Scout & About: Puerto Rico 2012
Film Production Capital (FPC) president Will French’s decision to open an office in Puerto Rico to service the archipelago’s burgeoning film industry this year wasn’t so inspired by the impressive size of its incentive, a 40% tax credit, as much as by the way they’re handling it.
“When most states enact these tax-incentive programs for the industry, they do it without a whole lot of intelligence,” French says. “Puerto Rico saw what the rest of the states were doing, cherry-picked what worked for them and put together something small to see if that worked,” and expanded it over time, “as opposed to coming out the gate with all guns firing and giving away too much money for not enough economic benefit.”
Dubbed Puerto Rico Production Capital, the company is a joint venture between French and entertainment attorney Antonio Sifre’s consulting outfit Production Advisory Services of Puerto Rico, which handles legal and fiscal aspects of film production on the island. The firm will provide production loans and funnel capital to Puerto Rico-based film and TV projects in conjunction with local, U.S. and international banks and lending institutions. (Sifre co-drafted both the original 1999 and current 2011 film law. He also represents corporate clients in the music, film, television and Internet industries.)
FPC has provided more than $250 million in financing to more than 100 film and television projects throughout the U.S. since late 2003, including “Runaway Jury,” “The Expendables 2” and the upcoming “Killing Them Softly” starring Brad Pitt.
French was a corporate lawyer who didn’t know much about the film industry when he started trading tax credits in Louisiana shortly after the state launched its film-incentive program. He found the pic industry to be equally ignorant about how to take advantage of tax credits. But, he says, “it didn’t take long before productions started to catch on and realize that this was a way of plugging holes in budgets and raising funds that were otherwise becoming harder to come (such as) equity and bank financing.”
Tax break stakes’ giant leap | Exotic, but still part of the USA | Film firms, financiers funnel funds for features