Florida’s entertainment industry fights for flailing tax-incentive program

When more than 2 million people tuned in to watch the new HBO show Ballers — a darkly comical drama starring Dwayne The Rock Johnson about retired NFL players — South Florida once again took center stage on TV screens around the world as a glitzy, sprawling playground with a propensity for crazy, only-in-Miami stories.

The series may also be the last in the foreseeable future to double as a worldwide billboard for Florida, the way Miami Vice did in the 1980s. Last month, Florida legislators voted not to extend the depleted state film-and-entertainment tax incentive that has run out of funds with a requested $10-$20 million. A new incentive program may be considered in 2016.

Legislators also voted to cut the staff of the Florida Office of Film and Entertainment in half. Insiders worry that that move may signal waning interest in using funds to continue luring out-of-state productions to Florida. As production dwindles, existing media content providers and technical crew

appear to be relocating — further eroding the regions ability to compete.

I think its short-sighted, said Steve Payne, the vice president for corporate communications for Feld Entertainment. This isnt an expense, its an investment. Payne said the lack of incentives probably wont have much immediate impact on Feld, because its emphasis is on live entertainment. Feld studios in Ellenton have space that can be used for sound stage, and experts in everything from sound and lighting to sets and costuming, so a lack of incentives could discourage filmmakers from using Feld facilities in the future.

Theyll go to where the best business environment is, Payne said.

Deborah Miehls, the film commissioner with the Bradenton Area Convention and Visitors Bureau, said its too early to gauge what effect the lack on incentives might have on this area. But it could be significant. Across the board, from small independent films to the major Hollywood productions, they depend on these incentives, she said. If a major Hollywood movie films here or a TV series films here, Miehls said, it means that scores of people come to area for months at a time, staying in local hotels, buying from local retailers, eating in local restaurants. And it means that locals actors and technicians get extra work. Besides, she said, a movie thats filmed in Bradenton can serve as a advertisement for the city, because filmmakers usually want to make whatever location theyre filming in look beautiful. Major productions most often come out of California or New York, Miehls said, so they have to travel a long distance to come to Florida. They can save huge sums of money simply filming somewhere closer. Louisiana, she said, has been aggressively courting filmmakers with various incentives. Even if theyre doing a film thats set in Florida, she said, they might be able to save so much that they can make Louisiana look like Florida.

According to Graham Winick, film and event production manager for the city of Miami Beach and former president of Film Florida, a nonprofit group that assists the film, TV, commercial and media industries, at least three recent high-profile Hollywood studio productions opted to shoot mostly exteriors in South Florida, then fled to other states to complete filming. Those included Ride Along 2, starring Kevin Hart and Ice Cube; Arms and the Dudes, with Jonah Hill and Miles Teller; and Alvin and the Chipmunks: The Road Chip, the fourth installment in the popular family film franchise.

We got two weeks instead of two months with those movies, said Winick. We lost the (upcoming TV series) Rosewood from Fox (starring Morris Chestnut as a Miami pathologist) to LA We lost an NBC show called The Fuentes Sisters that is going to Puerto Rico now. The Cocaine Cowboys series is finally proceeding with TNT, but it could also go to Puerto Rico. Bloodline (the Netflix series set in the Keys) is coming back for season two, but this industry weve been building for 40 years is going to go away unless we do something now.

In 2006, Florida was ranked third in the United States — after California and New York — in the number of film productions shot in-state. That was thanks to a slew of big-budget films made here in the 1990s, including True Lies, Theres Something About Mary, The Birdcage and Bad Boys. But after studios started heading north and to other countries with favorable exchange rates, such as Canada, states began offering incentives to lure them back. In the arsenal were tax credits, rebates, grants and sales-tax exemptions.

Florida joined the fray in 2010, allotting nearly $300 million for film, TV and video production in tax credits that were redeemable only after production had wrapped. Sixty percent of the cast and crew of any given production also was required to come from Florida.

The program was supposed to last five years, but there were so many takers that the funds were tapped out in three. Still, hits such as Dolphins Tale, Burn Notice, Spring Breakers and Pain and Gain provided steady job opportunities throughout the state.

Despite the success, many states downsized or eliminated their incentive programs altogether. In 2014, an attempt to replenish the incentives funds was denied by both the Florida Senate and the House. Following last months failure to once again revitalize the program, proponents must now wait until 2016.

Its impossible to know how many productions have turned elsewhere or to calculate the financial loss. But the 1950s-era crime drama Magic City shot in Miami for two seasons gives a clue. Said series creator Mitch Glazer, In the two years we spent shooting the TV series there, we spent over $100 million (including converting the former Bertram Yacht factory into a working studio) and hired 300 cast and crew members, most of them local.

We didnt spend a dollar outside South Florida. If it hadnt been for the incentive, we would have just grabbed a week of exteriors and shot elsewhere.

Glazer, a Miami native, is now preparing to direct a feature film based on the series.

We are filming in Miami in spite of Floridas efforts, he said. My financiers were pushing me to film in Louisiana or Georgia or Puerto Rico, and the movie would have been done last month and we would be editing. But Miami represents the glamor of the city that I want to write about. In this case, I couldnt just go where the incentives were.

Glazer says the Magic City movie will reunite the shows original cast and throw in Bill Murray (as the head of the CIA) and Bruce Willis (as a Chicago mobster). Glazer even offered to have Murray and Willis film public service announcements for Floridas tourism board for free. But although Magic City is now viewable by 70 million people around the world via Netflix, the state wouldnt budge when it came to a tax break.

Rolando Aedo, the executive vice president and chief marketing officer for the Greater Miami Convention and Visitors Bureau, admits that part of the difficulty in convincing legislators of the value of tax incentives is that the residual benefits to the state are hard to pinpoint.

The producers of 2012s Rock of Ages, a film adaptation of the Broadway hit starring Tom Cruise, settled on South Florida to stand in for 1980s LA, in large part due to the $8 million tax rebate granted by the state. But its difficult to say exactly how much of the films $75 million budget was spent on local services ranging from dry-cleaning to lumber yards to Publix and Costco runs.

The main hurdle for the tax incentive is that you are dealing with a generally conservative Legislature — both Democrat and Republican — that is philosophically opposed to incentives, Aedo said. When they receive a report on the return on their investments under the current program, those numbers dont include intangibles such as tourism.

Nor does it take into account the value of perception. After Time magazine ran the infamous Paradise Lost cover about Florida in 1981, civic leaders faced the daunting job of first fixing the regions problems and then repairing its image — an effort that would have cost millions. Miami Vice, which premiered in 1984, created the fix — and brought production dollars into the community, as well.

The show made us look cooler than we were at that time. We grew into that image, said Aedo. The classic scene set to Phil Collins In the Air Tonight was a quintessential moment. South Beach went from being Gods waiting room to the epicenter of cool and hip. Film and TV production really is that powerful. And its not tourism, either. It can also lure other businesses.

The loss of tax incentives also impacts local companies. Luis Silberwasser, president of Telemundo Network, the largest producer of Spanish-language prime-time TV content in the US, expressed disappointment at the decision not to extend the tax-incentive fund. Currently, Miami is home to ten Telemundo studio facilities and employs 800.

As the largest producer of Spanish-language prime-time content in the US, the film incentive plays a critical role in our short- and long-term decisions, he said. Not having a multi-year incentive directly affects our cost of doing business and puts us at a competitive disadvantage. Florida is positioned to be one of the leading production centers in the world, and funding the film incentive would have created thousands of new jobs for Floridians.

Pieter A. Bockweg, executive director of the Omni-Midtown Community Redevelopment Agency, is gambling on that growth. Due to open this fall is the Florida Film amp;amp;amp; TV Center at 50 NW 14th St., a 70,000-square-foot studio facility with two massive sound stages, as well as extensive office space and editing suites. Bockweg hopes to help further the revitalization of the slum-blighted Omni district by creating jobs and incentivizing area businesses to work with productions that make use of the studio.

But Bockweg also says that the studio, which cost $14.5 million (paid for primarily by city and county tax funds), will also be an economic boon for the state — and the state tax incentive will play a critical role. The company hired to operate it, EUE/Screen Gems, runs similar facilities in Georgia and North Carolina.

Tax incentives are an integral part of attracting film and TV and any other form of entertainment to come to Florida, Bockweg said. I look at them as one piece of a pie. You need talent, you need locations, you need facilities, you need tax incentives. This building is not just for the city of Miami. It impacts the entire state.

The Florida Film amp;amp;amp; TV Center may help stem the growing trend of filmmakers, actors and crews abandoning Florida, lured by steady work in states with more generous tax incentives, such as Georgia (where Captain America: Civil War is being shot) or Louisiana (which spent a whopping $251 million on film tax credits in 2013).

Lucas Leyva, a co-founder of the Borscht Film Festival and tireless proponent of growing and nurturing the Miami filmmaking scene, says the battle is getting harder. After filming a series of short Web episodes about only-in-Miami stories called No Seasons for MTVs online channel MTVOther, he and co-creator Jillian Mayer have been approached by Time-Warner to shoot a pilot for a possible TV version of the show.

We fight so hard to make everything we do in Miami, and its hard to tell these corporations to pay 30 percent more in order to shoot it in Florida, said Leyva. Its hard enough to convince people that making things in Miami is worth it #x85; If we went to California, we would be saving a lot of money.

With the incentives gone, experienced crew members are moving away, says Leyva. Miami-born actor Carlos Gomez, who appeared in all four seasons of Aamp;amp;amp;Es crime-drama The Glades shot in South Florida from 2010-2013, sees the same.

When we shot The Glades, a lot of the people who worked on that show had also worked on Miami Vice. We employed over 150 local people daily, and the show was a big hit overseas, he said. When the tax incentive started, everyone wanted to shoot there. But now everyone is leaving. Its a shame. It feels like theyd rather build another 40-story condo than to grow the film industry.

Despite the bleak outlook, supporters of the tax incentive arent giving up. They plan to introduce a revamped version in the 2016 legislative session that gives an edge to the television and video-game industries, because they have the biggest and most stable employment ratio.

If the Legislature acts when it reconvenes in January, the state would be in line for the February 2016 pilot season, when production companies start to shoot the first episodes of shows they hope to sell to networks as series.

Michelle Hillery, the current president of Film Florida, says she plans to discuss the urgent measures needed to preserve the incentive program during the groups annual meeting, which runs through June 30 in St. Augustine.

We all need to visit our legislators in their home offices over the summer months and let them know what they must do to protect this important industry, or it will be too late to save, she stated via the groups email newsletter. This has never been about a handout to Hollywood productions — its about supporting the hard-working Floridians and businesses who have made Florida their home.

Sandy Lighterman, commissioner of the Miami-Dade Office of Film Entertainment, says she is cautiously hopeful.

If the incentive goes away, TV series like Ballers would move out-of-state, she said. If we want this industry in this state, we have to stay in the game. Its just like the airline industry or the orange juice industry. The only difference is that it is a factory of content creation. And we will continue to make noise until the last person leaves.

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