Legislature confronts a Hollywood tearjerker

It’s hard to think of California without its film industry. For starters, Governor Arnold Schwarzenegger, a former screen action hero, is the state’s chief ambassador. But over the last decade, Canada and over 30 states have lured film production away from Tinseltown and other sites across California. In 2003, only 25 percent of studio films were shot in state, according to the California Film Commission. Six years later, though, that number plummeted to 11 percent.

The subsequent loss of carpentry, service and good film-industry jobs to other locales has some politicians now sleepless in Sacramento. “We used to have an aerospace industry and an auto industry that were very strong at one point,” said Assemblywoman Karen Bass, D-Los Angeles. “We didn’t think they would ever go away–now they are gone.”

Bass is hoping to stop the bleeding to other states by authoring legislation that offers financial incentives to studios that shoot in California. The bill, AB 1696, is also co-authored by Assemblymen Paul Krekorian, D-Burbank, and Anthony Portantino, D-Pasadena. “This isn’t about [a subsidy for] Hollywood or Los Angeles. It’s about the state of California,” Bass said. She points to studies that show how millions of dollars have flooded various counties and regions when films are produced there. “You have a number of small businesses, flower shops, caterers and others that benefit,” Bass said.

AB 1696 would expand the role of the state’s Film Commission by allowing its director to disperse grant money to studios and independent movie producers to help offset such production expenses. On Monday, the legislation sailed out of the Senate Business, Professions and Economic Development Committee on a 7-2 vote. It was referred to Senate Appropriations.

A separate bill, SB 740, authored by Senator Ron Calderon, D-Montebello, would have the California Film Commission administer tax credits for certain mid-level film and commercial productions (with budgets between $1 million and $10 million) that relocate or remain in California. On Wednesday, that bill was heard before the Senate Revenue and Taxation Committee.

Adam Gray, legislative director for Senator Calderon, said that regardless of whether one or both incentive-based approaches succeed in the Legislature, lawmakers share the same goals: stopping runaway production. “If one approach has more traction with the caucus, I think both the Assemblywoman and senator will be open to pushing that approach,” Gray said.

Opponents of similar legislation over the past few years have killed past attempts to provide production incentives. At question is whether taxpayers should subsidize the film industry. While there was no formal opposition to AB 1696 at last week’s hearing, Senator Jeff Denham, R-Salinas voted against sending the bill out of committee. Denham expressed concern about targeting a specific industry without specifying that the money would go to specific regions suffering high unemployment. “As we continue to pick and choose which industries we like or don’t like, I have a challenge with this law,” Denham said.

Still, Bass and the bill’s other supporters counter that the intent isn’t to help the Steven Spielberg’s and Jack Nicholson’s of the entertainment world. “This is about good middle-class jobs,” Bass said. Supporters also said that as runaway production has gotten worse, and states like New Mexico and Louisiana continue to build up infrastructure to court “bread-and-butter TV movie jobs,” there seems to be a change in political landscape this year. There may be bipartisan support to offering incentives for the film industry to remain in California.

But Bass admits that in its current shape her bill is a work in progress. Currently there is no provision for where funding for the grants will come from. And at last week’s hearing, none of those testifying in support of the bill could say what the amount of an average grant was likely to be. Finally, an earlier Assembly committee analysis expressed concern with the amount of power the bill grants to the director of the California Film Commission to administer grants.

Indeed, if either bill passes through the Legislature and is signed into law by Schwarzenegger–who has expressed support for film incentives in the past–the California Film Commission would undergo a major shift in its mission: toward economic development. The commission was formed in 1985 to encourage filming in California, and help facilitate free location permitting with other state and local agencies. Currently, the board has eight full-time staff, including its director Amy Lemisch.

Lemisch said that she sees the commission’s role as promoting “film friendly policy at all levels.” She said that while this includes trying to attract and retain production in California, clearing up red tape for location scouts and producers can only go so far. “Unfortunately, the major decisions on where people are locating right now is based on financial reasons,” Lemisch said.

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