Saving Our Signature Industry

California’s legislature will go back into session next week and one bill we will be pushing for final approval is AB1839, which will expand the State film and television tax credit program for five years and increase eligibility. It would not be an exaggeration to say that the future of our California entertainment industry hangs on its passage.

The California Film Commission (CFC) released its annual Progress Report last week which revealed some interesting data about the State film and television tax credit program, which was adopted in 2009, and allots $100-million annually.

Based on its aggregate data, every $100-million in the program generates $770-million in direct production spending. This equates to 8,700 cast and crew-member jobs, 66,000 daily hires, and the utilization of 10,000 vendors.

This year there were 502 applications for the tax credits. From those, 26 projects were conditionally approved and the other 476 were placed on a waiting list. What was interesting about the CFC report is that for the first time they have tracked what happened with applicants that don’t get funded. They found that 84-percent ended up filming outside California. They go to 40 states with attractive tax credit programs, like Louisiana, Georgia – and New York, that has a $420-million tax credits program.

The CFC also found that production of one-hour TV series in 2013 hit a nine-year low, with just 39 out of 137 choosing to film in the State. The California market share declined from 65 percent in 2005 to just 28 percent last year – a market share decline of nearly 60 percent.

Earlier this year, FilmL.A. revealed that California’s share of the top 25 live-action movies at the worldwide box office declined from 65 percent fifteen years ago to just 8 percent in 2013 shooting in the state.

I hate to overwhelm you with statistics … but I wanted you to get the picture. These trends are not going in the right direction, and are downright alarming. The only way to reverse this outflow is for California to become more competitive. No dollar amount has yet been attached to AB1839, but the budget must be increased significantly for us to retain these productions and the thousands of jobs that go with them.

I recently read a story on entitled “Why Louisiana Is the Next (and Better) Hollywood.” Here are a few excerpts from the article: “Hollywood still exists, but movies aren’t being made there.” … “We wonder about the iconic town’s future when Hollywood’s primary export is being produced elsewhere.” … ”There’s an idea in New Orleans that it’s a place where dreams come true, and Hollywood used to have that.”

Ouch! That hurts. Isn’t California supposed to be the place where dreams come true? I realize that budgets are tight, but the California legislature has got to find a way to increase the tax credits program substantially.  If we aren’t willing to fight to save California’s signature industry, then what are we willing to fight for? There are thousands of individuals in our state who are suffering financially or are having to travel out of state and be separated from their families and loved ones in order to make ends meet.

This is a top priority for the Hollywood Chamber of Commerce – and it should be for the California legislature too, because it’s all about JOBS!

Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

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