The allure of Hollywood is almost irresistible. Everyone wants to see a movie star up close. Everyone dreams that they might someday be in the movies, if only as an extra. When the movies come to town, it somehow validates your community as a special place.

The movies have come to Massachusetts in a big way. It seems that every week there is another story in the news about the success of the film production tax credits enacted by the Legislature in 2007. Hundreds of good high-paying jobs! Hollywood East! There is now serious talk about building one, or more movie studios here.

What the fawning press fails to mention is the cost. Movie producers are eligible for a 25 percent tax credit. Don't confuse this with a tax break. Movie people don't pay any sales tax - that's one of the minor perks of doing business here. A tax credit is like an IOU from the taxpayers - a direct subsidy. For every dollar Disney or Fox spends, they get an IOU for 25 cents. When they spend $20 million on a big-name star, you shell out $5 million. That actor doesn't spend his money here; he takes it home to California. While he is here, the studios put him up in a fancy hotel and the taxpayers pick up 25 percent of that tab too. The same deal applies to TV shows and commercials shot here.

Massachusetts is now considering another generous benefit to the Film Industry. House Bill 4784 (formerly 4444) would have taxpayers pick up 20 percent of the costs of building movie studios. The danger here is not so much the construction costs, which would amount to hundreds of millions of dollars, but the ongoing costs. Once movie studios are built, we will be committed to funding 25 percent of their operating costs, forever.

Fox and Disney have no interest in building studios. Their only commitment is to tax credits, wherever they can be found - whether in Massachusetts, or any of the 29 other states that offer them. Proposals to build movie studios are coming from third-party investors. They will build them only so long as taxpayers are willing pay their customers to come. In order to better gauge the costs, I asked the Massachusetts Department of Revenue to provide an estimate of the tax revenue we might earn from the resulting economic activity, including spin-off job growth. They estimate that we will earn less than 18 cents for each tax credit dollar we spend. In other words, for every $100 million we issue in tax credits, our loss is $82.1 million.

Just as outrageous is where the money is going. Much of it, 29 percent in fact, is going to subsidize the million dollar plus salaries of wealthy movie stars and directors. This is not a business we should be in.

According to the DOR, a $100 million subsidy will generate, directly and indirectly, between 2,388 and 3,658 jobs. Based on a net revenue loss of $82.1 million, each job will cost taxpayers between $22,443 and $34,380. This represents, not the cost to acquire these jobs, but the cost to maintain them for just one year. Once film tax credits are ended or substantially reduced, film production will shift to other states offering more generous benefits and the job gains will evaporate.

Much of the film work lured to Massachusetts has come at the expense of New York, which has a well-established film industry, including movie studios. In April, New York struck back boosting their credits to 35 percent.

According to the Massachusetts DOR, tax credit commitments for just the first two months of this year are expected to be about $90 million. Throw a studio complex or two into the mix and the costs will be many times higher.

Once studios are built it will be impossible to sunset the production tax credits, which are currently scheduled to end in 2013. Like New York, we will be forced to defend our studios with ever-escalating subsidies. We are on the verge of committing ourselves to a permanent and growing entitlement that we simply can't afford.

Copies of the DOR reports are available at www.sdamico.com

STEVEN D'AMICO represents the 4th Bristol District, which includes the towns of Norton, Rehoboth, Seekonk and Swansea. He sits on the Joint Committee on Revenue.