Ken Ziffren, newly appointed “film czar” for Los Angeles, told reporters on Thursday that a recently released report from the Milken Institute shows that the city is in a “bad spiral” when it comes to the loss of film and TV production and jobs.
The report from Milken Institute’s California Center, released on Thursday, showed that the Golden State lost more than 16,000 high-paying film production jobs between 2004 and 2012 — a more than 10% drop at a time when the state’s primary rival, New York, added 10,000 jobs thanks to its aggressive courting of film and TV biz with generous incentives.
“What the Milken Report does…is to show that the trends are bad. We are in a bad spiral, and what it suggests is that we need to turn this around and start improving the number of jobs and the number of labor workers that are going to be employed by this industry,” Ziffren said in a conference call with reporters.
Ziffren was named to succeed Tom Sherak as Mayor Eric Garcetti’s chief advisor on motion picture and television production, also known as the “film czar.” Sherak died last month after a long battle with cancer.
Ziffren said that a major focus will be pushing for legislation to expand the existing state incentive program, which he said was insufficient to compete with other states. California allocates $100 million per year, via a lottery, while New York’s incentive program is more than $420 million.
A key question is whether legislation proposed last week by Assemblymen Raul Bocanegra and Mike Gatto will have the support of Gov. Jerry Brown. Their bill would greatly expand the category of productions that would qualify for incentives, like most network, cable and Internet dramas, and would also remove a $75 million budget cap that prevents big-budget productions from gaining incentives.
Ziffren, who has long known Brown, said that the governor and his staff “are very interested in the progress of this legislation,” but they are likely to “take a look and see” and study the proposal as it goes through the legislative process.
“I don’t think they have committed one way or another, nor would I expect them to,” he said.
The latest blow to Los Angeles came on Wednesday, when New York Gov. Andrew Cuomo and Walt Disney Co. CEO Robert Iger announced that Marvel Studios would locate production of four live-action series for Netflix in New York City.
Ziffren, however, noted that such a series would not qualify under California’s current incentive program, as it does not include shows for the Internet. But he noted that Disney is still planning a studio expansion in the Los Angeles area on its Golden Oak Ranch property near Simi Valley.
As much as the Bocanegra-Gatto legislation is aimed at addressing the loss of production in certain categories, Ziffren suggested that there may be a need to add a “carve out” or separate accounting aimed at post-production or visual effects. The VFX business has been particularly hard hit, with major special effects firms shutting down altogether as jobs have migrated to countries with generous foreign subsidies.
Although he said that they planned to talk to California’s congressional delegation about the issue, Ziffren suggested that it may be outside the “scope of what we are trying to accomplish,” because it is a federal issue having to do with foreign trade. Los Angeles-based effects artists have been pushing the U.S. Trade Representative to look into pursuing some kind of duty in an effort to prevent jobs from going overseas.
The Sacramento legislation also does not include an annual dollar figure for the proposed expansion of the program, although there is some expectation that whatever is proposed will be in line or even greater than New York’s annual allocation. Ziffren said that amount will depend on a number of factors, including the state of the economy, the amount of the available surplus and the needs of other constituencies in Sacramento.
“At this point our office …is not committed to any particular number,” he said. “What we are looking to do is make sure all the legislators see the need for improved and modernized [incentives] legislation.”
If the number is large enough, he said, it would allow the California Film Commission to allocate incentives on a rolling basis, rather than through a once-a-year lottery, in which the $100 million is delved out in a single day. Although the lottery has been criticized by producers because it makes it more difficult for them to plan their budgets with certainty, it is the way that the program was set up so as to maximize participation and to be objective in allocating the incentives.
Ziffren said that “if the amount were increased substantially, we not have a need for a lottery.”
“With a rolling award, we would still have to find way to make it objective, so [for the film commission] it is not just, ‘What script do we like better?'”