Save the La. live performance tax credits

By Christopher Tidmore
Contributing Columnist

Due to expire in 2025, the Louisiana Live Performance Tax Credits constitute almost a quarter of the operating revenue of the New Orleans Opera, the LPO and several other local artistic institutions.

In the aftermath of Hurricane Katrina, one of the few serendipities was a cavalcade of new economic development ideas. Few came to fruition, but one, co-originated by Roger Wilson and the author, and passed through the Legislature through the tireless efforts of Bill Hines and the late David Voelker. It extended the movie tax credits to live, legitimate theatre. The idea was to create a live performance nexus in New Orleans and throughout the state in theater and live music, featuring our homegrown talent. Since the tax credit only began with productions of over $100,000 in revenue, it sought to create a large performance market where one effectively barely existed, and 50 percent of the credits were reserved for nonprofits, so that most of the money stayed at home – a protection that never existed in the creation of the film credits.

By midsummer 2025, these live performance credits are scheduled to expire, and without a major legislative initiative to renew them, the financial damage to storied institutions like the New Orleans Opera and the Louisiana Philharmonic could be catastrophic.

These tax credits are designed to encourage large productions that hire a lot of people, especially “below the line” personnel such as carpenters, electricians, set designers and others involved in building major staged performances. These are well-paid skilled laborers, mostly in union jobs. In total cost, the program amounts to only $10 million, a proverbial drop in the bucket of the $35 billion state budget, and each maximum tax credit is limited to $1 million maximum per production, so that one entity cannot claim it all.

The benefits to nonprofit performing arts organizations have been critical in their continued survival.

The live performance credits constitute, for example, almost 25 percent of the revenue of the New Orleans Opera – and they are constructed to support Louisiana jobs and Louisiana-built productions. For certified Louisiana expenditures, the state offers a seven-percent tax credit between $100,000 and $300,000. The credit jumps to 14 percent between $300,000 and $1,000,000 and to 18 percent for certified Louisiana expenditures over $1,000,000. Not-for-profit organizations are issued credits in the form of a “refund of overpayment” by the Louisiana Department of Revenue.

More importantly, the credits support local jobs. An additional seven-percent tax credit goes to payroll expenditures for Louisiana residents, with even greater incentives for the hiring of students at schools and universities. The public’s (often mistaken) impression is that performing arts institutions only employ singers, actors, or musicians, yet these incentives have allowed the opera’s H. Lloyd Hawkins Scenic Studio to hire more than a half dozen young people each year and train them in skills that vary from electrical repair to carpentry to technical skills. The tax credit supports a permanent set building staff of 20, who pack up and reconstruct sets for theatrical productions in 35 states and three Canadian provinces each year. The 30,000-square-foot building includes a design studio that has full carpentry and metal shops, a spacious 80’ x 80’ paint deck, a stocked prop loft and a fully equipped sewing room for costumes.

Louisiana always hoped to be exporting content with film tax credits, but we export made-to-order sets and are paid to reconstruct them on stages in other states, thanks to the live performance credits. The profits underwrite the Hawkins studio to construct the theatrical sets for schools, like George Washington Carver, effectively at cost, and the tax credits – in general – allow institutions like the Opera to invite hundreds of school children to watch operas for free as part of the “Schools Night Out” program.

Other arts institutions like the LPO and the ballet use the credits to help fund educational outreach, at least in part. Revenue from the tax credits also funds master classes with university students and famous opera singers, as last occurred in Gallier Hall in October with the famed Raehann Bryce Davis and students from Xavier, Dillard, Southeastern, Loyola and Tulane.

Large artistic organizations already lost a key funding resource when Governor Landry‘s 2024 tax reforms repealed the “quality jobs” tax credit. That constituted almost 20 percent of the opera’s operating budget, for example, with a similar impact on the budgets of other large artistic institutions. Some political insiders view the performance credits as a painless method to cut the budget, not realizing the hundreds of jobs which are at stake. Plus, the credits have proven very effective in the for-profit theatrical sector as well. Since the tax credit is refundable or transferable on a one-time basis, productions from “Cirque du Soleil” to Broadway Road shows like the “Addams Family” were able to rehearse and stage their productions first here, hiring many Pelican State performers and production personnel.

However, unlike the film tax credits which were saved through a massive and well funded lobbying effort underwritten by Hollywood, there is no large cache of cash to save them. The live performance credits’ continued existence is dependent on legislators hearing from the general public – and being asked to keep them in place.

New Orleans staged the first opera in what is now the United States in 1796. As the city celebrates the 230th anniversary of that achievement, it’s critical that our leaders in Baton Rouge know that the continued existence of these live performances depends on their taking action.

This article originally published in the January 13, 2025 print edition of The Louisiana Weekly newspaper.

Tags:  live performance, live performance tax credits, tax credit