BATON ROUGE -- Archie Manning, Drew Brees and coach Sean Payton are among more than two dozen people with ties to the Saints who together put nearly $2 million into an Elmwood film studio that has failed to return their investments as promised.Louisiana's film industry is financed through a program which grants tax credits to studios and production companies who then sell them at a slight discount to wealthy investors (professional athletes being one example) for cash. The investors can then apply the credit to their state income tax liability and end up coming in between 30 and 40 percent ahead on the deal. In this case, state tax dollars would reimburse Saints players for fronting the money to make movies. This taxpayer financed system of wealthy individuals shifting money back and forth is the lifeblood of Louisiana's "Hollywood South" film industry. Facing competition from other states, the Legislature extended and increased the credit in the recently concluded session. And while he isn't too keen on crucial mental health services for New Orleans residents, the governor is unlikely to veto this appropriation.
In addition to attracting film production to the area, the tax-incentive program has also caught the attention of the FBI on occasion. Late last year, attorney and LIFT Productions CEO Malcolm Petal pleaded guilty to bribery charges stemming from a scheme to acquire more value in tax credits than he intended to spend on film production.
Bribery is one way to game this system. Another would be fraud.
Manning and an attorney for one of the players said Wednesday that they thought they were taking part in a routine tax credit program offered through Louisiana's motion picture studio incentives until they discovered that the studio project never received state authorization for the credits and that their money was at risk.Read (another attorney-turned-movie mogul, by the way) intends to repay the Saints players, not with tax credits, but with money acquired from "new financiers." Not that Read is actually running a Madoff-like ponzi scheme but we'll easily forgive these Saints players if they continue to squirm over these next "two weeks." In Read's defense, since he hasn't obtained any tax credits, we can reasonably assume that he hasn't tried to bribe anybody.
"They weren't approved -- there was no reason to think they would not be, " Manning said.
Manning said he had received a telephone call from an FBI agent seeking information about the studio's investment plan.
Wayne Read, chief executive of Louisiana Film Studios, said that he was not aware of any federal investigation and that the Saints investors would get their money back as new financiers are brought into the project, which he said could happen in two weeks.
On the other hand, I know these guys are pro-athletes and all but man this is... not smart.
(Recently released deep snapper Kevin) Houser and the other Saints members made their investments in late 2008 and were due to receive their tax credits by the end of March, according to a tax credit contract and Houser's attorney, Rob Couhig.Is this true? Did Saints players and coaches (Sean Payton was an investor) simply drop their five and six figure sums in a hat (helmet?) that Houser and Couhig passed around the locker room? Did they even tell them what it was for? Maybe they just told them they were getting into show-biz. We already know that Payton has been trying to sell a screenplay. Was this his way of getting his beak wet in the industry?
The studio has yet to obtain the credits, Read said. Studio officials are talking to potential long-term investors for the project, and an announcement could be made in two weeks, he said. The money from the new backers would be used to return, at a minimum, the original amounts paid by the Saints investors, Read said.
Read said that although he received money from many of the Saints members, he had contact only with Houser. In some cases, players invested money without signing agreements, Read said.
No comments:
Post a Comment