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First Iowa film credit scandal trial opens today

February 07, 2011

Minnesota filmmaker Wendy Weiner Runge goes on trial today on charges of looting the Iowa film tax credit program. She's in for the fight of her life, as three of her partners have already worked out deals with the prosecutors and will presumably take the stand against her. The Des Moines Register reports:

One of those partners, Matthias Saunders, has already pleaded guilty to first-degree theft.Prosecutors allege he greatly inflated expenses for rental equipment used on the film, such as two brooms that cost $225, six road cones for another $1,350 and stepladders for $900 to $1,350.

Runge, executive producer of the film, also sought and won millions in tax credits for expenses provided "in-kind" - or at no cost - by Saunders' company, Maximus Productions.

But Runge has contended that those in-kind services - totaling $3.7 million - were approved by several people in state government, not just fired film chief Tom Wheeler.

I expect prosecutors to use the State Auditor's report on the scandal as their road map. Ms. Runge is likely to try to turn the tables by making the case about the state's shameful mismanagement of the program, also amply documented in the auditor's report.

The trial is being held at Drake University, which annually hosts a trial for the benefit of their law school students. It seems like an appropriate show-business setting for a show-business trial. Among those likely to follow the drama closely are two other filmmakers facing felony charges arising out of their use of the program, Bruce Heppner-Elgin and Dennis Brouse. A Quad Cities "film credit broker" also faces charges.

The "half-price filmmaking" program briefly made Iowa a favorite destination for Hollywood. Iowa's media watchdogs were bought off by celebrity sightings and hors d'oeuvres until the program collapsed when reports emerged of taxpayer dollars buying Mercedes cars and feather beds for producers and iPods for their relatives. So far, interestingly, no criminal charges have come out of the Benz and iPod purchases.

Related:

The Iowa 'let's pretend' film credit

Auditor report: millions of real taxpayer dollars paid for imaginary film expenses

Complete Tax Update film credit coverage

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