Minzner

Readers are either making lemons or lemonade over the state's new film incentives that helped attract NBCUniversal to the city this week. The company inked a 10 year deal that will see it open a film and TV studio here and pledge an investment of up to $500 million and provide over 300 good-paying jobs.

First the lemonade view from a government insider in Santa Fe:

The critics of the film incentives always frame the rebates as coming out of the state's bottom line. But the rebates are coming out of what those production companies spend here. If you spent $10 at my lemonade stand (that's a lot of lemonade but I guess you're thirsty) and I gave you $3 back as part of my special Local Monahan Lemonade Incentive, I've got $7 in my pocket I wouldn't have had otherwise. So the genuine question is this: Where is the disconnect that folks still don't want that net positive, they call it a "bribe," etc? It doesn't definitionally appear to be a partisan thing. Now, yes, you can get into trouble when you cap what you can give back, sending rebates you owe into future years, i.e., the Gov. Martinez model. And that's why we have a nice fat Martinez backlog. But that would suggest the problem is the cap, not the program itself. What am I missing?

Of course, there's never any shortage of readers around here to tell you what you're doing right or wrong  So here's ABQ attorney Dick Minzner, a former state rep and onetime head of the NM taxation and revenue department, to make lemons out of that reader's lemonade:

 Joe, The subsidy is paid by the state from tax receipts. It is not paid from the total dollars spent in the state. (These dollars are in the hands of individual employees and vendors.) It is true that the amount of the subsidy is computed with reference to the total dollars spent in the state (25% or 30% of total spending), but the payment is by the state from tax receipts.

Your lemonade stand selling me $10 of lemonade would pay state and local gross receipts tax of about 8%, or 80 cents. After the state receives its share of this amount (about 55 cents), it would then pay a rebate which is based on the total amount spent, $10.00. The amount of the rebate would be $3.00, paid from state funds, even though the state received only 55 cents.

Note that this transaction is not only extremely generous to the recipient of the rebate, far exceeding any taxes he paid. It also provides a “free ride” to local governments, which receive a piece of the gross receipts tax collected, but are not responsible for paying any of the rebate.

Thanks, fellas, but after all that we're going to forget about opening our lemonade stand this summer.

RADIO SHAKING 

Frisch

Pat Frisch, the longtime program director of conservative radio talker 770 KKOB-AM, is out. Frisch ended a 20 year run at the 50,000 watt station this week, with insiders saying his controversial 1 to 3 p.m. talk show played a part as his conservative commentary grew more personal and biting which management did look kindly upon.

Frisch steered the legacy station, owned by Cumulus Media, to the #1 position in the ABQ market from 2000-2014. With the changing media landscape the station has since drifted downward.

Frisch had a zeal for taking on Democrats like Bill Richardson and more recently Gov. Lujan Grisham. He says he will take some time off and then look for a new radio post. The station is advertising for a replacement.

Speaking of KKOB-AM and KKOB 94.5 FM, we will be on the air there today at 5 p.m. with radio veteran T. J. Trout to kick the political football around. Trout was added to the station's line-up earlier this year as management bet that a more moderate approach might bring in new listeners to the afternoon time slot.

See you on the radio and back here tomorrow for some Friday blogging.

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(c)NM POLITICS WITH JOE MONAHAN 2019