California moves to hold onto Hollywood
Its new budget offers tax credits to halt the exodus of film and TV production from the state.
Gov. Arnold Schwarzenegger made his name in Hollywood as "The Terminator." Now, California's governor is playing another kind of terminator: one trying to stop film and television production from leaving the state.Skip to next paragraph
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Billions are at stake, and not just for the upper echelons of the film industry – the actors, directors, producers.
In the past few years, as the US has seen millions of jobs move offshore to other countries, California's multi-billion dollar film industry has been socked by major film production moving to states such as New Mexico, Louisiana, and Michigan as well as to Canada and Australia, all of which have offered tax incentives to lure film production. Losses from these moves have been estimated to reach about $10 billion per year.
The state's refusal to play the subsidy game changed last week when Mr. Schwarzenegger signed a budget bill that included $100 million a year in tax credits for the industry for so-called below-the-line spending, which are payments to crew members other than the main stars and filmmakers.
"I can't breathe from the number of producers, executives, directors, studios calling to say, 'I was planning a production in New York, Florida – wherever – and I want to keep the production here in California, how can I apply?'" says Amy Lemisch, executive director of the California Film Commission. "This is having a gigantic effect."
Film and TV production has been moving out of California for years, Ms. Lemisch says, because of targeted campaigns by other states and countries. The fourth quarter of 2008 saw the number of location shoots in Los Angeles drop to 1,051 days, the lowest since 1994 when monitoring agencies first started keeping count. By contrast, the highest number of location shoots in the city was in 1996 with 4,059 days in a single quarter.
There has been a 50 percent decline in in-state film production from 2003 to 2008, that can be tracked to a time when other states began their campaigns to attract film and TV production, says Lemisch.