Hollywood Tax Credit Keeps Jobs In State
By Beverly Lewis
Published: Sunday, December 19, 2010 - Midnight | Sacramento Bee Page 3E
Re: "You get red ink with that popcorn" (Forum, December 12)
Besides Mr. Morain’s errors about the Film and TV Tax Credit Program he ignores the point that this is a jobs program. Productions hire hundreds of workers and spends millions that support small businesses. In the first two years of the program, participating productions are estimated to bring $2 billion in direct spending to California, including $740 million in wages paid to “below-the-line” crew (electricians, drivers, etc.) - generating much needed California tax revenues.
Why a tax credit at all? In 2000 a 14 month study determined $10 billion exited the Hollywood film industry due to incentives elsewhere-when three states were offering them. Now 42 states have them. There were certainly some states which wrote poor legislation to begin with and are now revamping their programs. California’s new program targets those productions most likely to leave the state.
Ever watch the credits at the end of a film? Those names were mostly Californians; now they’re not because incentives elsewhere require you hire their residents in order to get their tax credits. By 2000 almost every American TV movie was shot in Canada. Since 1997, over 36,000 California film jobs disappeared as well as the significant dollars to our local communities from location production. New Mexico legislators aped Canada’s success and more by integrating their incentives with their university infrastructure. This includes technical post-production and computer jobs which can start at $65,000.
Productions in the California program are selected by lottery not content. While it’s easy to disparage provocative titles like “Walter the Farting Dog” (a noted children's book written by a National Magazine Award winner) - we all have favorite films, cars, or clothes we prefer to buy over others - this does not make a valid argument for ignoring a major industry at risk. Other productions qualifying for tax credits this year include one on Hemingway and for the Hallmark Channel. Because of the lottery, studios don’t influence selection process. As written 10%% of the funds must go to independent films; this year 39% of the selectees are independents.
As for efforts that resulted in this legislation, after nine years of educating Sacramento legislators to the impact of runaway production, stakeholders like union representatives, employers, and film commissioners representing communities all over the state can say this tax credit program was a long time coming, and it is a modest one at that.
Producers, like General Motors, will still make their product somewhere but if they shoot here the dollars stay here. It’s that simple.