The recently announced broadcast network schedules for the upcoming fall season have proven to be especially entertaining for Texas, which will be host to the production of three series: The Chase on NBC and Lonestar on ABC are slated to film in Dallas while My Generation, also on ABC, is set in Austin and expected to shoot there. Meanwhile the current summer show The Good Guys on Fox is being lensed in Dallas. Plus there’s the upcoming fifth and final season of Texas football-driven series Friday Night Lights.
It’s estimated that each TV series episode shot in Texas yields some $1 million for the economy.
Among the prime factors drawing the business to Texas are series storyline in the case of some of the shows, but looming large overall are the state’s production infrastructure and crews, as well as its incentives package.
Last year the Texas legislature approved an increase in funding for state filming incentives from a two-year total of $22 million to $62 million. Since that passage and Gov. Rick Perry signing the initiative into law in April 2009, more than 200 projects have gravitated to the state, generating an estimated 28,500 full-time jobs and in-state spending of more than $184 million.
Prompting the beefing up of incentives in ’09 were Texas-sized losses of some 7,000 crew positions and $500 million in production spending to states with at the time more competitive film incentives, such as New Mexico and Louisiana. At that juncture, it was estimated that about 25 percent of Texas-based film professionals were working in those other states, with some starting to relocate permanently. When Gov. Perry signed the bill for greater funding, he said that increasing Lone Star State filming incentives to a more competitive level represented “an important step in helping Texas regain its footing in the moving image business. With this legislation, we are strengthening our state’s investment in a vital industry that not only shows off our state to the rest of the world, but also draws investment and creates jobs for Texans.”
That has indeed proven to be true as evidenced by the aforementioned production tally and the further new business coming into Texas from upcoming fall network shows. Gov. Perry related during a recent press conference, “As the program continues to pick up speed and productions begin popping up all over the state, we’re hearing stories of a reverse migration of sorts as skilled production hands return to Texas. They are part of a growing critical mass that will continue to drive Texas forward and establish our state as the preferred location for film production, game design, commercials and television productions.”
Commercials too are included in the Texas incentives package with qualifying projects receiving a payment equal to five percent of eligible Texas spending. In order to receive the five percent, spending on a commercial or campaign must reach an in-state minimum of $100,000–and at least 60 percent of shooting days must be completed in Texas, and at least 70 percent of the total number of paid crew, cast and extras combined have to be Texas residents. Furthermore, projects that complete at least 25 percent of their total shoot days in an under-utilized or economically distressed areas of Texas may receive an additional 2.5 percent of in-state spending, for a total incentive payment of 7.5 percent of eligible Texas expenditures.
On the feature front, the Coen Brothers are shooting True Grit near Austin. The film stars Jeff Bridges, Matt Damon and Josh Brolin assuming the roles originated in 1969 by John Wayne, Glenn Campbell and Jeff Corey.
New Mexico
Shooting for True Grit also took place and recently wrapped in New Mexico, which also provided the backdrops for Crazy Heart, the lauded independent film that earlier this year earned Bridges the Academy Award for Best Lead Actor. Meanwhile the current feature docket in The Land of Enchantment also includes Cowboys & Aliens as well as Fright Night, both in production from DreamWorks, and such recently completed movies as Passion Play starring Mickey Rourke, Due Date starring Robert Downey Jr., and the comic book superhero film adaptation of Thor.
New Mexico additionally plays host to such TV series as In Plain Sight (which wrapped its third season), and the critically acclaimed Breaking Bad, again a leading Emmy contender, with those awards being bestowed later this month.
For the last fiscal year which wrapped June 30, 2010, New Mexico reported an economic filming impact of some $565 million, a healthy tally when considering the state of the global economy. Still, it represented a decrease from the prior fiscal year’s performance of $786 million.
Lisa Strout, director of the New Mexico Film Office, sees an economic recovery taking shape from a lensing perspective for New Mexico. She reported that activity has been on the upswing since April, which bodes well as New Mexico enters its 2010-’11 fiscal year.
Part of her agenda includes getting the word out to commercialmakers regarding New Mexico’s 25 percent tax rebate, which applies to spots and qualifying branded content/entertainment fare. “I think there are people in the advertising industry who don’t fully realize that regional and national commercials are eligible for the full 25 percent tax rebate we have in place for features and TV expenditures in New Mexico,” she said.
Strout noted that unlike many other states, there’s no minimum threshold in order to qualify for the rebate. “If you make a commercial that spends $10,000 in New Mexico, you’re eligible to get $2,500 back,” she affirmed, adding that New Mexico’s sizeable crew base grew out of commercials over the years. “Most of our professionals came out of work in commercials,” related Strout, “and have since broadened into TV and features. We have a deep, experienced crew base for commercials here. For some reason, business from commercials–which years ago used to be our bread and butter–is down recently.” But Strout is confident that can turn around based on the incentives and infrastructure the state offers. Car spots, she said, continue to be a strength, with major work for BMW. Recent ad biz has been generated by commercials for LG Electronics, Chanel perfume, a series of A&E Network promos as well as a Joe Pytka-directed spot promoting tourism in New Mexico.
While a huge studio film might get more high profile publicity, Strout noted that commercials and smaller independent movies could yield employment opportunities higher on the food chain. For example, an art director/production designer gig for a major motion picture might not go to a local talent. However, the same role on a spot or indie project could represent a viable opportunity for a New Mexico artisan.
As for the prudence of New Mexico’s substantive rebate program, Strout cited an Ernst & Young study which found that for each incentive dollar, $1.50 comes back to New Mexico in combined state and local taxes. This healthy return doesn’t take into account other economic benefits such as the exposure of New Mexico locales on film, TV and new media having a favorable impact on tourism.
Indeed as incentives translate into more filming, they also yield more comprehensive infrastructure. “We now have some 3,000 crew members here,” said Strout. “I remember when we had just hundreds. We have every service in place except for a lab related to film. Postproduction and visual effects resources are growing. Albuquerque Studios has eight of the largest soundstages in the world. We sustain the incentives program because it sustains our community and economy.”
Arizona
Ken Chapa, director of the Arizona Film Office, described commercials and branded content production as representing “the bread and butter of the Arizona production industry. On average, these projects account for over half of our total annual production days. In fact, over the past year we have seen about a five percent increase in production.”
At the same time, there have been changes in the nature of that ad work over the last few years. “For instance, we are seeing much more content being developed for Internet distribution….There seems to be a trend towards longer spots. Once again, I think the Internet has a lot to do with this. Lengthier advertisements that tell a more detailed story can be distributed on websites like YouTube and make their way to broader audiences in a more cost effective manner. In addition, the footage can be edited down for traditional formats.”
Among the clients who have chosen Arizona as their primary location for select commercial shoots this past year are Yamaha, Bridgestone, Infiniti, GoDaddy.com and Honda. On the feature front, Arizona has hosted during this same stretch such films as Everything Must Go, Piranha 3D, Queens of Country, Sedona the Movie, Valley of the Sun, and Sunset Daze.
Arizona offers a 20 to 30 percent transferable tax credit to pre-qualified projects. Eligible projects include feature films, TV, commercials, still photography and video games.
“The incentives have been a very aggressive tool in recruiting projects of all types. As more states and countries are beginning to extend their incentives to target commercials and branded content projects, I believe having a strong incentive program designed to specifically meet the needs of commercial productions will easily become a necessity to stay competitive, and must be addressed in every program,” affirmed Chapa.
However, there is some question as to the status of Arizona’s current incentives package beyond this calendar year. The program is scheduled to sunset on Dec. 31. However, it is possible to extend eligibility on a project up to 24 months if that project is qualified before Dec. 31. Chapa encouraged interested productions and companies to contact him so he can walk them through that process.
He added that there will be a new incentives bill introduced in early January 2011. If it passes both the House and Senate and is signed by the Governor, this incentive program could be in place by as early as late January 2011.
