City Council hears support for soundstage funding

Las Cruces Bulletin

The Las Cruces City Council heard widespread support for the construction of a soundstage at its Monday, July 27, 2015 work session.

Building the city’s first commercial soundstage is one of the projects being considered by the city council as a way to create economic development opportunities in Las Cruces. The city has earmarked a portion of the three-eighths percent hold harmless gross receipts tax (HHGRT) put in place July 2014 that will result from revenue bonds that will be issued later this summer, said City Manager Robert Garza. The amount of HHGRT funds allocated to economic development initiatives will total $12 to $13 million this fiscal year, said Garza and City Economic Development Coordinator Gary Camarano.

‘Provide an income stream’

HHGRT are funds the city is now collecting as the result of raising the gross receipts tax (GRT) last summer by 0.375 percent from 7.5625 percent to a new 7.9375 percent, Garza said. Doña Ana County has since raised the GRT by another 0.375 or three-eighths percent, taking the new tax rate to the current 8.3125 percent, he said. These increases were allowed to be implemented due to a new law enacted by the New Mexico Legislature in 2013.

The city had previously relied on guaranteed hold harmless distributions made available by the state to offset revenue lost by the city since 2004, when the Legislature exempted food and some medical services from GRT collection.

The state will repeal the hold-harmless provision over 15 years, beginning this year which, for the city, equates to a loss of more than $600,000 this year, increasing by additional $600,000 increments over the next 15 years until the amount of annual losses equals more than $8 million, Garza said.

“The current challenge for the city council is to use the excess GRT available today to undertake projects that will either reduce future costs to the city or provide an income stream to help offset the losses expected,” he said.

‘All viable, all have merit’

Camarano said the city’s Economic Development Committee has met twice to “discuss and evaluate proposals and recommendations” of economic development projects. In addition to the soundstage, Camarano said other proposals being considered include a combination soundstage and spec building (essentially a building shell constructed without a specific tenant in mind, but which could be quickly modified to meet a tenant’s needs); expansion of the Las Cruces Convention Center; hangars at the Las Cruces Airport; increasing the city’s ability to retain, expand, attract and create new business, either through economic gardening or through the state’s Local Economic Development Act (LEDA) closing fund; increasing the city’s ability to assist in expanding second-stage companies; providing a city business incubator and work space; and creating a city loan and small business grant program to assist with things such as website development, job training and infrastructure.

Garza said the purpose of spending HHGRT funds is “to create jobs and broaden our tax base.” The proposals being considered, he said, are “all viable, all have merit.”

In addition to city council members, more a dozen members of the audience spoke in favor of spending HHGRT funds to build a soundstage.

‘A dynamic opportunity’

State Rep. Jeff Steinborn, D-Doña Ana, who is chairman of the Regional Film Development Advisory Committee, said film-making is a “dynamic, robust industry” in New Mexico, and building a soundstage would be “such a dynamic opportunity” for Las Cruces. He said the film industry has generated $1.5 billion in spending and about 15,000 jobs in the state in the last five years. Steinborn, City Councillor Gil Sorg, Las Cruces Home Builders Association (LCHBA) President Max Bower, Project Mainstreet Las Cruces Chairman Russ Smith and others recently visited Albuquerque and Santa Fe to tour soundstages.

Bower said filmmakers who would come to Las Cruces to use a soundstage will need support that they won’t be able to bring with them.

“They will have to get it from our local vendors,” he said. “We as an industry are behind this effort.”

LCHBA CEO Steve Chavira said he also supports a soundstage in Las Cruces. As reflected in its mission statement, one of LCHBA’s roles is to be “a strong leader in economic development,” he said. Building a soundstage in Las Cruces would “create jobs and make ancillary services stronger.” Local set builders, developers and designers could work in Las Cruces instead of “chasing projects” in northern New Mexico and other states.

Las Cruces writer Dan Williams said Las Cruces has lost two movies this year alone because it didn’t have the infrastructure to support local production.

Russ Smith, chairman of Project Mainstreet Las Cruces, said Project Mainstreet supports the soundstage proposal. He also read a letter of support for the soundstage proposal from Las Cruces Tony-winning playwright Mark Medoff, a New Mexico State University presidential scholar who teaches part-time at NMSU’s Creative Media Institute for Film and Digital Arts (CMI).

‘Share the risk, share the reward’

Steve Newby of Las Cruces Community Partners, LLC, said it was important for the city to take risks for economic development – “share the risk, share the reward,” he said. A soundstage could provide local opportunities for a host of technologies and be an important source of revitalization.

Carrie Hamblen, executive director of the Green Chamber of Las Cruces, said a soundstage in Las Cruces would represent “a very great possibility” for local businesses. Restaurants and other businesses could benefit from spending by film crews in town to make movies, and the film industry would be a great addition to local economic development and tourism. I’m really glad we’re having this conversation,” she said.

Las Cruces actor and film maker Mark Vasconcellos said there are no large soundstages operating in the Southwest between San Antonio, Texas, and Los Angeles. “We have a huge, huge opportunity to corner a billion-dollar industry that is already in our state,” he said.

Doña Ana County Commissioner Wayne Hancock said he supports the soundstage proposal. He said the city and county should work together, “so that whatever is done is done for all the residents of the county.”

‘An opportunity to explore film’

Las Cruces actor David Edwards, who has appeared in 25 to 30 movies, television pilots and web series, said after the meeting, “While I am excited about the possibility of attracting films to the area – and they don't need to be blockbusters to satisfy me, small, independent films would be great also – I am most excited about the educational possibilities. To give students of all ages an opportunity to explore film as an artistic medium as well as all those cross-curricular opportunities and applications would be such an extraordinary training ground, and help keep those trained students around to actually have paid work in their field.

“Of course, I selfishly would like have movies come here so that I might be in them or help make them but all the clean economic benefits would be nice too. The major impact would not be so much jobs – there would be some, but I believe film companies bring many of their own people, but that could change as our pool of trained professionals grows – but in the retail and service industries. Film crews buy a lot of stuff and they need places to stay and food to eat.

“We, as a community, are going to have to learn to be more film friendly, however. If a large soundstage were to be built here perhaps eventually we would come to understand that.”

Edwards, a fixture in local theatre who spent a year-and-a-half pursuing an acting career in Los Angeles, will be teaching Intro to Creative Media and the Business of Filmmaking at CMI this fall, along with Perspectives of Film at Doña Ana Community College.

Councilor Olga Pedroza said the film industry is comprised of big names “above the line” and “hundreds and hundreds of people “below the line.”

“That’s what we need to keep in mind,” she said, referring to the jobs a soundstage could provide in Las Cruces. “This is an idea whose time has come.”

“I think we’re headed in the right direction on this project,” said Councillor Miguel Silva.

The Economic Development Committee will make a presentation to the city council with more specific proposals at the council’s August 24 work session.