The box office smash The Avengers has officially made more than $1 billion worldwide, after setting the record for largest opening in film history. This revenue dwarfs the film’s $220 million budget, and makes one wonder why the state of New Mexico felt the need to subsidize the movie to the tune of $22 million:
Marvel’s The Avengers has already raked in $1 billion worldwide, but News 13 has learned the state shelled out some serious cash to shoot the movie in New Mexico.
According to the Taxation and Revenue Department, the state paid $22,413,469 in credits to Marvel Worldwide, Inc., the company that produced The Avengers.
“This was spent on a movie production project that is now gone. It was here temporarily,” said New Mexico state Rep. Dennis Kintigh (R). “We could have spent that $22 million on all kinds of things like education for our children, we could have spent it on roads.”
New Mexico is far from the only state that provides film and television subsidies, but as the Center on Budget and Policy Priorities found, they are wasteful and ineffective, subsidizing activity that would have happened anyway:
State film subsidies are a wasteful, ineffective, and unfair instrument of economic development. While they appear to be a “quick fix” that provides jobs and business to state residents with only a short lag, in reality they benefit mostly non-residents, especially well-paid non-resident film and TV professionals. Some residents benefit from these subsidies, but most end up paying for them in the form of fewer services — such as education, healthcare, and police and fire protection — or higher taxes elsewhere. The benefits to the few are highly visible; the costs to the majority are hidden because they are spread so widely and detached from the subsidies.
43 states currently subsidize film and television production, to the tune of $1.5 billion in fiscal year 2010. Meanwhile, “the revenue generated by economic activity induced by film subsidies falls far short of the subsidies’ direct costs to the state.”