New Yorkers — and residents of many other states — have paid more for entertainment in recent years than just their Netflix or Hulu subscriptions.
Each New York household has also contributed about $16 in taxes, on average, toward producing the drama series “Billions” since 2017. Over that period, each household has also paid roughly $14.50 in production incentives for “Saturday Night Live” and $4.60 for “The Irishman,” among many other shows and movies.
Add it all up, and New York has spent more than $5.5 billion in incentives since 2017, the earliest year for which data is readily available. Now, as a new state budget agreement nears, Gov. Kathy Hochul has said she wants to add $100 million in credits for independent productions that would bring total film subsidies to $800 million a year, almost double the amount from 2022.
Other states also pay out tens or hundreds of millions each year in a bidding war for Hollywood productions, under the theory that these tax credits spur the economy. One question for voters and lawmakers is whether a state recoups more than its investment in these movies and shows — or gets back only pennies on the dollar.
New York has one of the largest tax credit programs and makes most of its data public, so we totaled its spending to see which productions benefited the most.
Television shows that film multiple seasons in New York have received the most money over time, though movies filmed in the state also receive credits:
The basic premise of the incentive program is that for every dollar of qualified spending by a production, whether for a camera operator or costumes, New York will reimburse 30 cents. (It won’t reimburse for some types of spending, like big salaries for movie stars.)
Supporters say jobs are created when productions choose to film in New York. The state also makes at least some of the money back, both directly (crew members pay taxes) and indirectly (more money spent on craft services means local catering companies grow and pay more taxes). Calculating just how much money is returned relies on a series of assumptions.
A recent study commissioned by Empire State Development, the agency that administers the tax credit, found that for every dollar handed out, about $1.70 was returned via local or state taxes, meaning the program was profitable for the state.
But many economists say these programs are money losers. A separate study commissioned by the New York State Department of Taxation and Finance estimated a return of only 31 cents on the dollar.
States are in a race that can be hard to quit
Two New York state senators in the Democratic majority, Michael Gianaris and James Skoufis, agree that states are in an escalating competition to attract productions. They disagree if that game is one New York should try to win.
“There is a race that is taking place among the states and that is why we have to adjust it,” said Mr. Gianaris, the deputy majority leader, citing a desire to keep up with increases from New Jersey. “It’s constantly a re-evaluation based on what other jurisdictions are doing and whether we need to adjust our program to maintain our success.”
Mr. Skoufis wants out: “It’s a race to the bottom. The loser is the taxpayer.”
Either way, the race between neighbors is heating up. In recent years, New Jersey has expanded its program to $800 million a year, up from $100 million in 2021. Some productions have benefited from both states: “Severance” received tax credits for its first season from New Jersey ($1.1 million) and New York ($39.6 million).
In 2010, New Jersey provided a natural experiment of what happens when a state leaves the race, when Gov. Chris Christie suspended the state’s program. He cited budgetary concerns and frustration that “Jersey Shore” — approved for a tax credit — depicted the state negatively. New Jersey’s film industry shrank quickly, though not entirely.
A recent survey of incentive programs by The New York Times estimated that states had paid out more than $25 billion over 20 years. Last year, Gov. Gavin Newsom of California cited the size of New York’s subsidies when he proposed increasing his state’s tax credits to $750 million from $330 million.
New York’s development agency treats all applicants equally. Its program’s administrators make no judgment as to whether a credit is needed to bring a production to New York. “Saturday Night Live” and a new CBS procedural would both be eligible for the same tax credits, even if the latter has far more flexibility to pick its location.
Productions might boost tourism … for some states
Mr. Gianaris, whose district is in Queens, says estimates of the New York program’s value don’t account for tourism. New York has a “massive tourism economy built around the fact that New York is a character” in TV and movies, he said. “There’s unmeasurable impact of that, which is why I think the credit is more than just the balance sheet.”
To qualify for the program, films or shows are not required to have their fictional worlds based in New York. “Pretty Little Liars,” for instance, received a $30 million credit in 2024 even though the story is set in Pennsylvania.
But many shows that film in the state do make New York a central part of their programs. Of the 10 productions that have received the most tax credits since 2017, eight are primarily set in New York.
The same isn’t true for every state. In New Jersey, productions receiving tens of millions of dollars in tax breaks often set their stories in New York.
Within a state, the benefits are unequal
Even as states compete for productions, their incentive programs often pit different parts of a state against one another.
Mr. Skoufis, who represents part of the Hudson Valley, north of New York City, said there are “some entrenched interests that benefit from the program — unions and other stakeholders.” He added, “My colleagues love soundstages in their district.”
Although the program offers an additional 10 percent reimbursement to productions in upstate New York, a majority of productions are in New York City. In 2024, just 15 percent of tax credits went to productions filmed outside the city.
New York City gets a lot of the tax dollars in return: One study, also commissioned by Empire State Development, found that the city receives almost half the additional tax dollars generated by the film incentives, though it is the state that pays the incentives.
Lawmakers who represent areas where the film industry has thrived have a reason to keep the money flowing, even if it doesn’t all flow back to state coffers.
Justin Marlowe, director of the University of Chicago’s Center for Municipal Finance, said lawmakers often make decisions on tax incentives without detailed information. As a result, they often do so with an eye toward preventing a bad political outcome.
“As a public finance person, I look at this and say this is really not good for taxpayers that we play this silly zero sum game,” Professor Marlowe said. “And you can’t blame state legislators for playing it because they have to, right? If they don’t, they suffer political consequences.”
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