By Jan Moller
You may have noticed that Duck Dynasty has been in the news recently, and not just because of the Robertson family’s usual shenanigans. Instead, the debate revolves around the generous subsidies that Louisiana taxpayers are providing for the producers and cast of the hit A&E reality series.
It appears to have started with an article on the Inquisitr website, quoting an “industry insider” who estimates
that the Duck Dynasty cast, which is paid $200,000 per week to appear on the popular reality show, receives government benefits of $70,000 for every episode of the A&E cable show from the state, even though Louisiana recently slashed funding for health care programs and pension programs for public employees such as police, teachers, and firefighters.
That was followed by coverage in the right-wing blogosphere, and finally a column in Sunday’s Baton Rouge Advocate by James Gill, who pointed out that that Robertson family patriarch, Phil, has been denounced as a hypocrite for criticizing welfare programs at the same time that his family benefits from state subsidies.
There are only two problems with this coverage: First, it neglects to mention that the state has yet to fork over a dime to the Duck Dynasty producers. That won’t happen until audits are finished. More importantly, it significantly understates the state’s financial exposure, which stands at $6.2 million and is poised to grow significantly.
First, some background on the film program: The state gives Hollywood tax credits that cover 30 cents of every dollar spent on film or TV productions in Louisiana. For actors (or “on-air talent” like the Robertson family) the deal is even better, as tax credits cover 35 percent of salaries. These tax credits are fully refundable, meaning recipients can redeem them even if they have no state tax liability. Since most production companies don’t owe Louisiana taxes, the tax credits work as a direct cash subsidy.
Check out LBP’s 2012 report for a detailed background on how the Hollywood tax credits work.
Although Duck Dynasty recently began its sixth season, producers have only submitted expense reports for the first three seasons. These fall into three categories: Total budget, Louisiana expenditures (the amount eligible for state subsidies), and “on-air talent,” which is part of the Louisiana expenditures and denotes what was paid to the Robertson family and their co-stars.
Table 1 Duck Dynasty Louisiana budget
|Season 1 (15 episodes)
|Season 2 (13 episodes)
|Season 3 (13 episodes)
The show’s Season 1 budget was fairly modest, and the Robertson clan – then largely unknown – was being paid well, but not extravagantly. It was, after all, a new show, and no one had any idea how audiences would respond.
But American viewers fell hard for the hirsute waterfowl enthusiasts. And the Robertson family was suddenly getting paid like the overnight sensations they had become. By Season 3, the cast was being paid nearly 15 times as much as in season one – more than $6 million for 11 episodes. And the taxpayers’ liability was skyrocketing as well.
This next table shows how much Louisiana taxpayers will cough up for the first three seasons of the show.
Table 2 Duck Dynasty subsidies
|Cost per episode
Add it all up and Louisiana will pay a little more than $6.2 million for the first 41 episodes of Duck Dynasty, and probably a good deal more once the producers submit their receipts for seasons four through six and beyond. After paying a mere $38,433 per episode when the show was finding an audience, state taxpayers are now kicking in $328,521 for each half-hour episode. That’s more than eight times the $39,823 median income in Ouachita Parish, where the Robertsons live.
We know from previous studies that every dollar the state spends on tax credits brings in around 15 cents in new tax revenue to the state, which means the more money the Robertsons earn, the less money the state has to spend on road repairs, college textbooks, health care and public safety.
And here we get to the big problem with Louisiana’s film program.
If a state decides that it wants to subsidize film and TV productions – as dozens of states are now doing – it makes some sense to incentivize risk-taking endeavors like the Duck Dynasty pilot. After all, for every hit show there are a dozen disasters like “The Governor’s Wife.” A generous film subsidy program makes it more likely that producers will continue to look in Louisiana for the next generation of reality stars, instead of, say, Alabama or Texas.
But it makes no sense, in a state that struggles to provide basic services to its citizens, for taxpayers to continue their open-ended financial support when a pilot becomes a worldwide sensation that generates $80 million a year in ad revenue and untold millions more in product licensing.
If anything, the state should be demanding a share of the profits, since its taxpayers shared in the financial risk that the producers took in creating the show.
And that brings us to a final point, made by Mr. Gill but which bears repeating. It’s easy to blame the Robertson family for this mess, and to vilify them for accepting state assistance while criticizing programs that help support poor families. But the Robertsons are only playing by the rules set by the state, which created the film program and continues to protect it despite the damage it has done to Louisiana’s budget.
Instead of steering tax subsidies to the Robertson family, a better choice for Louisiana policymakers would be to cap the film program so the dollars can be reinvested in communities that truly need the help.