Eager to revive Boston’s status as a regular testing ground for big-name Broadway musicals, legislators are proposing a tax credit for producers who bring shows to the state before heading to the Great White Way.
The credit would grant up to $3 million to a production that plays in Massachusetts before opening in New York or to a touring show that starts here, reimbursing up to 35 percent of its state labor costs. Advocates of the proposal say the credits would create hundreds of jobs and drive millions of dollars of business into Massachusetts.
But critics of the bill compare it to the state’s controversial film tax credit program, arguing that the costs are not worth the benefits. There is also some question about how much business would actually be spurred through credits, and there is no protection if a show dies before it gets to New York.
Josiah Spaulding Jr., president of the Citi Center for the Performing Arts, and Richard Jaffe, vice president of Broadway in Boston, have been pushing the tax credit proposal.
State representatives Nick Collins of Boston and Paul McMurtry of Dedham filed a theater tax credit bill on Jan. 17. The two Democrats say they want Boston once again to thrive as a tryout ground for Broadway productions.
In the past, such shows as “Annie Get Your Gun,” “Anything Goes,” and “Oklahoma!” first took the stage here. But Spaulding and Jaffe point out that in recent years — as Louisiana, Illinois, and Rhode Island have passed such tax credits — it has become harder to recruit those high-profile test runs for Massachusetts.
“It’s of great economic benefit to the state,” Jaffe said. “It’s also not reinventing the wheel. We just want to get it back going again.”
But Tom Viertel — a longtime New York producer whose shows have included the original Broadway productions of “The Producers,” “Hairspray,” and “Angels in America” — said that tax credits alone will not allay concerns about Boston’s market.
“The problem is that in order to do a good job with a pre-Broadway show, you have to be able to keep it in front of an audience for close to a month while you work on it,” Viertel said. “The daunting aspect, from a producer’s point of view, is, ‘Can Boston really provide a month’s worth of audiences?’ Even with the tax credits, Boston may be a little limited as to what it can attract.”
Through a spokeswoman, Mayor Thomas M. Menino of Boston declined to comment on the proposal.
The tax credit program has lured work to Louisiana, including a 2011 run of “The Addams Family” that opened its national tour at the Mahalia Jackson Theater in New Orleans, according to officials there.
“It’s absolutely driven business to the state,” said Chris Stelly, executive director of the Louisiana Office of Entertainment Industry Development. “It gives us an edge. It is intriguing for the live-performance world, and now they have a fiscal incentive to test it out.”
In Rhode Island, which passed a tax credit last year, programmers at the Providence Performing Arts Center say they are already seeing results.
J. Lynn Singleton, the center’s president and chief executive, said that he believes he was able to lure the Broadway musical “Elf” to begin its tour in Providence late last year largely because of the tax credit. He said he is currently in talks to open a series of national touring shows.
How much of a difference will the tax credit make?
“It’s all very early in the game,” Singleton said. “What I will do is take the shows we get in the fall and do an economic impact study. There’s no silver bullet, and there’s not just one thing you can do. But if you open a recent national tour in any city, it has an economic impact and a lot of cachet.”
In Massachusetts, it is unclear how much opposition Collins and McMurtry will face in the Legislature, where the bill is a long way from being debated. In upcoming months, it will be assigned to a House committee and scheduled for a public hearing, McMurtry said.
The state’s film tax credit, signed into law in 2007, has proved controversial. That credit offers to reimburse companies for up to a quarter of their spending in the state. It has led to a wave of major film projects in Massachusetts and to the state paying out more than $171 million in credits.
Critics have questioned whether the subsidies are worth the cost, mainly because the temporary jobs created are largely filled by out-of-state workers. The Department of Revenue has reported that the subsidy costs the state an average of $142,000 per job per year.
In addition, film companies have been able to sell their credits to corporations and wealthy individuals who want to lower their tax bills. The same would be true with the theater proposal, Jaffe said.
Deirdre Cummings, the legislative director for the Massachusetts Public Interest Research Group, does not want any new tax credits until there is a proper study done to determine the value of existing credits.
“There are some 200 various tax breaks, credits, and giveaways to businesses and individuals,” she said. “We ought not to be adding to those until we know about what’s on the books now. Maybe there are great ones we should invest more in and some that aren’t working as well.”
That’s a feeling echoed by state Senator James B. Eldridge, Democrat of Acton, who also opposes the film tax credit.
“I do love theater,” he said. “I just think right now we’re making difficult decisions about budget cuts, and in this kind of fiscal environment, the idea of any new tax credit is a challenge.”
Jaffe and Spaulding say they expected criticism based on the film credit and point to what they consider important differences in their proposal.
The film credit has typically gone to out-of-town producers who film in Massachusetts and then present their movies across the country. The theater credit would lead to productions in local theaters, meaning that ticket buyers would spend in Massachusetts. In addition, they said, hundreds of workers are hired whenever there is a pre-Broadway run in town.
“We’re not sending the money back to Hollywood,” Collins said. “They’re not watching it in a theater across the United States. This is tangible.”
Also, the bill would establish limits on how much could be credited per year. In addition to the $3 million cap on each production, there would be a $10 million overall ceiling.
The proposal comes as the Colonial Theatre, owned by Emerson College and operated by the Citi Performing Arts Center, is readying for the new musical “Tuck Everlasting,” which Broadway in Boston will present there this summer in a pre-Broadway run. Jaffe and Spaulding are using the show as a case study for economic impact. Unlike a normal touring production, which generally comes to town for a maximum of two to three weeks, a pre-Broadway show needs to be in the theater for 10 weeks, said Jaffe. That’s because there is technical work and preparation to be done to ready it for New York.
During the 10 weeks that “Tuck Everlasting” is here, the Colonial will hire 150 local union workers for the theater, as well as attracting ticket buyers who pay to park, go out for dinner, and stay in hotels, Jaffe said.
“We need this credit,” Spaulding said. “Illinois has one. Louisiana has one. And if we can’t get one, we won’t be able to attract pre-Broadway shows again. Producers want to come here. They think of the Colonial as a rabbit’s foot. But it’s becoming harder and harder to attract the business.”
While Spaulding is stressing the Colonial’s role, the bill would make any production eligible, as long as it went into a local theater with 500 or more seats. The nonprofit Huntington Theatre Company and the American Repertory Theater occasionally produce shows, such as the ART’s Broadway-bound “Pippin,” that go on to New York with the participation of commercial producers. Both companies operate venues that would qualify.
“And when you’re talking about nonmusical plays on Broadway, they’re still rare and enormously risky,” said Michael Maso, managing director of the Huntington. “Helping to offset that risk in the pursuit of new plays on Broadway is a great notion.”