How Fayette will profit big from an 8-year-old tax law
State tax credit helps blockbuster studio deal
News broke last week that world-famous Pinewood Studios of London is brokering a deal to develop what would become the largest movie studio in Georgia right in the middle of rural Fayette County ... and a short distance from Piedmont Fayette Hospital.
The groundwork for such a blockbuster is rooted in large part in state tax credits championed by former state Senator Mitch Seabaugh of neighboring Sharpsburg back in 2004.
Seabaugh, who is now the state’s deputy treasurer, recalled that the idea began with a request from Paul Lombardi and Scott Tigchelaar of Raleigh Studios in Senoia as they wanted to involve more students from the Central Education Center career academy in Newnan in their part of the movie business.
The idea blossomed from there, taking Seabaugh to meetings in California with a number of production studios, including Disney, Warner Brothers and Sony Pictures and more. Their big wish was for the tax credit to be simple, Seabaugh said.
“The difference is that our state is not putting out money,” to lure productions here, Seabaugh said. “They come here and spend money and we rebate a portion of the tax revenue they generate in income tax credit.”
The studios can qualify for up to 30 percent in those income tax credits, which is in essence rebated to the studios after the production ends.
“The very important thing is that no tax dollars are laid out for a production to come,” Seabaugh said. “They are only rebated the taxes in part, and extensive studies show there is more tax revenue generated than given back in the tax credits.”
The studios can sell the tax credits to people who have an income tax liability, who use the credit to pay off their taxes, Seabaugh said.
“It is generating jobs and spending that you are now seeing here in a big way,” Seabaugh said. “... Local communities really make out very well because they’re not funding any tax incentive but they are getting local tax revenue as a benefit.
The TV/movie production industry spends money in local restaurants and rental stores, along with home improvement stores for goods used in set design, Seabaugh said. The bigger spinoff however has been that of additional jobs for people who are now moving here.
“There are people living here who have moved to Georgia to make roots, buying homes and putting money throughout the community with money they are spending,” Seabaugh said, citing a stuntman he has met who is moving here from Idaho. “These are people not just coming here and working and spending money, but also coming to live in Georgia because of the production. That’s more money that goes through our economy and helps to generate tax revenues.”
The new jobs are for far more than the theatrical type, Seabaugh noted. That’s because the industry needs technical laborers skilled in carpentry, electronics, cosmetology and food service, to name a few, he added.
The tax credit helped lure Raleigh studios, which has since become the home for “The Walking Dead” television series on AMC, and coincidentally the top-ranked drama on cable television. Many of the scenes from the past season were shot in downtown Senoia, which has come to look the part of a zombie apocalypse with the little touches, including unkempt landscape islands through the heart of town.
Seabaugh said he has been to “The Walking Dead” set several times, noting in particular a barn that was built from scratch to look like a 70-year old farmhouse. Yet he is reticent to take sole credit for the tax credit concept that has brought Georgia back to fourth in the nation as a site for TV and movie production.
The idea was really rooted with Tigchelaar and Lombardi, Seabaugh said. Beyond that, “it took a lot of people to make it be a successful program,” he added.
“I’m glad to see a lot of people stand back and smile and say, ‘That’s one of the really good things we’ve done over the past few years,’” Seabaugh said, adding that he is particularly excited about the creation of jobs in the state.
“This is one of many things I feel very good looking back and feel very fortunate to have had the opportunity to be a part of,” Seabaugh said.
Pinewood Studios is perhaps best known for its role in the James Bond film series, and the company plans to initially build five state of the art sound stages and ancillary development for a total investment of $20 million. The hope is for construction to start this spring if permits are approved.
Preliminary ideas for the $20 million development include production offices, initial production stages, a mill works shop, a film school, a continuing education center, administration offices and a catering and culinary school, The Citizen has learned. While the studio has a reputation for world-class films, the Fayette location would focus on high quality television productions.
Upwards of 500,000 square feet of sound stages, production facilities and ancillary offices are envisioned for the site, The Citizen has learned. The rezoning plans show at least eight such larger structures in addition to clusters of smaller buildings. Zoning being sought is GB (general business).
Preliminary plans ask for rezoning to accommodate 381 paved parking spaces.
The 30-acre campus of River’s Elementary School will also play a role in the overall development, although no final deal has been reached on the property owned by the Fayette County Board of Education. The elementary school is expected to receive a makeover and become a campus of Savannah College of Arts and Design, though talks are active with other higher learning institutions, according to the Fayette County Development Authority.
“Future development plans do include the establishment of a professional film production school in partnership with the studio to help grow Georgia’s film workforce,” according to an FCDA news release.