Friday, April 12, 2013

Hillsborough looking for Film Czar

Today, we're proposing to spend $500,000 for a film czar.
Those who have doubts about the wisdom of Hillsborough County devoting $500,000 over two years to help build the local film industry should consider this:
A high-budget feature film can spend as much as $260,000 a day on workers, hotels, restaurants and other local services.
According to the Association of Film Commissioners International, even a low-budget independent film can spend $30,000 a day. A music video can bring in between $30,000 and $110,000 a day in spending. A commercial, between $25,000 and $150,000.
Obviously, this is an industry that pumps money and jobs into the economy, and Hillsborough County Commission Chairman Ken Hagan is right to push the county to pursue it.
We have a few doubts. First, why would the Tribune solely cite Association for Film Commissioners International, a special interest group if there ever was one?

Spring Breakers -- Shot in Tampa Bay!
The film industry is notorious for chasing tax incentives to subsidize it productions. Not just nationally, but globally.  Politicians cannot resist being close to the "lights, camera, action", perhaps to get a cameo appearance, and rub elbows with the stars.

Is this why?
It wouldn’t take many successes to have a big fiscal impact. As we’ve pointed out, “Dolphin Tale,” which was filmed in Pinellas County, had an economic impact of $17 million and provided jobs for about 1,500 Floridians. It is still attracting tourists to the Clearwater Marine Aquarium.
Actually, Commissioner Ken Hagan recently stated on 970 WFLA the impact was $580M(!). (around the 2:30 mark).

A Dolphin Tale - Shot in Clearwater
We just need a little creative Hollywood accounting to make up the difference.  According to the Trib:
But the focus would not be solely on attracting feature films. Digital media is creating many high-paying jobs, including animators, computer specialists and graphic designers.
Florida has already been down this road... and failed.  $20M down the drain.
TALLAHASSEE -- Call it another unfortunate plot twist in an already upsetting script.
State taxpayers, who handed out $20 million in incentives to a now bankrupt movie studio, are being asked to dig back into their pockets to pay lawyers to try to get the money back.
The state Department of Economic Opportunity has hired bankruptcy attorneys Sean Cork and Albert del Castillo at $540 per hour to try to reclaim money awarded in 2009 to Digital Domain Media Group — the animation company behind Titanic and founded by popular director James Cameron.

The $20 million in incentives helped lured Digital Domain to Port St. Lucie. But the company filed for bankruptcy in September, closed its offices and laid off 300 Florida workers.
Sounds like good work for bankruptcy attorneys.
A special deal ripe with cronyism as well.
Scott has ordered an investigation into how [Digital Domain] received state funding.
In September, the Herald/Times reported that state Rep. Kevin Ambler, R-Tampa, tucked the funding into the 2009 state budget. Ambler later got a $20,000 position on Digital Domain’s board, and the company hired Ambler’s son.
Neither Ambler nor Digital Domain could be reached for comment.
There are still open questions on this deal.
Regardless, this digital production jobs are highly portable, and increasingly offshored (page 23).

Like most of these targeted subsidies, it has doubtful economic value to the local community.  From the heart of Hollywood, the LA Times:
SACRAMENTO — As Gov. Jerry Brown mulls whether to sign into law another round of subsidies for Hollywood production companies, the question that confronts him is how much each job on a movie set is worth to taxpayers.
In Massachusetts, lawmakers recently discovered a similar program was much more expensive than they thought. After years of subsidizing film productions without looking too closely at how that was helping the economy, state officials put it under a lens and found that taxpayers were spending as much as $300,000 to bankroll each position.
Other states that went in for a close-up after dispensing hundreds of millions of dollars in tax breaks found that every public dollar put into the film industry was generating a few dimes, or less, in revenue. 
At least the Trib raises some caution:
There are plenty of challenges. The county will need to attract private funding to be able to provide the kind of incentives needed to close digital-film deals.
The report recommends half of the $500,000 be allocated for incentives in the program’s first full year. It also would tie any incentives to minimum economic impact, use of local workers and other requirements.
It is important any incentives come with such strings tightly attached. With many states competing for these projects, incentives can be a necessary — and appropriate — investment. But we also have seen how overly generous incentives can result in waste and abuse.
But is there any evidence we've seen lately that our local politicians can exercise this kind of judgement and discretion?

If we proceed with caution, perhaps we'll have a blockbuster.  If not, we won't be celebrating another Hollywood flop.

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