Film industry players say better film incentives needed to lure projects
By Scott E. Pacheco
If you think sunshine, sandy beaches and brilliant blue waters are enough to attract film projects in a tough economy, think again, film industry leaders say.
While Florida has cut its incentives by 80% for film projects, other states such as Michigan, New Mexico, Louisiana and Georgia are dangling lavish incentives.
"This is Florida; we should be booming right now, especially with what's happened in the last week" with the economy, said Robert Parente, director of the City of Miami's Mayor's Office of Film & Cultural Affairs.
"Without a competent incentive it's cost prohibitive" to film here, agreed Kevin Sharpley, chairman of the community building committee for the Miami-Dade County Film and Entertainment Advisory Board.
And with the state cutting funding for other creative industries — which include advertising, architecture, bioscience/life science, film, music, interior design and photography/visual arts — an incentive may be even more welcome.
The Creative Industries Committee of the Greater Miami Chamber of Commerce sent a proposal to the state around Oct. 3 requesting that the state increase funding for arts programming grants to $13.57 million from the $5.7 million that was allocated this year. This is down from about $11 million allocated in 2007-2008 and less than half the $14.226 million allocated in 2002-2003.
Six Miami-Dade projects are on the list to be funded, though none was this year. Those include about $2.5 million for the Adrienne Arsht Center for the Performing Arts.
"We are right now in a bad market nationally, not just here," said Stephen H. Siegel, chairman of the chamber's Creative Industries Committee. "But when the market turns around, those places that have been doing it are going to have a leg up."
But some say increased funding may not be feasible in the current economy, and that film incentives are the way to go. The film industry contributed $153 million to Miami-Dade's economy in 2007, a 20% increase from the year before, the county says.
"You've got to do something," said David Caserta, president of Miami-based David Caserta Government Relations, which represents the film, entertainment and digital media industries.
"You've got to look at the pie and say, "You know what, if we can just stimulate this side then maybe there will be enough economic impact'" to stimulate other parts of the economy.
Mr. Siegel agreed.
"I am one of those who believes that a viable, a strong film industry down here is a catalyst in a number of ways," he said. "It utilizes lots of creative industry talent so it creates other creative industries. Number two, it creates good-paying jobs to help bolster the middle class and upper middle class… and number three to me it helps bolster the whole idea of cultural tourism. It helps our tourist industry — there are people who go to California to visit the movie lots; to me it's one of the industries that I think is the future to expanding the base of the economy down here."
Currently, the State of Florida has only $5 million — based on what it spends in-state — to offer as incentives to film projects, Mr. Sharpley said. This is down 80% from the $25 million that was offered last year.
Compare that to one of the states hit hardest by the economic downturn because of its reliance on the plummeting auto industry — Michigan — which in April passed the Michigan Film Incentives bill that offers up to 42% in rebates on film money spent there.
The Detroit News reported that Michigan Film Office CEO Anthony Wenson said about 65 films, which will spend an estimated $440 million in the Great Lakes State, have been approved for the rebate. Thirteen of the films have finished shooting, eight are shooting now and the rest are still to come.
In the article, Mr. Wenson said "hotels, dry cleaners, restaurants, laundromats" all benefit from having film projects come in, as do chauffeurs, makeup artists and truckers. The article also talked about how big-name actors have come to and said positive things about Michigan, which helps the state's image.
And in New Mexico, a state 25% production cost rebate for the local film industry has attracted "more than $600 million in direct spending since 2003, and an estimated $1.8 billion in total financial impact, as of last June," according to the New York Times.
"The thing is it's paltry," Mr. Sharpley said of Florida's incentive package. Mr. Sharpley is president and CEO of Kijik Multimedia Inc., a Miami-based production company; and executive director of Cinevisun, which promotes local film.
He said that every dollar spent from the incentive produces a reciprocal benefit of $7e, which should be kept in mind when considering an incentive for Florida. He said he would like a 30% tax rebate passed that would permit film projects to sell the tax credits.
While not as enticing as Michigan's 42%, it doesn't have to be, he said.
"Thirty percent would at the very least make us competitive," he said. "We don't have to meet Michigan's incentive because we have more to offer.
"I know three films that were going to shoot here but they are looking toward Michigan now."
But there are negatives to offering tax breaks, opponents say, which could offset the positive impacts.
In Louisiana, the state is on the hook about $27 million in tax credits for actor Brad Pitt's "The Curious Case of Benjamin Button." Even in Michigan, though no numbers are available because films have not yet submitted their budgets, some are saying that the state's annual film spending could hit $200 million a year before long, according to the Times article.
Louisiana, which originally offered up to 15% credit for nearly the entire budget of a film, changed its rules to offer a bigger incentive but dictated that it was only on money spent in-state. And in Michigan, a state senate committee recently moved to cap film rebates at an aggregate of $50 million per year, according to the Times.
Mr. Caserta said Florida needs to strike the right balance, but needs to recognize how quickly Hollywood could infuse life into the economy.
"When you are the leader of the state you are looking to identify the industry that has the ability in these economic times to flourish — those are the opportunities you are looking for so you can use them as a spark," he said. "There are so many things about Florida that people truly want to come anyway; we've just got to make sure we have the right balance."
Mr. Siegel said there is a line where too much incentive to the film industry could be negative. However, he doesn't feel Miami and Florida are there.
"There is a point, but I don't think we are anywhere close to that."