The entertainment industry was shocked when state legislators slashed $63 million from the Texas Moving Image Industry Incentives Program from the state’s budget. It’s a program that was created in 2008 to attract businesses by giving companies grants for hiring Texas workers to develop film, tv, commercial or video game projects in the state. Now the film and video game industries are trying to figure out what went wrong.



“I think it’s a cautionary tale when one side refused to negotiate in good faith,” says Bill Hammond of the Texas Association of Business.

Since 2008, the Texas Moving Image Industry Incentive Program has given entertainment companies about $150 million in grants for hiring Texas workers. But in the last couple of years, there was trouble brewing: The film industry didn’t want to be grouped in with video games in the state budget. They argued the two industries are just too different.

Barbara Morgan, the executive director of the Austin Film Festival, agrees the two industries are pretty different.

“Places that are creating those games, it’s not as overt as when someone is here shooting [a film] in the middle of the street,” she says. “But with gaming it’s different — those are usually done inside office buildings and created in a small environment.”

But separating the incentives program would have meant that the video game industry would have had to fight for money on their own.

“I thought it was a pointless exercise, one of those situations where we should try to get the pie and then figure out how to divide it up, rather than try to divide nothing,” says Jennifer Bullard, who directs an annual Austin-based video game conference.

In politics, we’re used to hearing about the eleventh-hour backroom deal — but not in this case. Neither side could agree, and Hammond thinks it was their very public battle that made them lose support in the legislature.

“At that point there was a lack of support in the legislature, and that combined with some criticisms with incentives across the board form the so-called Tea Party legislators, the support tragically evaporated,” he says.

The two-year budget deal reached by legislative negotiators includes $32 million for the incentive program. That’s about a third of the program’s current funding — less than half of what the governor asked for.

One thing both sides can agree on is that these cuts will be devastating to both industries.

Morgan says you won’t see big series like “American Crime” shooting in Texas anymore.

“As long as Louisiana and New Mexico and Georgia keep pouring money into the film industry, it will hurt us if we don’t have budgets that can compete,” she says.

Bullard says this is a step backward for one of the fastest-growing industries in the state.

“Everyone is disappointed, quite frankly, very upset and discouraged,” Bullard says. “This was an incentive program that showed that Texas cared about game development, and this just sends a really clear message that they don’t care about game developers.”

So for now, video games and the film industry will have to make do with a much-diminished incentive program.

An Mp3 version of this story.