Film Commissioner Touts Fledgling Incentive Program

March 17, 2014 | By More

OURAY – Colorado Film Commissioner Donald Zuckerman met with local elected officials and members of the business community in Ouray last Friday to discuss the importance of film, television and media production in Colorado, and how to responsibly encourage film production.

Towns like Ouray and Ridgway, with their authentic small-town character and spectacular scenery, may be off the beaten path, but have a lot to offer to the film industry, Zuckerman said.

“The key is, you have got to make yourself known to these people so when they are thinking of where to go, they think of this area,” said Zuckerman, who is himself a former movie producer.

Colorado has been attracting more and more film and television projects over the past two years, thanks to its fledgling film incentive program, created through the passage of House Bill 1286 in 2012.

The program is administered by the Office of Film Television & Media, formerly the Colorado Film Commission, now a division of the Colorado Office of Economic Development and International Trade. It offers a 20 percent cash rebate for production costs taking place in the state, including film projects, television pilots, television series (broadcast and cable), television commercials, music videos, industrials, documentaries, video game design and creation, and other forms of content creation.

An additional component of the program is a loan guarantee program with the state guaranteeing up to 20 percent of a production budget.

One condition placed on production companies that accept an incentive in Colorado is that they must hire at least 50 percent local crew. Ideally, this is a win-win scenario for the host community and the visiting production company.

“To the extent that local people exist who know how to do the job, [the production company] saves money,” Zuckerman said, by not having to pay living expenses for 100 percent of its crew on location.

Local economies, meanwhile, benefit from an infusion of cash in the lodging and dining sectors, and new jobs for locals ranging from construction to catering.

Colorado’s incentive program is modest compared to those of other states. New Mexico, Utah and Georgia all offer rebates in the 25-30 percent range, for example, while Michigan and Alaska offer rebates of over 40 percent.

But still, the program appears to be successful – so much so that the $3 million in seed money that the Colorado legislature put into the fledgling program in July 2012 has already been exhausted with months to go before the conclusion of the two-year inaugural funding period.

Now, Zuckerman said, he is in the difficult position of having to turn away projects that could have been incentivized, had there been more money in the pot. “The phone rings every day,” he said. “The first year, the phone never rang. But now, we are turning business away because we are out of money.”

Hopefully, that money will be coming soon. Gov. Hickenlooper included $5 million in his 2014 budget to recharge the film incentive program, but it is ultimately up to the state legislature to decide whether program gets funded. The Joint Budget Committee takes up the matter within the next few weeks.

“It is important not to be complacent and assume that we are going to get it,” Zuckerman said. “It is not up to me. It is up to the legislature to decide if this is a worthwhile program.”

Critics of Colorado’s film incentive program have argued that the incentives cost more than the state is getting back in money spent in the state by production companies. But Zuckerman cited a recent Leeds School of Business study that showed a “better than revenue-neutral” scenario where Colorado’s film incentives are concerned.

Even as a revenue-neutral program, he said, the multiplier effect of having films, commercials and TV programs located in Colorado could be felt for years to come.

“There was a study recently done in Florida that showed one in four tourists said they came to Florida because they saw in it in a movie or TV show,” he said. “Why should it be any different here?”

Without an incentive program, Zuckerman argued, the production companies simply wouldn’t come.

In some cases, they came, but then slipped through the net when they learned that Colorado’s incentive program is not as robust as those in competing states (or countries), or that the incentives may not be reliably funded from one year to the next. That’s what happened last summer, when producers of Hallmark’s new series “When Calls the Heart” were on the brink of shooting the show in Telluride, but pulled out at the last minute and decided to relocate in Canada.

“The producers finally figured out we couldn’t promise them money for the following year, and they were trying to get more incentive money in the first year,” Zuckerman said. “Basically, they were demanding it and we couldn’t do it.”

It’s a mar on an otherwise impressive record. Projects that have been incentivized through the Office of Film Television & Media so far include two feature films – “Dear Eleanor,” produced by Leonardo De Caprio’s production company Apian Way, and a small, locally produced film called “The Frame”– with three other film projects in the works.

A number of commercials and TV productions have also been lured to Colorado, including “The Prospectors,” (the number-one show on the Weather Channel), and Universal Sports’ series, “The Road to Sochi”, a program that profiled Colorado’s Olympic-bound athletes.

Zuckerman’s office has also incentivized two series on Rocky Mountain PBS that he says “likely would not have been made without the program.”

TV shows and film projects may be glamorous, but confessed Zuckerman, television commercials are really where it’s at in terms of a quick economic shot in the arm to the host community.

“The commercial business is a great business,” he said. “Commercials will pay whatever you ask. It’s a whole different mindset. They tend to overpay for everything.”

Zuckerman suggested that counties and municipalities that wish to lure more commercial production houses, as well as movie and TV producers, to their area should pro-actively develop regulations and permitting processes that are quick and easy to comply with, so producers can hit the ground running.

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