Can a state buy its way into the film industry, or are these subsidies chasing an illusion of Hollywood that no longer exists?

Michael Brown has been involved with Nevada policy since 1995, and he began studying film subsidies specifically when the issue emerged as a significant economic development proposal in the state.

The former head of the Nevada’s Office of Economic Development and current fellow at University of Nevada’s Lincy Institute describes how the Nevada’s debate over film subsidies escalated from a small arts-support program into a proposal large enough to raise significant questions about Nevada’s tax structure on The Overton Window Podcast.

Brown traces the origins of the effort to 2021, when the state was emerging from the pandemic, and federal rescue funding created a surge of economic development ideas. Two film studios, working with the Howard Hughes Corporation, advanced an ambitious vision for a major production complex. Nevada already had a modest film-credit program, but the new proposal asked lawmakers to consider commitments on a far larger scale. By early 2025, the idea returned for a special legislative session after previous attempts failed to win support.

From the beginning, Brown approached the issue with skepticism. His concern was grounded in what he observed across the country. States that build large incentive programs often hope for permanent creative industries, but the most skilled jobs tend to come in with the production teams rather than develop locally.

“Film production is a stack of gigs; one job after another. And because of the footloose nature, it does not produce jobs. And the jobs in the runaway states that go to the locals tend to be catering security. It's not the creative arts high end jobs.”

Nevada’s tax structure makes this kind of program unusually risky. “I was concerned about the fiscal impact of transferable tax credits in a state without an income tax. Even the states where they insisted on building studios, like Louisiana or New Mexico, it hadn't produced results.” Without a broad tax base, Nevada bears the revenue loss directly, while the economic benefits remain uncertain.

Part of the political appeal of film incentives comes from public fascination with Hollywood. Brown cautions that this perception has little to do with how financing works today. “Everyone expects to be able to go in a restaurant and see some movie star sitting there. When really, this is just creating a pool of capital that film financiers can use to finance movies.” The result, he suggests, is a program designed more around celebrity culture than sustainable growth.

The job claims attached to the Nevada proposal illustrated the gap between promise and reality. Supporters floated employment figures that far exceeded the staffing levels of existing major studios.

“Sony has 9,100 employees. They were saying this was going to have 19,000 people working at the studio or 17,000 people. That doesn't add up.” Brown says. “And I kept asking also, if this was going to create so many jobs for Nevadans, why did the project include two large hotels? Who was going to stay there?”

The numbers were not aligned with how the industry actually functions. Nevada’s legislators reached the same judgment when members on both the left and the right rejected the plan. Their decision reflected more than a single policy dispute. It showed a growing awareness that the state must guard its limited tax base while preparing for what Brown describes as the coming “restructuring of the federal-state funding relationship.”

When the most recent proposal came to vote, it stirred both division and unexpected unity. “Progressives on the left and the conservatives on the right united on this issue and kind of like a horseshoe,” he says. “They needed 11 votes to prevail, and they could only get to 10.”

The narrow vote leaves Nevada lawmakers with the question: How can Nevada pursue economic development in ways that deliver real, measurable impact without overstretching a limited tax base?

Listen to the complete conversation on The Overton Window Podcast.

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