticut has continued to fund television production enterprises, like ESPN, as they bring a more constant presence to the area.  Movie production enterprises, which often require specialized skills and force production studios to bring out-of-state workers along with them, do not generate long-term economic growth.  Connecticut’s two year suspension of their film tax benefit program ends this year, so renewal will be up for debate once again. However, since 1991, Connecticut has consistently had one of the highest tax burdens in the nation, and the renewal of the film tax benefit program most likely would not do much to help that.

In the meantime, Sleepy Hollow will leave its Wilmington, North Carolina home and head to Georgia, whose state production tax credits offer a 30% break with no limits or caps on Georgia spend, contingent, of course, upon FOX renewing the drama show for its third season.

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