A bill introduced in the State Senate in the waning days of the 2014 legislative session threatens to undermine the growing film industry in Mobile, according to people familiar with its language.
Eva Golson, director of the Mobile Film Office, said she was “shocked” to learn about Sen. Del Marsh’s proposal to suspend film incentives for a period of two years to divert money to the Education Trust Fund, state General Fund and the Alabama Tourism Department.
“There was no consulting between the state film office and my office or anyone else,” Golson said about the bill, which she learned about through the grapevine last night. “This came as a total shock.”
Alabama’s Entertainment Industry Incentives Act of 2009, which Marsh helped create, has provided for as much as $62.5 million of incentives to production companies filming in the state through Fiscal Year 2014 and will continue to provide $20 million per year thereafter. Marsh’s new bill, introduced in the Senate’s Finance and Taxation Education Committee March 18, seeks to suspend the incentives from Oct. 1, 2014 until Oct. 1. 2016.
Golson said since 2010, the incentives have helped inject more than $72 million in direct investment into the local economy, a number that doesn’t include broader economic impacts.
“Before the law, the industry didn’t want to talk to us because we didn’t have incentives and everybody else did,” Golson said. “We were making movies before, but I always believed if they can do this any other place we can do it here. With the incentives… we have been doing so well down here.”
The law provides qualified production companies a 35 percent reimbursement for hiring local crew members or a 25 percent reimbursement for bringing in crew members from out-of-state. Golson said the state “doesn’t pay a penny” until a production company has turned over its receipts, which are then gone over with a fine-toothed comb.
Some local productions that have come to life because of the incentives include October Baby, Counterclockwise, Sweet Home Alabama seasons 1-4, Big Shrimpin’, Skyhook, Give It All Away, Today’s Homeowner with Danny Lipford, Phoenix Rises, Homefront, Yellow Day, Oculus, Tokarev, Convergence, Somnia and The Prince.
Drew Hall, a local film industry professional who has worked in a director capacity for a total of five productions in in the state, said the industry is “nomadic” and if Alabama suspends its incentives, production may leave and never come back.
“Outside production will go where the money is,” Hall said. “If you suspend it once you’ll lose it. Look at California, where you have fewer incentives than ever and the mayor of Los Angeles recently declaring war on ‘runaway productions.’ In the ‘90s a lot of production moved to Vancouver. North Carolina and Michigan were hot spots recently until they changed their incentives and production there has not dried up but it’s lower.”
Hall said another positive effect of the incentives has been to build the professional skills of the local workforce.
“I can’t speak for everyone but one pillar in the business structure was to build the labor pool and we hired as many locals as we could – some of them were untrained — to get them in the spot while they gained their training as part of an initiative to help support the community. Now, when new [production companies] come to town they are hiring to a competence and ability level and we’ve helped increase that depth chart…that’s more work kept in-state.”
Dan Lumpkin, a Fairhope consultant and father of local filmmaker Scott Lumpkin, said the state not only needs to retain the incentives is has, but also needs to expand them.
“Our problem is that people get stars in their eyes and will not listen to the appropriate way to construct a film incentive bill that protects the interest of Alabama, keeps money and creates jobs in the state and rewards the film companies for actually bringing films of significance to the state that impact the economy,” Lumpkin wrote in an email. “The state passed a $23 million incentive bill, but for example Scott’s last film in North Carolina was a $40 million dollar film, so Alabama doesn’t have a shot at the films that bring better revenue… A tax incentive is not all inclusive there are limits that it can be structured to cover so that the ancillary expenses that are taxable increase and if we have gotten serious enough to create movie industry jobs and build talent pools in our state we can require film companies to use our local talent first.”
Meanwhile, Golson said she didn’t have the resources to conduct an economic impact study, but one production company suggested a film with a $10 million budget created an additional $5.3 million in related revenue when it was produced in the area.
“When we started I told [the state] you’re making 100 percent of everything, but with incentives you’re still making 65-75 percent of everything, but you’re getting a lot more of it,” Golson said. “I don’t know why they want to fight it.”
Neither Sen. Marsh nor Sen. Trip Pittman, who chairs the Finance and Taxation Education Committee could immediately respond to questions about the bill, but Hall said he’s heard it likely won’t pass during what remains of this legislative session. Yet he’s still concerned the incentives could be targeted again.
“Del Marsh was also instrumental in getting the incentives passed initially so I’m a little confused,” he said. “Let’s say we’ve had $40 million go out. That represents $160 million that has come back in… This is my dream job and my goal and I can probably get a job doing whatever. But I’m in my mid-30s and have a wife and a child and if I want to be a filmmaker I’ll go where I need to go to do it…[Incentives] are not just keeping careers in place, our entire crews’ livelihood depends on it.”