Lee Rood's Article In Des Moines Register Today

Wheeler: Agency denied help for program
He said he knew he needed more resources, but was turned down.

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LEE ROOD

Iowa’s former film chief quickly realized he needed help running the new film program passed by legislators in 2007, but a state agency head told him he wasn’t getting any, he testified Monday.

Tom Wheeler — facing charges of felony misconduct, first-degree fraudulent practicies and first-degree conspiracy — took the witness stand in his own defense.

His testimony signals that the trial of the only state official charged in the film tax-credit scandal is nearing an end. The prosecution is expected to cross-examine Wheeler today, and the three-week trial could go to a jury later this week.

Wheeler, who was hired at the Iowa Department of Economic Development in 2004 and fired after abuses of the program were discovered in 2009, said everything about his job changed after a new tax-credit program for filmmaking took effect in the summer of 2007.

Thanks to the incentive program, filmmaking in Iowa skyrocketed from 2007 through 2009. The film industry brought $82 million in new economic activity to the metro area during that time period, according to earlier testimony in the case.

But Wheeler testified Monday that not only were there no rules and no template for how the unique program should work, no one at Iowa’s Department of Economic Development had any experience with film incentive programs.

“There were tremendous problems from beginning to end,” Wheeler told the jury.

Wheeler testified that former Department of Economic Development Chief Mike Tramontina flatly refused to provide the new program extra resources when he came and asked for help in the fall of 2007.

“I said, ‘I think this program is going to pick up some speed. I’m already up to my shoulders,’ ” Wheeler said. “… He said, ‘You’re not getting any help.’ ”

Tramontina testified last week that he could not recall the specifics of conversations he had with Wheeler.

Prosecutors are trying to prove that Wheeler not only mismanaged the film office, but that he intended to aid others in defrauding the state.

A state audit has shown that $26 million of nearly $32 million in tax credits were awarded improperly by the film office, either because the productions did not qualify for the credits or because documentation was incomplete.

Wheeler testified that Tramontina seemed to think his job was still primarily marketing the state to filmmakers after the tax-credit program began. All state agencies were undergoing budget cuts at the time, and “the department was at its limit,” Wheeler said.

But Wheeler said the one-man film office quickly fell behind. He was building new forms for contracts and applications, fielding calls from more filmmakers and accumulating so much data on projects, it overwhelmed the Department of Economic Development’s server.

Wheeler said he had to buy an external hard drive at his own expense because he was told the department had no money to spend on new equipment.

Wheeler said he began to run the program through trial and error, eventually coming up with a system for tracking every contact with filmmakers and every film.

His computer files, which he examined Monday with defense attorney Angela Campbell for the jury, suggested he was far more organized and open than auditors and prosecutors have suggested.

For example, Wheeler maintained a massive spreadsheet, which he said he presented regularly to his bosses. The spreadsheet showed more than 30 details about each project that came across his desk.

Among other things, he kept detailed information of when contracts changed, where they were in the awards process, estimated tax-credit awards, start and finish dates, and budgets.

Campbell and Wheeler reviewed the information because prosecutors alleged Wheeler helped filmmakers dramatically inflate the budget of the movie “The Scientist,” a film by Polynation Pictures, without his supervisors knowing.

“So it is not accurate to say you weren’t telling them about the increases in the budgets?” Campbell asked.

“Not accurate at all,” Wheeler said.

Wheeler said he did everything from gofer work on animated films to landscaping to film processing at Walgreens before he was hired at the Iowa Film Office in 2004.

He said he had no training in contracts, drafting administrative rules, accounting or the law.