Newspaper headlines on the budget crises in almost every state are everywhere these days. The headlines are justifiably almost always about cuts in schools, prisons, police and health care. But for the motion picture, television and commercial production community, the story beneath the radar is the pressure that tight budgets are putting on state film commissions—the bodies that facilitate on-location filming, help states provide incentives to producers and, collectively, play a role in keeping production in the United States.
Film commissioners note that it’s sometimes difficult to defend what they do when governors and legislatures are cutting critical public services in an effort to narrow budget gaps. Many in and out of state government see the film offices as unnecessary. Film commissioners respond by pointing out that their relatively small budgets help generate heavy in state spending by filmmakers.
"The film office is the first to be cut, even though they’ve constantly proven their worth in terms of the economic return on investment they’ve brought," says Dawn Keezer, director of the Pittsburgh Film Office, and chair of Film US, a trade group of state film commissioners that seeks to keep film work in the United States. It seems very shortsighted to cut the budgets of people bringing money in."
The Pittsburgh Film Office, she says, brings $45 in production to the region for each dollar of its budget. Others cite ratios as high as $100 to $1. Matt Miller, president/CEO of the Association of Independent Commercial Producers (AICP), says spotmakers recognize the value of film commissions. "There’s nothing more valuable in a location shoot, especially a complex one, than a film commissioner," he stresses. It plays the other way, too, he adds, with commissions earning their keep in the states. "If you take that piece out, who is going to be out there attracting what is a very lucrative, low-impact business?" he notes. "With locations all over the world competing for our shoots, it would be the equivalent of knocking out your customer service department."
So far, only a handful of state film offices have been closed. Where that’s happened, stopgap measures have been put in place to provide some services. Ohio and Wisconsin offices were shut, but in the former, the state tourism office along with the nonprofit Greater Cincinnati & Northern Kentucky Film Commission and Greater Cleveland’s Film Commission are picking up the slack. In Wisconsin, the director of marketing for travel and tourism has stepped in. In Massachusetts, the state film office closed, but the production community in the Boston area set up a privately funded office.
The Washington State Film Office narrowly avoided closure, and today operates with full funding. Still, commissioner Suzy Kellett says it’s difficult to prove value to the state. "The national film industry understands the benefits of a film commission, the time and cost savings," she says. "Historically, it has always been far more difficult to convince local governments that this is worthwhile and should be funded and supported and increased. Many [commissions] don’t have huge budgets, but the return on the dollar is huge. In the past decade, for every dollar this office spent, the industry left one hundred dollars."
Compounding the difficulty film offices are having in protecting their budgets is the fact that, in most states, film production was off sharply in 2001 and ’02. In Washington State, for example, overall production spending declined through the late ’90s to $17.5 million in ’99. It boomed in ’00 to $50.5 million on the strength of an extraordinary 18-fold increase from ’99 in TV production to $42.7 million. Spending fell in ’01 to $21.3 million and was lower in ’02, Kellett says, although final numbers aren’t yet available. Commercial production spending was steadier, but also declined from a level of more than $12 million in ’95 and ’96 to $6.5 million in ’00 and $3.3 million in ’01.
Marketing Ideas
States like Arizona and Colorado, where deserts, canyons and mountains attract heavy filming in all categories, have both had their film offices cut sharply. These and other states are taking some innovative measures to maintain service to the industry. Over the last couple of years, Colorado has had its film commission budget cut three times, most recently last June, and its staff has shrunk from six full-timers to three, with two part-time staffers, according to Stephanie Two Eagles, program manager for the Colorado Film Commission. "We had to regroup," she says. "We have a new Web site with a searchable database. That helped because we’re a lot more efficient for scouting. We have a lot of information online now and the production guide gets about two hundred hits a day."
The Web site was funded through a grant from a state marketing agency and Two Eagles has benefited from volunteer interns and a pro bono ad campaign from MGA Communications of Denver. Former MGA creative director Anthony Castellano continues to do creative for the commission out of his new firm, Castellano Advertising & Design, Lakewood, Colo. The Colorado Film and Video Association publishes the state’s production guide and the local film community came up with $11,700 to match a state grant for a University of Colorado research project on the contribution of the film industry to the Colorado economy. The commission also has a training program in place called Colorado Camera Ready. "We’ve been training our communities on how to set up a local film commission since 1991," Two Eagles says. "We have over one hundred local contacts throughout the state who are trained. In times like these, our communities have really gone to bat. We give producers general information, and from there, when they decide they could work in Telluride or La Junta, we put them in touch with the local contact."
Feature filming has been slow in recent years, Two Eagles says, although low budget indies are still being shot in Colorado. "Major feature films are going to Canada," she explains. "Canada looks like us. We had a piece of About Schmidt filmed here and HBO’s The Laramie Project in 2001. Commercials are strong for us; we get a lot of car shoots."
The Arizona Film Commission has seen its budget cut by about 58 percent over the last year, according to its director, Robert Detweiler. "We’ve done some things internally to restructure and to keep the film office going because it’s been a target," he says.
Detweiler, who was in the film business himself and later helped Arizona establish its Rural Development Office, used that experience to reposition the commission. "When the previous director resigned, we put together a proposal that brought the film office under the Rural Development Office," he explains. "That allowed us to provide some things that weren’t available before," but not at the expense of urban locations, he says. "It was a bit easier to display the return on investment when we had a bit more of a focus on the smaller communities."
Detweiler notes that Gov. Jane Dee Hull has said the state is done cutting agencies. "We feel pretty good about keeping [our office’s budget] where it is," he says. "We’re probably not going to be able to do the marketing that everyone would love to do, but we still can do the marketing that keeps us in the game. We’re fortunate that we have a good portion of commercial work." The Arizona commission counted 134 film projects in the fiscal year (which ended on June 30, ’02), including 53 commercial shoots and five features.
Public Vs. Private
In Ohio, Chris Carmody, president of Greater Cleveland’s Film Commission, says the new arrangement with the Cincinnati-area office works better than the defunct Ohio Film Office. "The Ohio Office of Travel and Tourism channels all Southern Ohio requests to Cincinnati and all Northern Ohio requests to us," Carmody explains. Both film offices are nonprofit, private-sector operations, which gives them advantages over the state office, he continues. "The state office couldn’t offer incentives—even something as simple as taking producers to lunch. One person could not adequately serve the eighty-eight-county area, and we found producers were often confused about where to start. And, as a public employee, the state film commissioner, by law, could not lobby the state to make government more film-friendly. Both of our organizations can. The closing of the state office has been a shot in the arm for us."
In Wisconsin, film office functions have been handed over to Sarah Klavas, director of marketing for the Wisconsin Dept. of Tourism, who says the state’s location between Chicago and Minneapolis has helped to attract increased commercial production. "Marketing feature film production and television commercial production is very similar to marketing the state as a leisure travel destination," Klavas says, although she acknowledges that the office works to assist filmmakers who have decided to film in Wisconsin rather than try to attract them to the state. "We don’t have an aggressive marketing posture. We’re reactive," she says.
In Massachusetts, where the state shut down the film office last July, the local film community banded together to form the private Massachusetts Film Bureau, headed by Robin Dawson, who had been director of the state office. Bob Hirsch, manager of film and video lighting for Boston’s High Output, helped establish the new office, which he says will perform many of the functions of the state office, and will lobby the state to reestablish the film office. "We realized we had to create a privately operated office that would serve production from out of the area and advocate for our local organization," Hirsch says.
He is optimistic that a public-private office will happen, despite a state budget crisis. "High Output supplied equipment for Mitt Romney’s campaign advertising," Hirsch says, referring to the new governor of Massachusetts. "He didn’t miss an opportunity when he was on a film set to approach the technicians working there and let them know that he understood the need for a state film office."
Incentives
One area that may suffer as states grapple with budget shortfalls is their ability to provide any new or expanded incentives to visiting filmmakers. Most states have offered tax relief in the form of sales or hotel tax rebates, but almost all of the latter require a 30-day stay, which generally rules out commercial shoots.
"Incentives aren’t something states want to look at right now," Kellett says. "We have some. I know Oregon is trying to do theirs, but this is not the climate to try to make that happen."
Only a couple of states are providing real financial incentives. The Film California First program reimburses certain film costs—such as state, local and federal employee costs and some local use fees—incurred on public land, up to $300,000 per production. Gov. Gray Davis has supported that and other incentive programs vigorously, but no state program seems secure, given the state’s severe budget crisis.
New Mexico put two new incentive programs in place last year. One provides film companies with a 15 percent rebate on all direct film expenditures made in New Mexico during production, and the other allows for direct investments and low interest and interest-free loans for film projects using local people. For the latter, New Mexico recently invested $4.7 million in a feature film called Blind Horizon. The film, directed by Michael Haussman, who directs spots via bicoastal Person Films and London-based Serious Pictures, was shot in Las Vegas, N.M.
Florida and Miami-Dade County are both considering rebates on film spending, according to Jeff Peel, director of the Miami Dade Mayor’s Office of Film & Entertainment, but nothing is in place yet. The Miami-Dade office has doubled its marketing budget to about $225,000, Peel says, with the Visitor and Convention Bureau funneling in another $100,000. In South Florida, Peel says the year is starting out strong. "This is the height of our season right now and we’re seeing a lot of activity on features and the commercials side," he notes. "And a couple of TV pilots look like they’re coming here."
Peel notes that ’02 was a good year for filmmaking in the area. "We had a lot of big feature films last year," he says. "We did a little over sixty-million dollars in features, over twenty-five million in TV and almost thirty-five million in commercials." Peel hopes the additional marketing dollars will help bring even more work to the area this year.
Collectively, rebates and tax incentives are believed to have an influence in curbing runaway production, and the state commissions are seeking broader federal incentives through Film US, a four-year-old association of 196 state and local film commissions. Keezer says that the organization’s mission includes educating state governments about the size and importance of the film production business and the value of film commissions, and helping to keep production in the United States. "The problems U.S. film commissions are having are making us less competitive." Keezer says. "Other countries are adding more incentives to get the work."
Film US is working to reintroduce legislation in Congress that would provide a federal tax credit to filmmakers shooting stateside "Last year, we got seventy-seven congressional co-sponsors, which is huge," Keezer says. But House and Senate bills died when Congress adjourned.
As to the outlook for local production or the commissions themselves, the commissioners, in general, don’t profess to have a crystal ball about the rest of ’03 and years beyond. "The industry is very cyclical," Keezer says. "And I believe the ebb and flow of state economies also is cyclical, so I’m confident and hopeful that people will see the value of these film offices and rally together."
Kellett suggests the national production industry will never be what it once was, except in a few major centers. "It’s gone global and it’s never coming back," she says. "This year hopefully will not be as terrible as this last year was, but it’s hard to predict more than three months in advance."
