According to the results of a survey analyzing the financial impact of commercialmaking in the Chicago metro area, local spot production yielded $59.8 million in direct production expenditures in ’99.
The survey also analyzed the secondary benefits that the Chicago commercial production industry provides to the community, in terms of revenues to hotels, restaurants and shopping establishments; findings revealed that the indirect economic impact to the region was $79.5 million last year. All told, the total economic impact was $139.3 million.
These were among the key findings of the survey, commissioned by the Midwest chapter of the Association of Independent Commercial Producers (AICP) in conjunction with the Chicago Entertainment Industry Labor Council and the Illinois Department of Commerce and Community Affairs.
The Midwest AICP devised the survey to educate the state and local governments, and citizens, as to the significant size and positive benefits of the commercialmaking industry, in order to make Chicago a more commercial production-friendly environment.
Midwest AICP president Alan Sadler said that one short-term goal of the survey would be to eliminate Chicago’s six percent transfer use tax, which is levied on all rental equipment and props. Chicago is one of the few cities where such a tax exists. Other states in the country have passed legislation to provide sales tax rebates or to abolish the tax altogether.
Given the extent of runaway production-exacerbated in recent months by the striking Screen Actors Guild (SAG) and American Federation of Television and Radio Artists (AFTRA)-it has become all the more important for Chicago to demonstrate the fiscal benefits of local spot production to the local economy.
Sadler related that the Midwest AICP was prompted to undertake this survey after a meeting last year with Ron Ver Kuilen, director of the Illinois Film Office, and Rep. Jerry Weller (R-Ill.), a member of the House Ways and Means Committee. A proponent of anti-runaway legislation, Weller is a co-sponsor of the Association of Imaging Technology and Sound (ITS)-supported proposal that would grant an investment tax credit to the postproduction industry to ease its transition to DTV (SHOOT, 8/14/00).
"We asked specifically what we could do to help [Weller] with his goal of limiting or eliminating runaway production," said Sadler.
Sadler observed that it’s very hard for Chicago to even think about competing with Canada because of the exchange rate and its package of financial incentives to shoot there. But, he added, the Midwest AICP believes that any concession that the city can provide to lower costs for shooting in Chicago will be greatly rewarded by the amount of dollars and jobs created in Chicago.
"We’re competing [for production dollars] with every other city in the country, as well as with cities in Canada like Toronto and Vancouver," said Sadler. "The clear benefit of shooting commercials in Chicago is the tax income to the city but, more importantly, the monies going to individual citizens/crew members who work on those productions…as well as to the small businesses, suppliers and stages whose success depends upon shooting TV commercials in Chicago."
The survey’s results were based on the responses of 38 local companies and 18 out-of-town companies-representing an 80 percent return rate-that had shot at least one day in the metro-Chicago area during ’99. In preparing the survey, Sadler said, he talked to a number of executive producers and asked them what kinds of questions they would be willing to answer.
"No one wanted to report to me how much they necessarily bid for a job, what their markup was or what the director’s fee was," said Sadler. "But they all agreed to answer how much they spent for a job-which was really what I was most interested in. So it was actually [a reflection of] their A-K [lines on the AICP bid form] expenses."
The 33 survey questions largely reflected most of the categories on an AICP bid form, such as how much a respondent spent on equipment/stage rental, props, wardrobe, talent casting and crew; as well as the total number of crew days. No postproduction, music, feature or broadcast television monies were included.
The study results have been sent to a number of city and state officials, including Rep. Weller, Illinois State Senator John J. Cullerton (D-Chi.), Chicago Mayor Richard M. Daley and several of the mayor’s staffers.
In addition, copies have been sent to Alderman Edward M. Burke (14th Ward), chairman of the Finance Committee of the Chicago City Council; and to all the Finance Committee members. Last month, the Finance Committee considered, but took no action upon, a proposal to ban the shooting of non-union commercials on Chicago public property in support of striking SAG and AFTRA members (SHOOT, 7/28/00).
