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Supporters of film industry rally downtown

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WILMINGTON, NC (WWAY) -- With only two days notice, supporters of Wilmington's film industry attracted thousands of people downtown to rally against possible changes in the state's film incentives.

A bill, co-sponsored by two local lawmakers, Rep. Rick Catlin (R-20th District) and Rep. Chris Millis (R-16th District), has folks concerned about the future of the industry. It would stop the refundable portion of the state's film tax credit, potentially pushing big productions like "Iron Man 3" away from Hollywood East.

"It would make sense that people who live in this community, that they should be able to plainly see the benefits of the film industry and the number of people who work in the film industry," Screen Gems Executive Vice President Bill Vassar said.

Supporters say it is an industry that provides Wilmington with jobs and revenue, and a bill that would leave Wilmingtonians jobless.

"I'm a talent agent," said Susan Walters of STW Talent. "I represent about 250 actors here in the Wilmington area. That is a lot of jobs that would be lost. Not to mention my own."

Local leaders, including Rep. Ted Davis (R-19th District) and Sen. Thom Goolsby (R-9th District), were at the rally. They say it is important to educate those in Raleigh, and that they will keep fighting for the film industry.

Disclaimer: Comments posted on this, or any story are opinions of those people posting them, and not the views or opinions of WWAY NewsChannel 3, its management or employees. You can view our comment policy here.

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Here's a radical thought

I toss this out as food for thought.
If NC locations were used
If NC peoples worked behind the scenes on lighting, set building etc etc etc.
If NC people were used in lower echelon filming as extras......

Why not charge the distributor of the film a tax on the profits as tax for NC?

For incentives that imply permanency the state of NC continuously collects income taxes, and sales taxes on those incentive caused jobs well after the incentives were paid out.

Here on the subject of film.
We issue a tax credit after the $ are spent.

Then the film goes on to make MILLIONS of dollars when they used our scenery, our technology, our people.
Our people are now unemployed but the big name actors and the studios reap MILLIONS in profits off of us.
It would seem only fair to charge a NC tax on profits derived from filming here, while using NC labor to do so. NC still collects revenues from Verizon and PPD employees ??????

Vog

Here's how it works:

NC crew, cast, caterers, actors, restaurants, frame shops, lumber yards, paint stores, car rental agencies, florists, antique stores, fabric shops, hardware stores, hotels, etc. etc. were EMPLOYED AND MADE MONEY from the film industry. The film industry pays full sales tax as well as payroll tax and unemployment insurance. We local crew also pay income, sales, property tax as well.

And you propose to tax them further rather than giving a 25% rebate on the tax they've already spent?

"Our" people are not unemployed as long as the film productions continue to come in. When the area hosts 3-4 shows going on at a time, as it is now, I'd bet the local crew is experiencing full employment. In fact, we could really use a few more people in certain departments: carpenters, painters, set dressers, lighting electricians and grips are almost always in short supply when it's busy in the Wilmington area.

(Funny how you mention PPD. They received incentives from the county and city to relocate downtown. Soon afterwards, Fred Eshelman sold to a German company that laid off local workers. Did the city or county get any refund then?)

About PPD

PPD headquarters have always been within the city limits of Wilmington. They started out on Front Street and have come back there. And as far as I know, both The Carlyle Group and Hellman & Friedman are American formed companies that bought PPD and made it a private company.

Ignorance vs. educated

It's very easy to tell the informed commenters vs. the uninformed ones on this issue.

Fortunately, the Speaker of the House, Thom Tillis has relegated this pitiful bill to the Rules Committee where it will simply wither away. The best thing that has occurred because of Reps. Catlin's and Millis's attempt to kill the film incentives is that our community of crew, business owners and political leaders have formed a cohesive unit that knows how beneficial the film industry is to the state's economy, and WILL defeat any move to drive it to another state.

Those that hate the film industry so much might want to ponder living with Titan Cement and mercury poisoning as an alternative to the clean, well-paying jobs film/TV bring to the area.

Why Rally

in Wilmington?

The legislature is in Raleigh. The vote will be taken in Raleigh.

That's where an organized rally should be held. Of course, that would require supporters to drive 2 hours up I-40 and 2 hours back.

Correct Tom, BUT.......

In a representative republic we can demonstrate here to show our representatives how we feel and they should vote accordingly.
You seem to think that effort indicates tenacity - perhaps you are right - but given that speech is free and our government is set-up the way it is then it should follow that a demonstration at home is just as effective as demonstrating in Raleigh.
Now, that being said - we hit the real crux of the problem - the tax credit causes a hit to the general fund through either out right payments or reduced revenue collection. This fund includes payroll taxes paid by all North Carolinians - sales taxes paid by all North Carolinians and so on.
Do they want to see a portion of their tax dollars used to support an industry that does not affect 99% of them, their districts or their counties? How often has a movie been filmed in say, Tarheel? Or perhaps Cerro gordo?
Incentives are troubling because they are handed out by politicians for the benefit of a specific company who's impact is limited to a small area.
On the grand scale SC is now talking about increasing the tax credit from 10% to 20% and reducing the corporate tax further.
So the movie makers got what they wanted. They have succeeded in pitting NC against SC and before you know it we will be paying them, as opposed to reducing their taxes, to film here.

McCrory and Legislature went down the slippery slope with MetLife now the film industry is piling on and other states are joining in.
A very big and soon to be costly mistake IMHO

Vog

NC is already paying them cash

The credits are already paid out as cash. The state literally cuts a check. When the program was modified in 2009/10, the NC film office even advertised them as such: "cash". Spend $1 million, the taxpayers handout $250,000 to a shell production company that doesn't owe or pay income taxes in NC. And you thought it was bad already! ;)

VOG

I've never been in favor of government incentives, whether tax credits or outright cash, by North Carolina. That's especially true given the state's current economic condition.

But, if the elected officials are bound and determined to dole out state funds or tax credits, it makes more sense to do it for jobs which will be permanenet and not short term.

Yep I agree

Permanent jobs are far better for NC then temporary ones are.
With permanent jobs the accumulated income taxes collected far outweigh the incentives given over time.
I also agree with a previous post you made that incentive supporters have done a terrible job showing or proving their economic impact point.

But here is a thought for you. Everyone talks about how the movie industry impacts this area and the ballpark situation got me to researching this "multiplier affect" as used by IMPLAN which is the basis of all the economic impact statements made here and during the ballpark debate.
If memory serves me correctly - the multipliers are only effectively used for permanent jobs.

Supporters of incentives are using WAG's as to the true impact that a film production would have on this area.
And while it is a clean industry - that is not the debate here.
Verizon is clean - PPD is clean - both received incentives from the city or county.
But those two company's have now caused MILLIONS of dollars in total revenues to go into city, county and state coffers from income, property and sales taxes paid by them and the employees working there, permanently living here, and shopping here.

But the main source of profit for the film industry are royalties paid AFTER the movie has been made - which goes to into a very small number of "pockets" and typically does not include anyone here in NC.
Their impact seems to be much smaller - but because it's clean and because it's considered artistic and because there might be a mega star possibly coming to the Port City from time to time we go all "gaga" over this industry.
I harken back to a statement I made previously:
"So the movie makers got what they wanted. They have succeeded in pitting NC against SC and before you know it we will be paying them, as opposed to reducing their taxes, to film here."
Add to NC and SC, CA, GA, and LS - and I would have to say the movie industry is extorting money from the states.........

Vog

Instead of subsidizing the

Instead of subsidizing the film industry with my money, let me keep it. Then, I'll spend it on the movies I like.

A billion in incentives for

A billion in incentives for less than 1000 transient jobs? All for film industry folks who go on unemployment between film productions? Ya'know, I want to understand it, but I just can't wrap my head around it...

I don't know how fair the

I don't know how fair the assumption is that they go on unemployment between jobs. The people I know in the industry budget their money and make out fine on what they make.

Justin, my curiosity is

Justin, my curiosity is piqued. Where did you find the incentives to be a billion (that's a thousand million) dollars and 1,000 jobs published?

Goolsby and Davis are

Goolsby and Davis are sell-outs, not truly principled.

Thank goodness we have people like Millis and Caitlin who will work for the good of all people no matter where they live!

Please educate yourselves!

Without even understanding how the film incentive works, folks are spewing rhetoric about "subsidizing Hollywood fat cats" when it is the LOCAL crew and businesses that are the most directly affected by the film tax REBATE. No taxpayer money is spent at all! The money is spent by film production companies and they all pay 7% sales tax, payroll taxes, etc. ONLY after the money has been spent in the state is there a refund of 18% (since the 7% in sales tax doesn't come back!). It's a bargain compared to the jobs that would be lost and businesses that would shut their doors without them.

Lordy, fortunately the educated people get it and support our clean, well-paying, highly visible, positive industry.

Too bad two of the local politicians don't.

If you could just climb down from your elitest Olympus

for a moment to educate educate a poor serf like myself, perhaps you could explain how "No taxpayer money is spent at all!" If the production company has no tax liability, and NC gives them 18% in cash for their expenses, how is it no taxpayer money is spent?

In order for that to happen, the taxes collected from ancillary businesses directly linked to the production would have to exceed, or at least equal the 18% payout from the state.

To date, I have seen exactly zero numbers to support either position. Perhaps you could provide some elucidation of a substantive empirical (not conjectural) nature to support your position.

This would be a golden opportunity for you to help the rest of us poor "uneducated" slobs.

(Of course, a "no response" or a "conjectual response" from you would possibly undermine your elitist post, so let's see some real numbers.)

The NC Department of Revenue

The NC Department of Revenue does publish film incentive statistics. For the 2011 year, the latest, you will find it here: http://www.dor.state.nc.us/publications/incentives/2012/film_production_...

Reports from 2007 are linked here at the NC Film Office: http://www.ncfilm.com/incentive-reports.html

The total spending reported for 2011 was $121,379,192. It further reports that 10,588 people were employed that year and the cost of these credits was $30,344,798. Quickly dividing the cost of credits by the number of people employed yields a cost per job of $2,865.96.

Note that all of these payments ARE subject to NC sales and income taxes, EVEN the wages paid to those residing out of state.

This report does NOT delineate between payments made to in-state vs out-of-state business and workers, thus a complete assessment of the economic benefits cannot be derived from this information.

The minimum benefit would be the tax revenue realized by the State of NC on the income earned by the non-residents (both persons and businesses).

When resident earnings are considered, the individuals being paid are paying state taxes AND are spending in the state's economy.

The impact of earning and spending is subject to a multiplier effect. Though this article is British, it succinctly explains the principle of how a dollar spent in an economy creates additional income. http://www.economicsonline.co.uk/Managing_the_economy/The_multiplier_eff...

Guest 1492, I intuitively believe that the film incentives are a benefit to this state but I am surprised that the large beneficiary industry leaders aren't providing more "facts and figures" in support of their incentive program.

When we think of a proposed $100Million incentive to place 2600 jobs in the state by MetLife, dividing that through yields a cost per job of $38,461.53. This is quite a striking difference from the cost per job of the film incentive program.

Something else to think about, the current incentive program has a $1Million cap on the wages and salaries paid to an individual. This limit all but precludes the possibility of a project with A-List talent situating itself here in NC.

10,000 jobs? Um, no...not full time equivilent.

Look at the 2012 report from revenue again. One Tree Hill accounts for 5,057 of those "jobs" and Eastbound & Down another 2,105. Actual full-time crew & cast jobs on those shows is closer to 300. In short, they counted all the extras used and probably counted each crew job 1 time for every episode. Based on the spending, the 600 jobs for Hick also looks very inflated, but let's go with it.

That would bring the total jobs closer to 4,000. Further complicating things is that the reports don't list how many are NC resident and how many out of state. The impact report for Iron Man 3 showed that 73% of all wages went to non-residents. Even more wages were paid to out of state BTL than NC resident BTL. Finally, you would need to convert the positions to full-time equivalent jobs.

All we need to do is look at the total wages paid ($66.8 million) and divide it by jobs (10,588). That would mean just $6,300 wages paid per worker. Isn't the annual average wage closer to $60,000, if not more? Because at $60,000 average salary, that's barely over 1,100 jobs ($60k divided by $66.8 million).

Thanks for putting it out there

I've read through the film incentive stuff myself. I agree with a lot of what you've said. I thought a couple of things you tried to compare were a little bit apple and orange; the MetLife thing in particular. The MetLife jobs are full time. All films jobs are part time and then done. There were a few other things but I really don't think this post is the proper place to try to do line item details.

One thing I think we both totally agree on is that for some mysterious reason neither the State or the film industry has been forthwith in really providing the details necessary to make an intelligent decision. That just sucks eggs.

Thanks for responding.

I wonder

Why Catlin did this KNOWING it would get shelved?
Vog

filming

I was ther yesterday and found it interesting that the majority of speakers were politicians. No-one from ScreenGems had anything to say. Also absent were any speakers from any unions. Wonder where they are? Are they comfortable that no changes will be made? Or are thay already looking at other states? Also very disipointed that no Police or Firefighters were out there - on a movie set they can make - in one day what they would make in 4 or 5 days with the city. disipointed - CC

Hollywood Greed

It's high time we give Hollywood the cold shoulder.

Tax experts agree that Hollywood tax credits are not worth the money because the economic benefits created by these productions are small and fleeting.

The Movies and Movie Makers made more money last year than ever, yet they still want the state to write them a blank check.

Hollywood should be ashamed. Major actors, directors, and producers send their money to foreign countries just so they don’t have to pay any taxes. Hollywood takes the liberty to take money from a wide population of taxpayers who will never benefit from the industry filming here. And to top if all off, most of what Hollywood produces is lowbrow trash.

I do not want one penny of my tax money to go to Hollywood trash purveyors.

Rally for NC Film

If you were at the rally you would know that Bill Vasser - VP @ Screen Gems - did speak. He started out the rally and introduced Safo after a statement. The last speaker was Tim Bourne a producer & assistant director in the industry. He spoke for the crew, the unions - he's a member of the DGA (Director's Guild of America.)
As far as the other comments: get your facts straight. The millions poured into the local and state economy from film are easy money. Nothing is torn down, forests aren't destroyed, the air isn't polluted, the wages are very good.
Those in attendance were majority film crew: camera operators, grips, electricians, locations, assistant directors, assistants. All well paid and all very skilled at their crafts.
The simple explanation of how the incentive works: a production comes in. Spends money - minimum of $250k - for the production. Once the shoot is complete and the money has already been spent - let me repeat that: already been spent - the state audits the productions expenses and verifies the amounts and the validity of the expenses. Once the audit is done, the state issues a tax credit for 25% of what was spent - again, of what was spent. If there is no tax liability a refund check is then drafted. Since the money has to be spent first, the money is already there. The money doesn't take funds from other areas of the budget. Remove film from NC and the amount of money locally and statewide these productions bring in will be noticed. Remove film and 1500+ people who work on the industry will have to move. Taking their incomes and their taxes with them.
The film incentive requires $$ to be spent first. How did the Dell incentive work out for us? Oh yeah, they never came...

So you're saying ....

that if there is no tax liability, which is often the case, the State of NC picks up the tab for 25% of the production company's expenses for those items that company used to make a profit on their film. Profits that go elsewhere.

You may or may not be right on the bottom line of ultimate gain to NC, however, that can only really be determined by shining a little sunshine onto this whole process and really crunching the numbers. So far, that really hasn't been done.

Curiously enough, I don't really see the film industry crying out to do that. With all of their creative accounting, one would have thought they would have by now. What I do see is a massive amount of publicity relations energy being expended instead.

Why is that?

"Two local lawmakers"!

WWAY needs to state their names, so their constituents know who is trying to kill jobs and a thriving film industry:

REP. RICK CATLIN (R-NEW HANOVER)

REP. CHRIS MILLIS (R-PENDER)

SHAME on you both! And kudos to the two Republicans, Davis and Goolsby who understand the benefits of having a clean, well-paying, high-profile industry in our state!

Jobs? The well paying ones go to those from out of state

Yes, the movie industry provides jobs. However, most of the money is paid to people and companies from out of state. The red and white trucks at EVERY production - Georgia. Talent,and technical? Not from here. They rent long enough to get through the production, but they are residents of California, New York, or states with no state income tax like Florida. Catering? Paid to companies that are from out of state. Just look at all the license plates when they block off half of downtown - for free.

Lots of OT for fire and police - which is a good thing, since they really need it, AND they live here. Extras? At little as they can pay - and - I'm sure all the extras here locally are claiming their pay as income, and paying SS and other taxes? Yeah, OK.

These productions have NO ties to Wilmington, and as an example, even if that "no power" show gets renewed next season, they are done with Wilmington. So much for how much "they love Wilmington".

And... for those that think promoting this bill is just the Republicans, it's not. There's six dems on that bill too.

The majority of the film

The majority of the film crews on any given show in NC are NC residents. ALL of the crew at the rally Sat are NC residents. The average hourly rate for a NC crew member is around $24/ hour with time and a half after 8 hours and dbl time after 12. Extras are paid $8/ hr (it's a really no skill involved job) with time and half after 8, double time after 12. Is McDonalds or Wal Mart paying that way? Specialty extras (horseback riding, dancing, specific ethnicity, skill) get paid more. Production Assistants - the lowest rung on the crew make $150/ day. Most PAs move into other departments where they make the above mentioned hourly rates. Assistant Directors start at $2700/ week - assistant directors spend 2-4 years as PAs and learn/ hone their craft.
Yes, most shows will bring in the 1st Assistant Director, production designer, and a few other key creative crew types. On average that's around 10-15 people. The other 135 or so crew members employed on the productions are Wilmington area residents - your friends and neighbors, parents to your kid(s)' friends.
Yes, Lightnin' is from Georgia. But the drivers of those trucks are from NC. The grip and electric equipment is rented from Screen Gems or Cine Partners here in Wilmington or from Hollywood Rentals out of Charlotte. Cinema Catering, Ken & Arts & Reel Cuisine are based out of Wilmington, owned by local residents.
Do you complain when the Azalea Festival, Riverfest, Rims on the River, MLK Parade or other city events close multiple blocks for their events? That's lots of parking that's not being paid for. The city controls how much parking we are allowed to have for our trucks when filming downtown. I can assure you we will never be allowed to have the same amount as those festivals. We also pay for some of the on-street parking and when we use the lots and decks we pay for every space we use.
The film industry is a vital part of Wilmington and the rest of the state. It's worth fighting for.
I am an Assistant Director and a Location Manager/ Assistant Location Manager in the business. I live here in Wilmington, own a home and my daughter goes to school here.

Louisiana Debate on Film Incentives

Elections have consequences

This is what you get when you elect a canididate who is always looking towards the next level. Rick Catlin is to busy auditioning for a gubernatorial or congressional run to remember who voted him into office. Boy he called Berger a boob, look in the mirror pal!

Wake Up

994 is about keeping my tax dollars and yours in NC where they belong. Why can't anyone understand this? Why are we happy about sending millions of tax dollars to Hollywwod when we ought to be paying our teachers and improving our schools. About 90% of the rally gathering were unemployed extras. I bet they do hate to see the movies go...they might have to get a real job.