In 2004, the State of New York passed landmark tax credit legislation designed to encourage filming in the Empire State–and indeed it has done just that in terms of theatrical features and TV programs. For example, ’05 was New York City’s busiest production year in more than a decade–location shoot days increased 35 percent over the prior year. The overall tally of 31,570 days covers TV and film shoots on location and doesn’t account for soundstage work. Furthermore Gotham attracted an estimated $600 million worth of movies and TV programs–and more than 6,000 additional jobs in ’05 as compared to ’04.
The 10 percent state tax credit incentive and an accompanying five percent city tax rebate are generally considered the prime catalysts for the lensing surge in New York. However conspicuous by their absence are commercials, which don’t qualify for the incentives package.
The exclusion of spots is ironic in that New York, home to Madison Avenue, is synonymous with the advertising industry–and commercials have been a Big Apple business mainstay. Now, as reported in this week’s front page story, momentum is building to correct what some would charitably describe as an oversight.
The state legislature is considering an incentives package specifically targeting spots. Word is that the measure is included in the Senate’s state budget draft for the coming fiscal year. Now the commercialmaking industry is hoping the Assembly will do the same and that the budget that ultimately gets sent to Gov. George Pataki contains the anti-runaway production provisions–and that Pataki will approve it.
The Association of Independent Commercial Producers (AICP) has worked behind the scenes, meeting with legislators in Albany to get the spot incentives initiative to this point. The AICP effort dates back to ’04 in response to the disappointment of commercials not being part of the aforementioned legislation that has since proven so effective in attracting movies and TV fare. In Dec. ’04, the AICP hired a major lobbying firm, Wilson, Elser, Moscowitz, Edelman & Dicker, which helped to open some doors in Albany, enabling the AICP to present its case to legislators regarding the importance of commercialmaking to the New York economy.
Bipartisan support has been drummed up in both the New York Assembly and Senate, to the point where there is now a real chance to have the spots-only incentives program become a reality.
Indeed, there’s a pressing need for the reform. According to recent testimony delivered by AICP president/CEO Matt Miller to legislators in Albany, a leading industry payroll company has found that New York’s share of overall nationwide payroll in the commercial industry has plummeted from nearly 45 percent in ’90 to around 18 percent in ’04. In today’s dollars, this equates to a decrease of $406 million in below-the-line payroll expenditures for the State of New York from its level in ’90. That translates into a loss of almost $1.4 billion in direct economic impact from spot production in the New York region.
Miller added that competition for filming business has intensified, with other states enacting legislation designed to grow their share of production dollars. Much of this legislation, unlike that currently in effect in New York, includes commercials.
