Although “The Green Hornet” is set in Los Angeles, Sony Pictures execs considered shooting the pic in such states as Michigan, Massachusetts or Georgia. All offered better incentives that would keep production costs down, but location manager Mike Fantasia persuaded many of the film’s suppliers to cut costs so that lensing could remain in L.A.
“Hornet” stayed in town — representing a victory for the below-the-line community, which has begun to join forces with a variety of vendors to fight back against states like New York and Michigan, which grant lucrative incentives to create valuable film jobs.
“I told them, ‘If we keep this film in L.A. it will give work to 300 people,'” he said. “Every single one of them came back with a sharp pencil and I was able to cut 20% of my budget.”
The location manager went on to find additional savings — even securing the private office of L.A. Mayor Antonio Villaraigosa for a day of shooting rather than creating a similar interior elsewhere.
No city in the world boasts a larger and more experienced film crew base and more production resources than Los Angeles. Yet the region continues to lose work to other locations that offer a combination of cheaper labor, lower fees and aggressive tax incentives.
While California’s own year-old tax incentive program has helped level the playing field, many believe it doesn’t go far enough. But expanding those subsidies in the current economic climate seems unlikely.
Taking matters into their own hands, some workers say they are making concessions on wages, and some suppliers are reducing rates.
“In many situations people are working for less than the standard union rates,” said a unit production manager who’s handled both TV and film. “Even I work well below the standard DGA rate to stay here with my family. The tradeoff is that I get to see my little girl before she goes to school.”
While unions might be expected to object to such wage-cutting, “they’re turning their backs to the situation,” said one location manager. “Ten years ago people would have been fined for taking nonunion work. The unions still don’t support it but they know damn well that people have rent and bills to pay.”
“We live here in L.A. and nobody wants to work out of town,” said location manager Briana Burke, who just came off “Scooby- Doo! Curse of the Lake Monster,” which is going straight to Cartoon Network and DVD. The producer, Warner Premiere, normally shoots outside California to keep costs down, per Burke, but decided to try a local shoot because of the state’s 20% tax incentive, which went into effect in July 2009.
To sweeten the pill, Burke was able to get concessions from the cities of Glendale and Alhambra, which waived or reduced fire and police protection fees, and from other vendors, resulting in “many jobs saved and millions spent here, not in South Africa or Atlanta.”
The problem of runaway production was documented most recently in a report from the Milken Institute, which found that incentive programs from outside California have caused the state to lose 10,600 entertainment industry jobs, more than 25,500 related jobs, $2.4 billion in wages and $4.2 billion in economic output since 1997.
Out-of-state incentive programs have made it hard for studio production execs to justify local shoots.
“It takes a whole village to keep production in L.A.” said one. “It’s tough to fight other states’ tax breaks that range as high as 40%, which is massive. A lot of times you just need to use those incentives. Money is money.”
California’s 20% tax break “helps level the playing field,” the exec said, “but it runs out of money too soon. If they appropriate more funds you’ll see a sea change, and billions of dollars would flow back.”
Michigan has the most generous tax incentive program, offering up to 42% of qualified expenditures. New York offers up to 30%.
Some below-the-liners complain that crews and vendors are making more sacrifices than the studios to keep productions from leaving California. The corporations’ simple goal is to control expenses, and they’ll shoot where they have to in order to meet cost targets, they say. Crews, on the other hand, are motivated by life issues such as keeping their jobs. Below-the-line department heads, who sometimes travel with the production, prefer to shoot in L.A. so they can stay close to their families.
“Producers know that right now crew and facilities are hungry for work because business has been so thin in the past two years,” said one location manager. “They’re taking advantage of that and we’re ending up doing a lot of work for less money.”
This can translate to a take-it-or-leave-it attitude on the part of producers. On one recent studio production “the crew and keys were told, ‘This is the budget, see what can you do for the money,'” according to a line producer. “Almost every single one of them came in under budget. They understood. Crews know what they have to do.”
Many producers also prefer to work close to home. “When push comes to shove, L.A. is where we’d rather be,” said Gary Goetzman, who’s partnered with Tom Hanks at Playtone. The company’s most recent feature — next year’s Universal-distribbed “Larry Crowne,” which stars Hanks — was filmed in Southern California, although its HBO miniseries “The Pacific” was shot mostly in Australia.
“To shoot here you need to convince the studio to stay here even though it can save money by going elsewhere,” he said, citing such local advantages as L.A.’s depth of talent, available crews, plethora of actors and bit players, plus resources like equipment suppliers and labs. “You have to tell the studio, ‘This is how we want to do it.'”
It helps to have the clout that comes following a string of solid hits, he adds.
FilmLA, the nonprofit org that coordinates permits for on-location shoots in the L.A. region, is also helping filmmakers cut costs. Among its initiatives: working with the city to provide on-site power, sparing them the expense of leasing generators, along with parking concessions. The org is reaching out to neighborhoods to make them feel comfortable with shoots in their midst, according to prexy Paul Audley.
At the same time, producers are managing neighborhoods’ financial expectations, which means reining in “gratuities” — payments made to residents for, say, the use of a driveway for parking, a backyard patio for catering, or simply compensation for a noisy, latenight shoot.
“It’s an issue we’ve been battling for years,” said location manager John Grant, who has worked on such reality TV shows as “Fear Factor” and features like “The Majestic.” “Gratuity payments have become a sticking point for producers who end up leaving California. People got greedy, but that’s starting to change as more people realize we’re not willing to pay the exorbitant fees we did in the past.”
The studios always have a number in mind, Fantasia said. “The more you prep, the more information you get, the better the chances you’ll be able to make your movie here.”