No Longer King Of The Hill, Top Of The Heap

New York State has seen a downturn in music production and the recording industry. As other music- and technology-savvy regions around the country line up economic incentives to draw jobs and talent to them, New York is watching the feasibility of working here drop due to rising costs and a dwindling musical workforce. Now a bi-partisan bill aims to establish the Empire State Music Production Tax Credit and turn the tide.
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Clive Young,

Editor-In-Chief, PSN

Pro Sound News is based in New York City and while our editorial team is spread out across the country to bring you the latest in pro audio news, there’s no getting around the fact that being in New York can give one a certain viewpoint if you’re not careful. There are some New Yorkers who swear this city is the center of the universe. Name the topic—business, arts, media, sports, whatever—and they’ll insist that the 8.4 million people who live in the Big Apple enjoy the best there is. Naturally, this irritates the other 314.3 million people in the United States who know better, because it’s not true at all—take politics, for instance: Both major presidential candidates call NYC home and odds are that you don’t like at least one of them (and possibly both).

But all kidding aside, there’s another area that New York City—and New York State, too—is not a leader in, and that’s music production. Once considered a go-to destination for recording, major studio after studio has closed in the Big Apple since the turn of the millennium. While some remain agile and prosperous, the mood has been particularly grim the last few months with the closures of Times Square’s Terminus Recording Studio in July, nearby MSR Studios in June, and downtown’s The Magic Shop in March, all while the venerable Avatar Studios on the west side has been up for sale since last Fall. With TheNew York Times estimating that the property is worth $27 million, Avatar’s days as a recording facility seem likely numbered.

NYC is just a fraction of the state as a whole, however, and the state has likewise seen a downturn in music production and the recording industry. As other music-and technology-savvy regions around the country line up economic incentives to draw jobs and talent to them, New York is watching the feasibility of working here drop due to rising costs and a dwindling musical workforce.

On the New York State Senate website, state assemblyman Joseph R. Lentol (D, Brooklyn) doesn’t mince words about the problem: “We used to take for granted that we were the epicenter of the music industry. We assumed everyone wanted to do business here. We were wrong. During the past decade, our state has witnessed a flight of recording studios, technicians, artists and songwriters to states across the country. From 1999 to 2014, New York’s share of top albums fell from 24 percent to about 12 percent and Local 802 AFM, the state’s union of professional musicians, reported a 30 percent drop in recording work. Unless we want New York’s music economy to continue its slide into mediocrity, we must take a stand.”

Now Lentol and state senator Martin Golden (R-C-I, Brooklyn) have sponsored a bi-partisan bill looking to establish the Empire State Music Production Tax Credit. Aiming to benefit all of the state and not just New York City, the bill would provide a 25 percent tax credit for eligible production costs for downstate music businesses and a 35 percent tax credit for them upstate—a formula akin to the state’s current film-industry tax breaks. Capped at $25 million per year, the program would be applicable to costs such as renting studios, instruments and related equipment; session fees for engineers, techs, musicians and others; mixing and mastering work; and other costs directly related to music production.

While there aren’t many vocal opponents to the bill, a story by Kelly Weill on politico.com last year observed that the state’s film industry netted 22 percent of the state’s business tax credits while accounting for less than one percent of its income, adding that many of those credits went to large corporations like Time Warner instead of smaller businesses. With that in mind, monitoring how the music production bill’s tax breaks would be apportioned—and their ultimate effectiveness—is a fair and reasonable concern if it were to be passed.

The bill passed the State Senate in mid-July, but as of this writing, there is no indication as to if or when Governor Cuomo will sign it into law.