Column - Master Thespians

Our state lawmakers are doing some award-worthy acting in the wake of the film tax credit fiasco.

They were blindsided. They were tricked. Tax credits for luxury cars? Round up the usual suspects. Call in the Legislative Oversight Committee.

But not everyone is shocked, shocked.

“It just didn't look like a sound program to me,” said Sen. Herman Quirmbach, D-Ames, who was one of three state lawmakers who voted against creation of the film credits back in 2007. House File 892 passed the House 95-1 and the Senate 48-2. Sen. David Hartsuch, R-Bettendorf, and Rep. Bruce Hunter, D-Des Moines, also voted no.

“It seemed to be a very poorly designed program,” said Quirmbach, who believes making taxpayers silent 50-50 partners in film projects is a bad idea. Quirmbach did vote for a bill this year that capped the credits, a reasonable step that apparently came too late to head off the excesses uncovered last week.

Clearly, lawmakers are not directly to blame for the blatant rule-breaking and breathtaking lack of bureaucratic oversight that turned a popular program into an embarrassment.

But they also shouldn't pretend they're innocent victims.

One common theme in this week's legislative dodge-fest is that the Department of Economic Development pushed through rules governing the program on an “emergency” fast track in July 2007. Lawmakers insist that left them no chance to review the rules before they took effect, including allowing credits for the purchase of aircraft, vehicles, furnishings, hairstyling and makeup.

There's one small problem with that argument: Much of what was in those rules was also spelled out in the bill they approved by overwhelming bipartisan majorities. The cars, the planes, the hair. All there.

You also have to wonder why lawmakers approved a tax credit program with the authority to hand out tens of millions of dollars but provided only enough money for a one-person office to administer it. A recipe for trouble.

And last spring, when legislators prudently decided to cap dollars flowing from the program, why did they delay screwing on that cap until July 1? In the meantime, a flood of credit applications exploded the program's potential cost.

Still, lawmakers can make things right.

They can start by digging into dozens of tax credits, for everything from historic preservation to livestock production, that are expected to cost $497 million by 2013. What are we getting for all that money?

This time, act responsibly, not surprised.

(Below is a report issued last month by the Iowa Department of Revenue on state tax credit programs)

Todd Dorman's column appears Tuesday, Thursday and Sunday. Contact him at (319) 398-8452 or todd.dorman@gazcomm.com

DOR Tax Credits Contingent Liabilities Report 8-14-09 (3)