(The Center Square) — Louisiana lawmakers took a look this week on how to bolster the state’s music industry and keep that revenue in the state.
The subcommittee on the study of the state’s music industry was created in May 2024 to look at how music effects economic growth in Louisiana.
Reid Wick, the Grammy organization’s membership and industry relations representative for the Gulf Coast, gave a presentation on Monday on why the Legislature should invest in a music infrastructure.
Wick said the music industry contributes $1.4 billion to the Pelican State’s gross domestic product, and creates over 30,000 jobs. However, it could be a lot more.
Louisiana’s unique culture is known for two things: Music and food. Wick rattled off name after name of Grammy award winners from Louisiana and described the musical talent as the state’s “number one natural resource.”
This is evident by the state being number one in the live music scene with things like festivals and clubs. With that said, most of the state’s GDP is from these live events. Live music is great, but Wick says the real money lies in publishing businesses and talent agencies.
In fact, the industry norm is that artist bring home 10%-16% of every dollar earned. The rest goes to behind the scenes jobs like business management, booking agencies, venues, promoters, recording studios, production crew, tour support, and more.
The problem is, local artists have to leave state for professional services that can advance their careers. Places like Austin, Nashville, and New York have been profiting off of Louisiana artists for decades.
“This is a huge issue that’s been plaguing the state for many years, is that we’ve seen that money that’s earned by our artists leave the state,” Wick said.
Along with pure dollar signs, musically talented young adults graduating with hopes of working in the music industry have to leave for jobs in the behind the scenes fields described above.
“We’ve seen this brain drain related to the music industry for a long time as well,” Wick said.
Louisiana in recent past years have given incentives for recording studios and talent agencies to do business here.
For example, the Louisiana Sound Recording Production Program provides a QMC payroll tax credit on annual W2 wages for approved music industry companies.
A 10% credit is given for each new job whose QMC payroll is equal to or greater than $35,000 per year, up to $66,000. A 15% credit is given for each new job whose QMC payroll is equal to or greater than $66,000 per year, but no greater than $200,000.
Another helpful tool is the Sound Recording Investor Tax Credit, which provides an 18% tax credit for sound recording projects made in the State of Louisiana.
This program is subject to a cap of $2.16 million per year. Each project is subject to a $100,000 cap, per year.
With the tax reform session that started in November and a budget deficit expected in the coming years, Wick and other music industry professionals wanted to meet wit the subcommittee to make sure these programs don’t go away.
Along with keeping the current programs, Wick also said the music scene needs more investment to improve infrastructure, and most importantly, more advertisement.
The tax credit program mentioned earlier has never hit its cap, or even come close. Wick believes this is because not enough people know about it. With how good Louisiana is at advertising its food, he thinks if it dedicates that same type of energy towards music it will bring more business in.
