State Rep. Kent Smith (D-Euclid) today announced a proposal to promote music industry growth in Ohio. The proposed Ohio Sound Recording Investor Tax Credit, or "OhioSounds," would provide incentives for music production, studio construction and recording within the state. Smith submitted the proposal for consideration in the state budget.
“OhioSounds would solidify the state’s commitment to our musical legacy and help encourage further creative endeavors from Ohio musicians while driving economic growth in a competitive industry and making Ohio a destination for musicians and producers,” said Rep. Smith. “This will not only inspire the next generation of The Black Keys or Bootsy Collins, but will provide a substantial economic return for communities across the state.”
Current data lists music industry revenues at nearly $7 billion annually. Rep. Smith wants to see some of that investment come to Ohio.
Rep. Smith’s proposal would provide tax credits for 25 percent of the related sound recording production costs for music projects created in Ohio. It would also refund 25 percent of music studio construction and recording infrastructure costs. To qualify for OhioSounds, production costs must exceed $5,000 per project, with a maximum incentive set at $50,000. If OhioSounds becomes law, the total amount of initial incentives would be capped at $3 million.
“We have the ability to attract talent not only from Ohio, but across the globe to create music, pioneer new technologies and contribute to our local economies. It’s a win-win,” said Smith. “We have the opportunity for people to be exposed to and fall in love with more Ohio talent. I think its a solid gold opportunity— maybe even platinum.”
Smith’s proposal models a similar tax incentive program in Louisiana, which allows current residents to access credits for music production within the state without an upper cap limit. The Ohio program differs in that the credit is not limited to Ohio residents. However, with an upper limit of $50,000, Smith believes the credit is sustainable.
"Ohio’s history for musical talent and creativity has deep roots,” said Rep. Smith. “This proposal will help seed Buckeye creativity and spur innovation across the state. I am excited to announce this during Rock N Roll Hall of Fame Induction Week."
Rep. Smith says music industry growth could have a big impact in the Buckeye State and points to Richard Florida, an American urban studies theorist, who discusses the growth potential—technologically and economically—for the music industry in the coming years.
In his 2005 best seller The Rise of the Creative Class, Florida writes, “Music is now being recognized as a fruit-fly industry – as an early indicator of new technologies, new business models and the economy in general. Music is a highly competitive business – a hyper competitive market in miniature.”