Photographs of a film production studio Pacifica Ventures operates in Albuquerque, N.M., were part of its presentation yesterday at the State House.

The Providence Journal / Steve Szydlowski

PROVIDENCE — With legislative leaders cheering him on, a California developer yesterday unveiled plans to build a major movie studio in Hopkinton that could help make Rhode Island the Hollywood of the East if — and only if — lawmakers here provide new tax incentives.

Los Angeles-based Pacifica Ventures says it will create a sprawling $75-million motion picture facility on 60 acres off Route 95, complete with eight sound stages that would cement the state’s status as a viable player in the film industry.

House Speaker William J. Murphy called the proposed studio “an economic engine for the state … the second half, the job producer that goes along with the film and television tax incentive” that lawmakers adopted in 2005.

Rhode Island Film & Television Office Director Steven Feinberg said the project would create 500 construction jobs followed by 2,200 long-term production-related jobs, giving the growing industry the home it needs to make the smallest state a permanent fixture on the big screen.

Pacifica Ventures is no stranger to the movie business. The company opened a similar studio in Albuquerque, N.M.

Neither is it a stranger to controversy.

The developer is currently embroiled in a California fraud lawsuit alleging that it misspent more than $1 million while managing another Hollywood studio.

Company chief executive Hal Katersky was previously involved in a New Orleans start-up company that failed to generate promised employment and defaulted on a multimillion-dollar lease, according to media reports.

Katersky disputed those allegations yesterday, saying the California lawsuit was without merit and the New Orleans failure was a byproduct of the Hurricane Katrina fallout.

A native Rhode Islander and 1964 graduate of the University of Rhode Island, Katersky said skeptics of the Hopkinton studio need only look at the company’s complex in Albuquerque — which opened a year ago as the only major studio of its kind outside of New York or Los Angeles and has been booked solid in the months since.

Pacifica Ventures is set to open a second studio in Philadelphia this summer.

In Albuquerque, Pacifica relied on the backing of union pension funds to finance the project; the state also kicked in a variety of tax-incentive deals. Katersky said he has not yet secured money for the Hopkinton project, but plans to launch the studio here hinge on forthcoming legislation creating the Rhode Island Motion Picture Studio Tax Credit, modeled on the state’s 2005 Motion Picture Production Tax Credit.

The way studio credits would work, the developer would get a 20-percent tax credit on construction costs associated with building the facility. So if it costs $75 million to build, Rhode Island will grant Pacifica Ventures $15 million in tax credits. It can then sell those credits at a discount to individuals who can use them to reduce their Rhode Island personal income taxes.

The company gets help funding its project; individuals get tax breaks and Rhode Island theoretically gets the millions of dollars and jobs that movie productions bring. But the state loses potential income-tax revenue.

If studio legislation passes the General Assembly this session, Katersky said, he would expect to open within a year. Issuing the tax credits at that point could add to the already huge projected deficit.

The governor’s office questions if that is too high a price to pay in a tight budget year.

While Governor Carcieri has seen no specifics, spokesman Jeff Neal said: “It does appear at first blush that this proposal could leave a multimillion-dollar hole in the state budget next year.

“In addition, a film studio in Rhode Island would be able to access the existing [25-percent] film tax credit for productions it produces. That could add up to tens of millions of dollars per year in lost tax revenue. As a result, this proposal will need some very careful and thorough analysis to make sure that the cost to Rhode Island taxpayers doesn’t outweigh the benefits of having movies filmed in Rhode Island.”

Clutching “Rhode Island Studio” baseball caps, legislative leaders yesterday maintained that movie industry tax credits are worth it. “This is an exciting project with the potential of being a major economic boon for our state,” said Senate President Joseph Montalbano, D-North Providence.

Since 2005, the state has issued a total of $30.8 million in tax credits, and has promised an anticipated $21.3 million more, according to the state’s Film & Television Office.

Less clear is how much money and how many jobs the industry has brought to the state.

The Film & Television Office has refused to provide details, despite a Providence Journal public records request filed more than a year ago. The Office at first declined to supply the information, but later, in negotiations between lawyers, reached an agreement where it was to provide some information last summer. It has not yet done so.

Recognizing that that film proposal will not be without its skeptics, Murphy said yesterday that he would be “more than willing” to require that the Film & Television office make public more information about the industry’s impact on Rhode Island’s economy, so long as it doesn’t violate proprietary studio information.

“If we need to make the process more transparent, I absolutely don’t have a problem with that,” Murphy said.

Supporters say building a movie studio could also help the Ocean State outpace Connecticut and Massachusetts which followed Rhode Island’s lead and created their own film incentives in recent years.

Director Michael Corrente, a Providence native, said it takes more than tax credits to lure movie producers. The movie business is essentially a mobile industry that can pick up and go anywhere that has the resources. Rhode Island’s small size and diverse landscapes make it a director’s dream. You can shoot a scene in Providence in the morning and follow it with a beach scene in the afternoon, he said.

But without a movie studio to anchor the industry, production companies must make due with retrofitted buildings and piecemeal sets that make Rhode Island a less-attractive place to make movies.

The time has come for the film industry to get a permanent home here, Feinberg said.

“Studios are good businesses, they’re clean businesses,” Katersky added. “They come, they spend and then they leave.”

With reports from Katherine Gregg and Steve Peoples of the Journal State House Bureau

cneedham@projo.com