These aren’t good times for state and regional film commissions, and that’s impacting the commercial production companies they have traditionally courted. A real disconnect has developed, as state after state copes with budget shortfalls. Spotmakers, under their own fiscal pressures, are looking first for location-advocates to help them with bottom-line profitability—real money. But film commissions, with few exceptions, don’t have the funding from their states to do much more than publicize locations, help with permits, facilitate jobs and waive some tax obligations.
Some commissions are seeking innovative ways to market their states to spotmakers on tight budgets. For example, a contingent of film groups in the state of Florida recently broke a series of online short films specifically aimed at the commercial production and advertising communities (see separate story, p. 13). Some are hunkering down, trying to ride out hard times in state budgeting. And some, like the Minnesota Film & TV Board, are doing a sort of triage that leaves commercial production out in the cold.
The Minnesota film office, which once actively courted commercial makers, has had its budget cut by two-thirds, and executive director Craig Rice says he is making little effort to lure spots to the state. "I don’t see how that works any longer," he says. "They’re not coming [because there aren’t many cost savings]. They need the incentives, and it’s understandable. It’s the business we’re in. Since we have such a low level now of budget allotment from the state, all our money has to be spent in the right areas, which now means attracting [feature] filmmakers, keeping the filmmakers here happy and trying to develop work as much as we can."
Rice says Minnesota was one of the first to give filmmakers a rebate—10 percent—on production dollars spent in the state, but now it is concentrating on non-equity incentives, such as free location use and free public services. Although Rice says his office is hoping to develop another equity incentive program, he adds, "Our goal right now is to hunker down and not be foolish about the little bit of money we have left. It’s about survival and being able to fight another day."
Commercials are getting short shrift in Pennsylvania, too. Dawn Keezer, director of the Pittsburgh Film Office, says the state’s sales tax exemption doesn’t include commercials. "It has to be a program over forty minutes in length," she notes. "We’re working on upgrading that and we’ve got legislation in the works now that would include commercials."
Keezer says a lot of state and regional film offices are hurting these days, and she mentions a recent lunch meeting with a funding body that turned into a series of meetings after lunch and even more phone calls later. "None of [those meetings or calls] had anything to do with bringing work into southwest Pennsylvania," she recalls. "It’s all about finding money to stay operational."
Ray Of Hope
Fortunately, things aren’t as bleak everywhere. Louisiana and New Mexico are offering real financial incentives, and other states, like Florida, Utah and Washington, are courting spotmakers aggressively. Leigh von der Esch, director of the Utah Film Commission, considers her office fortunate in that it took only a 12 percent budget cut—to about $600,000 a year—and that the Sundance Film Festival, held in Park City, Utah, brings hundreds of filmmakers to the state every year.
The emphasis is on maintaining client services and on reminding commercial decision makers of the state’s great locations. "We’re just pushing our diversity and the film-friendliness of shooting around the state," von der Esch says. "What better place to show off a vehicle that is good on the streets of the city and good on the mountain roads of southern Utah."
Von der Esch tries to hit as many of the various production expos as she can, and the office keeps the commercial production community supplied with calendars and other materials highlighting the state’s scenery. "We’ve done a ‘Bookmark This’ campaign, with six different scenes on laminated bookmarks," she reports. "It’s a very inexpensive way to get pictures of Utah out, and people seem to love them."
The state currently has no tax exemption programs, but von der Esch is working on that. "We are trying to get some proposals before our legislature," she says. "I don’t know if production funds is a possibility, but that’s certainly something we’ve submitted."
But even with a budget many states would die for, von der Esch looks for ways to market the state frugally. On a recent trip to court agencies in New York, she teamed up with Suzy Kellett, director of the Washington State Film Office, to share expenses and make meetings more productive for agency people. "You hope you can open the door because someone knows that they can see two different types of locations," von der Esch says. "It enabled us to get our combined messages out. At the Production Hub in London a year ago, I shared a booth with Mississippi, Virginia and some other commissions, just so we could all get to the production community in London, which we couldn’t afford to do singularly."
In the fiscal year that ended on July 30, commercial producers spent $13.7 million—out of total film expenditures of $135.5 million—in Utah. Car spots dominated activity, with advertisers that included Ford, Dodge, Chevrolet, Cadillac, Honda, Hummer and Acura.
Von der Esch’s friend and traveling companion Kellett of Washington State says her office is making a concerted effort to focus on attracting commercial work, particularly in the car category. "I’m putting together a ‘Roads’ CD and DVD, which will be a selection of Washington roads," Kellett shares. "That’s a big request from car shooters. It’s everything you could think of with roads. That will be available by the middle of December."
Just finished is a Washington State commercial directors reel highlighting local talent. "We received one hundred and seventeen spots," Kellett reports. "We culled them down to about a seven-minute video of what a panel of industry members thought was the best representation. We will do a traveling industry road show, visiting local ad agencies, making sure the local ad agencies know what’s current and available. We’ll set up in the lobby with coffee and scones and let people wander into their own lobbies. I’m looking at starting at home and then rippling outward." Recent commercial work shot in the state includes spots for Honda, Yamaha, Microsoft, Saturn and the U.S. Army.
Kellett and representatives from the Seattle Mayor’s Office of Film and Music—which recently cut fees for shooting in the city—visit the production and agency community in Los Angeles a couple times a year, and she is planning to visit Minneapolis and Chicago. Actual incentives don’t seem likely in a state hard hit economically. Kellett says her budget has remained at $375,000 a year, but with no increases to counter rising costs. "I would love to have more incentives in place," she says, "and it’s under discussion. The industry is shopping incentives more than they are shopping locations these days. If you’re not in that game, the big issue is what do you do. I’m not sure the heyday of on-location filming as we knew it is going to come back. It’s just gone global and that’s how it’s going to be from now on."
Pat Swinney Kaufman, deputy commissioner and director of the New York State Governor’s Office for Motion Picture and Television Development, says she has no budget for marketing, per se, but manages to pay for some advertising and marketing activities out of her operations budget. "We respect and treat and want commercials [like] we do film and television," she asserts. "As a result, everything we offer to film and television we offer to commercials. Just before the Production Expo Plus show in New York City, we did a mailing to agencies and commercial production houses there inviting them to the show and sending them our package of materials. We said, ‘Commercials are extremely important to us, we really want your work.’ We hadn’t done that before."
The main financial incentive in New York consists of exemptions from almost all sales tax and free permits, parking and police support. Advertising production days in the state are up 25 percent this year, Kaufman says, including big jobs from Mercedes-Benz and Microsoft. She doesn’t have 2003 spending figures yet, but says commercial production amounts to about one-fourth of the hundreds of millions of dollars that are spent in the state each year.
Large Savings
The bright spots today for commercialmakers scouting locations are New Mexico and Louisiana, both of which are giving them what they want—help with the bottom line.
New Mexico is more commercial friendly right now, with no budget thresholds to qualify for rebates, but the Louisiana Governor’s Office of Film and Television Development is working on getting the state legislature to lower its thresholds to include more spot jobs. The state offers sales tax exemptions for projects spending over $250,000, and labor and investment tax credits for jobs over $300,000. Mark S. Smith, director of the film office, explains that a production can qualify for all three exemptions and turn them into real money. "We have brokers in the state who will buy those credits from the production entity at a discount," Smith says. "You’re going to know before you shoot that you’re going to get fifty-five to sixty-five cents for the credit dollar. That ends up being a production rebate back to the producing entity."
Smith is also working with the legislature to make the program more attractive to commercialmakers, with the possibility early next year of turning to direct rebates and lowering thresholds. For the time being, he is focusing on features and moving slowly to make sure the infrastructure can handle new business. "We’re trying to get a handle on feature film production and then get more aggressive with the commercial production," he notes. "Commercials are here a shorter period of time, but the dollars they leave are definitely greater. It’s another way of keeping a vibrant and qualified workforce."
Recent work that earned rebates includes spots for the Lincoln Aviator and Navigator, and a commercial featuring John Travolta for the new Italian satellite TV service Sky Italia, which took advantage of the fact that Travolta was in New Orleans, filming the feature A Love Song for Bobby Long.
In New Mexico, Frank Zuniga, director of the New Mexico Film Office, says that not only are there no spending thresholds for productions to meet to qualify for rebates, but his office is also advocating a rebate on postproduction. "In the new year, we’re going to concentrate a lot on bringing commercials into the state," Zuniga relates. "One of the things we’re considering as part of the next legislature is stand-alone post, giving a fifteen percent tax rebate for work done in New Mexico."
While he already terms New Mexico a commercial-friendly state, Zuniga sees a need to make his office more responsive to the quick turnarounds production companies need to put together bids. "We need to ramp up because we now know that in the digital environment response time has been reduced to twenty-four to forty-eight hours in terms of bids," he says. "In 2004, you will see us being much more aggressive in the commercial arena. We’re in a planning phase on how best to address the challenge … [of] bringing more commercials to New Mexico. They’re our bread and butter."
