‘House Of Cards’ Producers Playing Their Own Political Hardball Over Tax Credits

'House Of Cards' Producers Playing Their Own Political Hardball Over Tax Credits

If Maryland doesn't ante up millions of dollars, the Netflix hit will pack up and leave the state

It should come as no surprise that the company behind “House of Cards” is willing to play political hardball.

After two seasons of receiving prime tax breaks to shoot the Emmy-nominated, binge-watched Netflix series in Maryland — $11 million for season one, up to $15 million for season two — Media Rights Capital has informed the state government that should they not receive similar refunded compensation, they it could seek out greener pastures for season three.

Also read: David Letterman Doesn't Know If It's OK to Talk About ‘House of Cards’ Premiere Spoilers Either (Video)

“In the meantime I wanted you to be aware that we are required to look at other states in which to film on the off chance that the legislation does not pass, or does not cover the amount of tax credits for which we would qualify,”  Charlie Goldstein, MRC's vice president, wrote in a letter to the state's governor, Martin O'Malley. “I am sure you can understand that we would not be responsible financiers and a successful production company if we did not have viable options available.”

Also read: ‘House of Cards’ Review: How Do You Raise the Stakes From Murder? Like This

Most ominously, the letter states that, should the funding not go through, MRC would be forced to “break down our stage, sets and offices and set up in another state.”

In an effort to attract more production to the state, Maryland's legislature has authorized $40 million in tax incentives to TV and film crews over the last few years; qualifying movies can get 25% of their production costs refunded (with an obvious cap), while TV series can receive up to 27% back. The state's fund for production incentives is, as of now, reverting back from 2013's $25 million to a mere $7.5 million, which would certainly force “House of Cards” to relocate should MRC be serious about its threats. There are bills that would raise the 2014 spending to up to $18 million, according to The Washington Post.

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“We’re almost being held for ransom,” one Maryland lawmaker told the paper.

The company's pitch is that the show's production has brought 6,000 jobs and around $250 million in economic gains to the state in its two seasons. TV and film production has fled from Los Angeles in recent years, spurred by deep tax incentives offered by other states; there has become in some sense a race to the bottom to attract shows both new and old.

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As for potential alternate filming locations, the DC-set series has a number of options. While logistically, Virginia would be the closest move, the state offers little in terms of tax credits, with only $2.5 million available for a production. New York, which has become a major hub for production, with many new sound stages being built in Brooklyn, a tax credit of up to 30% of costs and a state kitty of $420 million to distribute. FX's “The Americans,” which is set in DC, actually shoots in New York.

Another option would be Louisiana; though it is not geographically similar to DC, it was the site of production on the White House thriller “Olympus Has Fallen” and offers 35% kickback. It is not, however, as convenient for the many media personalities that appear in the Netflix series.

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  • spitmasmith

    Sloppy article. If the Maryland state legislature makes the democratic choice to discontinue their incentive, it would have a significant negative impact on the businesses that chose to be in that state largely as a result of that incentive. There are other states that offer more competitive incentives (not kickbacks as the lazy writer refers to them) and of course the financing company will need to look at all options. This happens on every single film and tv show now. Please refer any of the hundreds of articles about how state tax incentives have lured production work out of its traditional home in LA. Same exact issue.

    Is this The Wrap or Entertainment Weekly?

  • It's a Terrible Show Anyway

    go shoot Baton Rouge for D.C. and see how that works out for you, jackholes