First News
Volume:8, Number:03
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LEISURE
THIS WEEK

Hollywood Outside of Hollywood

Thirty-two US states and dozens of foreign countries now offer tax credits or rebates, plus other benefits to lure moviemaking outside of Hollywood

| Sabrina Islam |

Hollywood has been an iconic name for movies all over the world just like Xerox is for photocopying and Microsoft is for computers. But the biggest-budget films made this summer have all the elements of Hollywood blockbusters: superheroes, pirates, and space aliens. In the truest sense though, none of them is a Hollywood movie. Despite a major effort by Los Angeles over the last two years to lure film production back to where it started, producers continue to make big-budget movies elsewhere, saying they get better tax breaks and subsidies outside of Hollywood.

As a result, the summer’s movies come from all over the globe. Warner Brothers filmed Wonder Woman and King Arthur in Britain, where the Time Warner Inc. studio owns a large production space. Twenty-First Century Fox Inc.’s movie studio chose Australia for Alien: Covenant. Walt Disney Company’s Marvel Studios rolled its cameras in Georgia for Guardians of the Galaxy Vol. 2, one of six superhero movies it has filmed near Atlanta. Twenty-five years ago, most bigbudget films were filmed primarily in Los Angeles. Since then, to lure production, locations across the United States and around the globe have begun offering tax credits or rebates of up to 40 percent of local production spending, a sizeable savings on action films that cost up to USD250 million to make. Thirty-two US states and dozens of foreign countries now offer tax credits or rebates, plus other benefits such as waivers of permit fees. Along with subsidies, the small, former Soviet country of Georgia offers another perk to filmmakers.

Sophio Bendiashvili, head of Georgia’s film rebate program, said at a conference last month hosted by the Association of Film Commissioners International, that they have many derelict, abandoned small villages or factories, which are mostly state-owned still, which can be just easily blown up. In most cases, neither studios nor the filming locations will disclose specific details of subsidies granted, but executives acknowledge that they are a key factor in deciding where to film. The economic value of subsidies for the locations offering them remains under debate. Proponents argue they attract jobs and spending that outweigh their costs, while critics say the benefits are overstated and the incentives divert taxpayer money from other needs. Some states that used to offer subsidies, including Michigan and Louisiana, have stopped doing so or pared them back substantially.

Still, California decided in 2014 to sweeten its own subsidies in an attempt to lure production back. The results have been mixed. Many more television shows are now being filmed in the state, but it still struggles to attract the mega-budget action movies that hit screens from May through the US Labor Day holiday in early September.

One of Hollywood’s biggest stars, actor and producer Dwayne Johnson, moved his HBO TV series Ballers from Miami to the Los Angeles area after securing a California tax break. Johnson said he would like to film his big movies there, too. Johnson’s upcoming movie for Paramount Pictures, a remake of the TV show Baywatch about California lifeguards, was filmed on Tybee Island, Georgia in the United States, with help from tax credits. Hollywood used to have a firm grip on film production because of its infrastructure, which includes numerous sound stages as well as specialized equipment and a large network of experienced crew members, actors, and extras. Increasingly, other locations such as the state of Georgia are offering good production facilities and trained personnel, though producing outside Los Angeles still often requires flying in some key workers.

California offers a 20 percent credit for feature films, applicable to USD100 million in spending. Some costs receive an additional 5 percent. The state does not apply the credit toward one large chunk of movie budgets — the salaries of actors, directors, and producers — as other locations do. Since raising the subsidies, Hollywood has landed two forthcoming big-budget films. Disney’s adaptation of children’s book A Wrinkle in Time received an USD18 million credit for USD85 million in spending, and an untitled Paramount release was awarded USD22 million for USD102 million in spending. Some film officials in California say the increase in television and middle-budget film production is evidence the higher subsidies have been effective. The incentives have brought 11 TV series back to the state since 2015.

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