Viva Las Vegas film credits

By Robert E. Lang and William E. Brown Jr.

Sunday, Sept. 28, 2014 | 2:03 a.m.

Fifty years ago, MGM Studios released “Viva Las Vegas,” featuring two of the biggest stars of the 1960s — Elvis Presley and Ann-Margret. There was a third star, too — Las Vegas itself. “Viva Las Vegas,” with its hit song of the same name, showed our emerging metropolis at its fun-filled best. It was an 85-minute commercial for Southern Nevada — from Lake Mead to Mount Charleston.

Most importantly, Viva Las Vegas showed the true — and almost incalculable — value of films set here, promoting Las Vegas to our global tourism market. More recently, films such as an update of “Ocean’s 11” and “The Hangover” introduced another generation of moviegoers to Las Vegas.

Understanding the value of movie-industry jobs in Southern Nevada and the sheer promotional value of films shot here, the Nevada Legislature in 2013 established a film tax credit program to attract the industry.

Offering the film industry a carrot to do business here made full sense. It is specifically identified as a sector ripe for development in a study commissioned in 2011 by the Governor’s Office of Economic Development and conducted by the Brookings Institution, Brookings Mountain West and SRI International. Film and media, the report noted, represent a leverage opportunity for diversification within the core industry of tourism in Southern Nevada. In addition, our proximity and connectivity to the film industry in Los Angeles, the added benefit of featuring Las Vegas tourism within movies, and cross marketing ties with our live entertainment and events economy are reasons to target this sector for growth and development.

If Louisiana can develop a program worthy of the moniker “Hollywood South,” think what the creative forces in Las Vegas can accomplish. California recently tripled its film tax credit program, offering more than $1.65 billion in incentives, done in the name of jobs and tourism.

The gross output of the U.S. film industry in 2012 — $120 billion — roughly matches the entire Nevada economy and exceeds such U.S. industries as automotive repair and maintenance ($112 billion) and natural gas distribution ($92 billion). The same report notes that since 2001, hiring trends in the industry outpace overall U.S. employment. As fewer films and television programs are produced in Southern California, states poised to compete in this market have a unique opportunity, and Nevada should aggressively be knocking at the door.

Unfortunately, the very state agency whose official strategy recommends promoting film and media in Southern Nevada swept away most of the state’s film tax credits to fund an incentive package for Tesla Motors’ planned lithium battery factory east of Reno. After raising legitimate objections that we should not rob from one targeted industry in the south to promote another up north, the Nevada Legislature voted unanimously for Tesla’s incentive package.

We hope the Governor’s Office of Economic Development and the Nevada Legislature will reinstate, and possibly increase, the film tax credit program in the 2015 legislative session.

It is disappointing to hear disparaging remarks about the quality of jobs in the film industry. Yes, we allocated film credit to “Paul Blart: Mall Cop 2.” To critics, we point out that the film is set at the Wynn Las Vegas and, like many other Las Vegas movies, promotes our tourist locations and provides direct production jobs. Also note that the first “Paul Blart: Mall Cop” film grossed almost $190 million — or an amount equivalent to Nevada’s tax credit package to Tesla.

Our point: The motion picture industry is serious business, what with the jobs, careers and economic activity it generates. And what of the charge that film jobs are “temporary”? Film is a flexible industry, where ad hoc teams assemble for each production — but many technical staffers remain more or less continuously employed because as one production ends, another begins. The point of the Nevada film tax credits was to build our workforce and media infrastructure to create an ongoing film production enterprise in our region. To that end, Southern Nevada higher education institutions are helping to produce this workforce.

Nevada previously offered green building tax credits for what some might label “temporary” jobs. As with film, construction jobs rely on a ratcheted-up local industry where one job ends and another follows. Southern Nevada’s success in green buildings, with CityCenter as the largest example, translated into a local expertise in green architecture that is now exported throughout the world.

Finally, and perhaps most importantly, the dramatic reduction and redirection of the Nevada film tax credits to support the Tesla Motors project sends a negative signal not only to the film industry but all firms looking to do business in Nevada. Consistent economic policy is of vital importance. When a state offers a tax credit, it invites companies to begin investing in an industry based on an expectation of that subsidy. To offer and withdraw subsidies in a haphazard, makeshift manner is bad for business — all business.

The film industry has a rational expectation that Nevada will follow through on its commitment and offer tax credits for a decade and then evaluate the program’s success. Now it may view Nevada as an erratic and irrational state that yanked away credits a mere nine months after first offering the incentive.

Furthermore, the fallout from dismissive remarks about the film industry by state officials may take years of effort to undo. They were heard by representatives from the Southern California movie industry, who were not amused.

Do not forget that nearly one-third of Southern Nevada tourists hail from Southern California. It is simply bad business to belittle our best customers and business partners.

Robert E. Lang is the UNLV director for Brookings Mountain West, executive director of the Lincy Institute, professor of public affairs in the Greenspun College of Urban Affairs, and a senior fellow of the Brookings Institution in Washington, D.C. William E. Brown Jr. is assistant director of Brookings Mountain West.