Theater Tax Credit Left Out Of Mass. Economic Development Package

Aug 18, 2014

The Hanover Theatre in Worcester, Mass.

Massachusetts Governor Deval Patrick recently signed an economic development bill that included a slew of initiatives aimed at promoting growth in various sectors. But the Democrat, a noted arts supporter, vetoed a tax credit aimed at bringing pre-Broadway theater to the commonwealth’s stages.

The vetoed tax credit proposal was aimed at recouping profits from a business Massachusetts hasn’t seen in quite some time. Troy Siebels is president and CEO of The Hanover Theatre in Worcester.

“It would have helped Massachusetts theaters like us compete with other theatres in neighboring states to launch either pre-Broadway shows, shows that used to play Boston before they would go to New York [City] or and this is more likely what would have affect us as the Hanover in Worcester, touring shows before they leave on national tour,” explained Sibeles.

If enacted, theater companies would have been reimbursed for 25 percent of the total production and performance expenses of a show. Democratic Representative Nick Collins of Boston sponsored the legislation that made it through both the House and Senate, before stopping at the governor’s desk. He says the idea was to help Massachusetts theaters better compete with other states that had passed similar laws to those in Illinois, Louisiana and in upstate New York.

“I believe Massachusetts should not play second fiddle to any other state and also the real job creation opportunities that were there and to strengthen our creative economy,” said Collins.

One stipulation of the tax credit was that it only applied to theaters with at least 600 seats, excluding smaller venues like the Williamstown Theatre Festival. Collins says the reason for the limit was to insure significant job growth for backstage work on large productions.

“It’s not something that I would have been against expanding beyond the borders of 600-seat capacity, but I think in order to make the case that this was going to be a significant job creator and one that we could actually measure, that is where the threshold become,” said Collins.

Greg Bialecki is the state’s secretary for economic development.

“The theater production tax credit I think even as supporters would admit was going to support really a handful of productions and a handful of theaters,” Bialecki said. “So for example the R&D tax credit expansion which the governor did sign by contrast is available to companies doing research and development in any industry.”

While it’s unknown how the tax credit would have impacted the Berkshire Theater Group’s Colonial Theatre in Pittsfield and The Mahaiwe in Great Barrington, both of which hold more than 600 people, those living near Worcester’s Hanover Theatre with 2,300 seats could have seen more job opportunities, according to Siebels.

“Whereas the cast for a show likely don’t come from Massachusetts, some might, but they can come from anywhere and probably largely New York, the crew though is almost entirely going to be locals of the area that launches the show so that would have been Massachusetts crew,” Siebels said. “Lighting, sound, rigging, costume and props people. The same people that benefit occasionally by the Massachusetts film tax credit. This would have done the same thing for theater.”

Siebels says a Broadway production at The Hanover Theater requires a crew of 30 to 60 people.

“Now for The Hanover Theatre in Worcester those folks are only on contract for three to five days or a little longer depending on how show runs,” Siebels said. “But obviously if a Broadway show is opening you talk about those people being on contract for a month or more.”

Julia Dixon is the director of Berkshire Creative. She says the proposal is a missed opportunity for the area.

“We’re not Boston so these kinds of programs even if they do bring in temporary workers from New York can benefit the area so much,” said Dixon.

Representative Collins says he was surprised Governor Patrick vetoed the legislation. He says he’s heard disappointment from labor organizers representing those who work off-stage.

“We’re not going to dwell on it too long, but we’re go back to the drawing board and see how we can get this thing in place,” said Collins.

The Hanover’s Siebels is hopeful as well.

“I hope that the effort comes back in the next session because I do think it’s a worthwhile thing,” said Siebels.

The Massachusetts Cultural Council did not take a formal position on the proposal. Spokesman Greg Liakos noted Governor Patrick’s track record in supporting the arts.

“We think the most effective way to benefit the nonprofit theaters in Massachusetts is to increase funding for general operating support and to maintain the capital funds through the Cultural Facilities Fund,” said Liakos.