Work in music scoring in Los Angeles has plunged 68% to $15.5 million in 2013 from nearly $50 million in 1998, a new report shows.
“Employment is in sharp decline,” said the “Keeping the Score” report by the Los Angeles Alliance for a New Economy. “Over the past decade, the loss of scoring work has cost the region $280 million despite enormous subsidies paid to production companies in the form of federal, state and local incentives meant to generate quality employment. Outsourcing may also be costing the federal government in taxes the industry fails to pay as it profits by shifting work overseas.”
Study author Jon Zerolnick asserted that as studios are sending more recording work overseas, they are also accepting billions of dollars in tax breaks explicitly intended for job creation and protection.
The report blasts Lionsgate for chasing after U.S. tax credits while shifting scoring work to lower-cost locales such as Macedonia. “By off shoring music scoring, production companies save less than one-quarter of one percent of a film’s production budget, yet, on a typical film, working musicians and the local economy lose $1.2 million,” Zerolnick said.
The report also noted that the Los Angeles City Council voted recently to extend a five-year fee waiver for filming on city-owned property and that Gov. Jerry Brown signed legislation in September to increase annual tax credits from $100 million to $330 million.
“By bringing recording work in Southern California back to its 2000 level, we have the potential to inject $37.5 million into the regional economy every year, and to protect critical infrastructure,” Zerolnick said.
Musicians have noted that studios may be moving outside the U.S. due to the requirement for 1% of video revenues that companies have to pay members of the American Federation of Musicians. Those monies aren’t paid for orchestra work outside the U.S.
The report recommended that state tax credits require domestic score recording.
“With so many states offering billions of dollars in tax credits, it would be easy for policy makers to attach recording conditions to the incentive money (just as they attach conditions related to production spending),” the report said and suggested that that every state require U.S. recording.
“If that state has sufficient infrastructure, it is likely to capture the work. If the state lacks the infrastructure, then it loses nothing (the work would happen elsewhere anyhow), but the U.S. economy benefits, as do U.S. musicians,” it added.