Film official admits meddling with bill

By Robert Nott: The New Mexican

A doctored version of an official Legislative Finance Committee
document introduced in a House Committee session last week may cause
more confusion and controversy about the merit of the state’s popular
film incentive program.

Jon Hendry, business agent of the local film technicians union, the
International Alliance of Theatrical Stage Employees 480, introduced an
amended fiscal-impact report to legislators at a Business and Industry
Committee session on HB725 – introduced by Dennis Kintigh, R-Roswell,
to repeal the incentive program – on March 3. Reports are prepared by
the LFC to estimate the economic effect of legislation.

Hendry’s “corrected” fiscal-impact report, printed on LFC
letterhead, included different figures for estimated revenue than those
included in the original report and about 100 extra lines of analysis,
editorial and commentary. Much of the new text – which was highlighted
in red – suggested that passage of the bill would lead to economic
decline and ruin for many in the state.

Hendry said Thursday that the confusion arose when his four-page
cover letter to LFC director David Abbey and LFC economist Norton
Francis was not copied along with the report. Hendry said that document
made it clear that his revised report was not the real thing, but just
Hendry’s analysis of it all.

“I apologize,” Hendry said. “I put comments into the report – no
apologies for the way I did that – but I do apologize that if you take
it away from the cover memo it was stapled to and photocopy it, it can
look like a real report.”

Rep. Thomas C. Taylor, R-Farmington, said he became aware of the
situation after noticing that some committee members had copies of
Hendry’s report with the highlighted red text, while other members
received black-and-white photocopies.

“We have had a problem with some people deciding to put their own
political editorial within the report, and this is a blatant abuse of
that,” Thomas said. “I can’t believe that somebody who has been around
the legislative process awhile would think about using a form that,
across the top, has the LFC disclaimer.”

Taylor, who said Hendry apologized after the hearing, brought the
issue up at a House session later that week, warning his colleagues to
be aware of such incidences.

Abbey confirmed Thursday that the amended fiscal-impact report was
not an official LFC document. “Corrected isn’t the word we used,
revised is the word,” he said. While fiddling with an report in such a
manner isn’t illegal, Abbey said he considered it “an unfortunate, bad
practice.”

Eric Witt, Gov. Bill Richardson’s point man on film and media
matters, said he accepted Hendry’s explanation: “It was an honest
mistake, but clearly misguided,” Witt said. “They shouldn’t have
created the document to begin with, even for internal purposes. There
are ways to critique a report that don’t entail making it look like it
came from the LFC.”

The incident reinforces the determination that film industry
supporters display when it comes to proving that the business is
benefiting the state. This issue has heated up in the past few months,
fueled in part by two reports on the economic impact of New Mexico’s
film incentives.

A study released in August by the Arrowhead Center, the economic arm
of New Mexico State University in Las Cruces, said that the rebate was
netting state government 14.5 cents for every dollar the state spends
on the program. The Legislative Finance Committee commissioned that
study after lawmakers suggested that the tax rebate wasn’t working.

In January, the New Mexico State Film Office and State Investment
Council released a study by the accounting firm of Ernst & Young
that stated state and local government revenues amounted to $1.50 for
every dollar.

During the house hearing, Kintigh produced a third study by the LFC
that compared the first two studies and suggested the Ernst & Young
study overestimated the fiscal benefits of the program. Kintigh also
cited recent reports from California and Louisiana suggesting that the
film business may cost more than its worth.

In his cover letter to Abbey and Francis, which could be construed
as a study responding to the study about the first two studies, Hendry
acknowledged that “everyone is caught in a repetitive cycle where each
is refuting the other’s survey.”

HB725 has been tabled. The studies are probably still being studied.

Robert Nott can be reached at 986-3021 or rnott@sfnewmexican.com.