In late January, as part of his proposed state budget, Gov. Elliot Spitzer (D-N.Y.) called for an expansion of the Empire State Film Production Credit. Gov. Spitzer advocated an increase of the film/TV production tax credit from 10 percent to 15 percent of a project’s total spending in New York, plus backed broadening the scope of those production-related expenditures eligible for the incentive program.
The industry sector immediately rallied to support Spitzer’s initiative, among the vocal proponents being Alan Suna and Stuart Match Suna of Long Island City-headquartered Silvercup Studios, a New York stage facility mainstay.
“It’s about job retention and creation,” affirmed Silvercup CEO Alan Suna. “While the industry has rebounded for a period [in New York], it has hit a wall with increased competition from other states. The new incentives that the Governor is proposing are intended to mitigate some of this impact…We believe that this credit, combined with New York’s talent pool, locations, studio facilities and technical and support services, will encourage producers to continue to increase working in New York.”
Indeed the original Empire State Film Production Credit, passed in 2004, has had a profoundly positive effect on the New York economy in terms of increased feature film and TV program production.
“Following the Empire State tax credit program, New York City hosted more film and television production than ever before,” continued Suna. “This program, coupled with the city’s ‘Made in New York’ tax incentive, is the reason for the increased activity. New York City is back as a key player in the film and television business, with a growing number of productions that highlight the city’s competitiveness in the industry.”
Suna noted that just this past year alone, Silvercup was able to secure the TV productions Cashmere Mafia (ABC/Sony), Gossip Girl (CW/Warner Bros.), New Amsterdam (FOX) and the second season of Emmy Award-winning 30 Rock (NBC) as a result of the state and city incentives.
Furthermore a record high of 10 TV series pilots were shot in New York last year. Six of those pilots were picked up for the ’07-’08 primetime season, with three of them produced at Silvercup.
“Productions filmed at Silvercup Studios have created hundreds of new jobs for New Yorkers of all backgrounds,” said Stuart Match Suna. “New York State is helping to strengthen the industry and in so doing will benefit other businesses such as restaurants, retail shops and other services, making this a win-win for New York. These incentives will also give us the chance to better compete with studios in other states.”
Pat Swinney Kaufman, executive director of the New York State Governor’s Office For Motion Picture & TV Development, stated, “We are delighted that Governor Spitzer has taken the lead to increase New York State’s film and television production credit in response to the heightened competition that we have faced since Connecticut, Rhode Island and Massachusetts have introduced such aggressive programs. Since its inception in August 2004, New York’s program has attracted close to $3.5 billion in production to New York in feature films, episodic television and pilots. In order to meet the challenges of our neighbors’ programs, it is critical that the legislature support the Governor’s vision and pass the proposed increases to the incentive program as it now exists.”
Increased competition Indeed there has been increased competition from other states in terms of incentives designed to keep and attract production. Camille Geier, COO of rhinofx, noted that the visual effects studio has benefitted from the New York incentive program. In 2006, for example, rhinofx in New York garnered effects assignments on the movies Perfect Stranger and The Nanny Diaries.
And while it continues to encourage business in its New York hub, rhinofx has also taken notice of Connecticut’s aggressive incentives program, the centerpiece of which is a 30 percent credit on all above-the-line expenditures in the state, including directors’ fees, spanning projects ranging from commercials to features, TV and video games. This attractive incentives program prompted rhinofx to open a studio in Stamford, Conn., which is in the midst of its first major feature visual effects gig, for Ghost Town, a DreamWorks/Paramount project written and directed by David Koepp (who’s written such action blockbusters as Spider-Man, Lost World: Jurassic Park and Mission: Impossible). Creative director/director Arman Matin heads the rhinofx team on Ghost Town, a romantic comedy slated for an August 2008 release.
While Ghost Town is being shot in New York, with most of the post done in Gotham as well, the visual effects business came to Connecticut, said Geier, due to the combination of rhinofx talent and the economies offered by being able to tap into Connecticut’s incentives package.
“It’s a win-win for us,” said Geier. “The whole Tri-State area is growing thanks to incentives. We’ve been pursuing feature film visual effects for some time. It’s been part of our business plan prior to any state incentives–but the incentives have helped us to accelerate our plan and bring it to quicker fruition.
She added that the spot production house community hasn’t yet taken full notice of what’s happening in Connecticut and the economic leverage that can be gained by doing business there. Geier related for example that if a total CG spot were produced by rhinofx in Connecticut, the 30 percent tax credit would apply, translating into significant savings.
Spot handle Last year, New York State put an ambitious incentives program in place that specifically targeted commercials. The New York State initiative–funded to the annual tune of $7 million–offers refundable tax credits of five percent for qualified expenditures upstate (on production costs in excess of $200,000 during the course of a year) and downstate (on expenditures that exceed $500,000), as well as a growth credit provision in which the refundable tax credit is 20 percent of qualifying production costs on newly generated business (the amount of expenditure increase from one year as compared to the next).
The filing period to tap into these incentives on spots filmed in New York over the past year began on Jan. 1, ’08 and ends on April 1. At press time, applications to the New York Governor’s Office For Motion Picture & TV Development hadn’t started to come in yet. Thus, said Kaufman, “It is too soon for us to evaluate the impact of New York State’s commercial production credit.” She added that her office expects applications to start coming in closer to April 1.
Whatever the initial impact, the spot community is confident that the incentive program’s long-range effect will be a significant boon to commercial biz in the state–and to the state itself. As chronicled in SHOOT, the Association of Independent Commercial Producers (AICP) had a major hand in helping to make New York’s commercial incentives program a reality.
“There’s no doubt that the program will prove to be a tremendous asset,” assessed Carl Sturges, president of AICP/East and executive producer of Michael Schrom & Company, Long Island City. “It may be hard to determine the initial impact as we’re in the midst of a perfect storm of factors–the state of the economy, the tax incentives and the recently ended Writers Guild of America strike. But absolutely the incentives program will push things forward in New York. And as awareness throughout the production community increases about the tax credits, once it’s seen that there’s real money involved, you’ll see more and more companies looking to take advantage of what New York has to offer.”
