Boom May Cost Hollywood

For the most part, Hollywood’s Christmas wish list in Sacramento amounts to nothing. And that’s exactly the point.

Despite an extraordinary production boom for the last five years, and successful efforts lately by California to fend off other states seeking to steal movie, TV and commercial production, industry and state film officials warned during an Assembly hearing Monday that disincentives could be lurking.

Specifically, there is sentiment in Sacramento to view the healthy entertainment industry as a “cash cow” that could provide revenue from taxes and fees to help fund state agencies, said Patti Archuletta, director of the California Film Commission, citing one proposal to tap the industry to help fund the state Department of Parks and Recreation. Another similar issue raised at the hearing is the Los Angeles home occupation and business tax, which Hollywood writers have been fighting.

Asked what the state could do for the industry, Nick Counter, president of the Alliance of Motion Picture and Television Producers, replied: “To be perfectly blunt, leave us alone. We’re doing just fine.”

The hearing by the Assembly Select Committee on Entertainment and the Arts at the Hollywood Entertainment Museum was aimed at getting a feel for the economic impact of Hollywood as well as identifying state issues concerning the industry and its unions.

The hearing was chaired by Assembly Majority Leader Antonio Villaraigosa (D-Los Angeles), and included Assembly Speaker Pro Tem Sheila Kuehl (D-Santa Monica), who described herself as the “first sitcom actress” elected to the Assembly, a reference to her role as Zelda in the early-1960s TV show “Dobie Gillis.”

Industry and state officials provide a batch of statistics showing how extensive the production boom has been lately in Hollywood, triggered by such factors as the explosion in demand for Hollywood product overseas and on domestic broadcast and cable channels. Melissa Patack, vice president of the Motion Picture Assn. of America’s California group, said the number of hours worked this year by union members in Hollywood should total about 60 million, compared with about 40 million in 1993.

The group also noted at the hearing that while California faces competition from other states for production, it has been able to hold on to its dominant lead in market share for film production, currently at about 75%, in part because of aggressive state and local efforts to make filming easier.

Archuletta said that “what the industry basically wants is ease and access,” working with local and state film officials to make it easier to get permits and find locations for films and TV shows. She said the state is putting its inventory of film locations on an electronic database so scouts can examine potential locations from their office computers.

Cody Cluff, president of Entertainment Industry Development Corp., the agency that issues film permits in Los Angeles County, said the amount of time it takes to issue a permit has been cut from more than two days to less than two hours in 80% of the cases.

Still, there were warnings that the state can’t take for granted its natural advantage in production, especially with aggressive policies in Canada, which has made huge inroads in enticing producers of television movies to film there. Other countries, including Mexico, may soon be highly competitive with California as well.

Screen Actors Guild President Richard Masur argued that it is easy for productions to move to other areas if offered enough financial incentives, noting that Toronto and Vancouver, Canada, now have 20 to 30 productions going at any given time, all making product for the U.S. market.

“The capital that drives our industry is extremely mobile,” Masur said.