Slip due to 3.2% decrease in compensation

Hollywood scribes saw Guild-covered earnings slide 1.5% last year to $905.8 million in the first decline in five years, due to a 3.2% decrease in compensation for feature writing.

The WGA West’s annual report to its 8,000 members, which began hitting mailboxes late last week, noted that last year’s earnings figure is still higher than any other year except 2005. Be-ginning in 2002, earnings had risen by 3.8%, 4.1%, 2.2% and 5.8%.

In an indication that studios are holding the line on screenwriters, feature pay declined to $437.9 million after rising 3.9% last year. The number of writers employed on features rose by 37 to 1,935 — a 1.7% gain.

Feature writers also saw a 6% slide in residuals last year to $121.3 million — mostly from a 13% fall in video/DVD residuals to $43.5 million. Pay TV residuals declined 6% to $38.9 million.

The WGA told members that the decline in homevid residuals stemmed from “the prominence of non-Guild animated features,” noting that each would generate about $1 million in residu-als for members, and the exhaustion of film libraries into the DVD market.

The WGA made improving the DVD residuals formula the key demand in its 2004 negotiations but was unsuccessful. The Guild is stressing gaining jurisdiction over non-union work and improvement in new media platform rates in upcoming bargaining, which begins next Monday.

TV writing saw slightly brighter results as earnings held fairly steady at $464.6 million — a 0.1% hike amounting to $400,000 higher than 2005. It was the fifth all-time high in a row but the gain was miniscule compared with the previous hikes of 1.5%, 2.9%, 3.8% and 7.6%.

The WGA noted that the numbers, based on earnings reported for dues purposes, don’t fully reflect above-scale amounts paid and added that overscale writer-producer fees may have de-clined in recent years. The number of TV writers employed edged up for the third year in a row with a 0.8% gain to 3,353 — 25 higher than in 2005.

TV residuals shot up 9% to $130.7 million, thanks to an 11% gain in foreign free TV to $21 million due to a greater volume of programs released into international distribution; 17% in basic cable to $33.1 million and 30% in homevid to $13.1 million. Residuals from free TV reuse edged up 2% to $63.2 million due to gains in network overnight and daytime reuse.

The biggest gains for a group of writers came for the highest-paid 25%, who saw a 1.7% rise in earnings for those at the 75th percentile to $253,377. The Guild noted that the gain reflected a “solid” year in TV since series writer-producers tend to cluster at that level.

Earnings trends for other groups softened somewhat with the figure for the 95th percentile sliding 2.3% to $665,000; the 50th percentile was off 2.6% to $104,750; and the 25th percentile fell 1.7% to $37,777.

The report also disclosed that the WGA West’s net assets rose $1.7 million to $32.3 million and has combined total of $12.2 million in its Strike and Good & Welfare funds. The Guild’s been required under its constitution since 1992 to keep $6 million in its strike fund.

The WGA West said it generated a net surplus of $1.7 million for the fiscal year ended March 31, compared with a deficit of $202,611 in fiscal 2006. Revenues edged down to $22.3 mil-lion, down $100,000; investment income rose to $2.9 million from $1.9 million; and expenditures declined by $900,000 due to lower costs in the WGA Awards show and reduced spending on professional fees.

The union also disclosed that it determined credits last year on 322 screen projects and 3,680 TV projects.

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