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Scott Thomas Wilk: We must keep Hollywood in Hollywood

Right Here, Right Now!

Posted: May 18, 2012 1:55 a.m.
Updated: May 18, 2012 1:55 a.m.
 

People from all over the world travel to Hollywood in the hope of seeing their favorite celebrities or visiting iconic landmarks featured in their favorite films. While the glitz and glamour of Hollywood may never die, California’s foothold as the leader in feature film and television production continues to diminish.

The industry creates thousands of jobs each year, and not just for actors, makeup artists and set designers; but ancillary services, such as catering and more. In Santa Clarita, 7 percent of our city’s workforce is directly involved in the film industry.

Other states have seen rapid growth in their film industries because of generous tax incentives and lower overall production cost. In fact, Louisiana reaped more than $900 million in film production last year.

What has led to the decline of film production in California? Inadequate tax credits, burdensome permitting process and higher labor costs.

Sacramento has been offering a $100 million tax-incentive program since 2009. It’s a start, but not adequate to make any real change. The money offered isn’t that much in relation to production costs, so production companies are forced to participate in a lottery program to divide the existing incentive.

In addition, a level of uncertainty is created for the producers, because it hasn’t been authorized for five years. When producing a TV show, producers want to know that they will receive the credit for the entire duration of the series. TV and film production is like any other business; if the venture doesn’t pencil out to make a profit, you are not going to do it, or take it elsewhere to reduce your costs.

Legislation is currently pending in Sacramento to extend the program for five years, but we need to do more. California should at least match what the state of New York offers, which is $400 million in film tax credits.

In a UCLA study, 90 percent of film producers said that film tax credits are likely to directly influence their decision in where to film. We must keep them here in California because it will benefit our state economically.

I have reviewed various economic studies, and they show that for every dollar the state invests in film tax credits it receives a rate of return of at least $1.13. Who wouldn’t kill for a 13 percent return on investment?

However, our current fiscal situation demands that we be vigilant in the creation of a long-term incentive program. We must develop an understanding of what incentives are offered by rival locations. California can then use specifically targeted programs to sweeten the pot in our favor.

A second step is eliminating regulations and streamlining the film permitting process to reduce time and costs. Increasing the responsibilities of the California Film Commission may be one possible solution. A one-stop shop for film permitting would greatly reduce the permitting burden on production.

The FilmLA nonprofit organization has helped do this for Los Angeles. We should learn from its example and establish easier permitting processes throughout California.

The losses created by runaway film production are more than just economic loss because it has negative ramifications on our families, as well. It’s not uncommon for my wife Vanessa and I to meet someone new at an event and learn his or her spouse is not with them because he or she is filming outside the state.

Recently, I met a woman whose husband works in feature films. She said he hasn’t done a film in California in more than six years.

Last weekend, I met an independent film producer who last year spent 5 1/2 months outside the state. He laid the blame on Sacramento and their disinterest in keeping the film industry in California.

The film industry belongs in California, not in Michigan, Louisiana or New Mexico. Santa Clarita is within the Thirty Mile Zone, or TMZ, and it’s critically important to our friends and neighbors that this industry continues to thrive.

Assemblyman Cameron Smyth, R-Santa Clarita, knows this, and has been a strong advocate for the industry in Sacramento. Since he is facing term limits, our next Assembly member must carry that torch.

Sacramento politicians must be committed to fostering a business climate that encourages the film and TV industry to stay home in California.

No one loves a happy ending more than Hollywood, and an expansion and extension of the tax film credit will be the award-winning script for keeping Hollywood in Hollywood.

Scott Wilk is a small-business owner. He is a member of the California Republican Party, appointed by Assemblyman Cameron Smyth.

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