Mexico tries to lure shoots to troubled country

Incentives, film commission try to smooth way for easier filming

Baja Studios is just four hours from Los Angeles, with facilities, including water tanks, used to shoot films such as “Titanic” and “Master and Commander.”

MEXICO CITY — For generations, helmers like Mel Gibson have fallen in love with Mexico as a backdrop, perhaps starting the day John Huston jumped off a boat at the Port of Veracruz in 1925.

But love alone isn’t enough to sustain Mexico as a competitive location with a host of Latin America locales, only a bit further than Mexico, like Colombia, Puerto Rico and Costa Rica arming themselves with hefty incentive programs and enticingly low pay scales.

Mexico was seeing one or two international shoots per year until last year, when the swine flu and the economic crisis added to other local problems. Walden Media balked on shooting the third installation of the “Narnia” chronicles last year at privately-run Baja Studios. Johnny Depp decided to take the production of “The Rum Diary” to Puerto Rico with its 40% refund, despite showing initial interest for shooting in Mexico.

Add in a drumbeat of bloody violence, and industry leaders and officials at every level of government are scrambling to bring foreign shoots back to Mexico.

The federal government isn’t waiting. Last week, President Felipe Calderon announced a new incentive program to be run through the nation’s foreign investment promotion agency ProMexico that would enhance spend refunds for mid- to large-scale, foreign productions.

However, the new plan has some drawbacks and takes some deciphering to understand. It essentially allows foreign production companies to refund up to 17.5% of their total Mexican spend with sales tax included.

Another barrier for smaller productions is the fact that the foreign spend must either hit a minimum of 70 million pesos ($5.6 million) in Mexican production expenses to qualify. If only doing post-production in Mexico, the minimum is $1.6 million. When spending on both production and post, the total must reach at least $5.6 million pesos.

With minimum spends in U.S. border states as low as $250,000, Chaparro says the government chose this higher figure to ensure a higher, more visible return to the economy as a way to sell the concept of tax incentives to an electorate who are generally more concerned with their own safety or better schools than film industry bottom lines.

Imcine’s production coordinator Hugo Villa emphasized that the ProMexico incentive will give film shoots specialized support from the nation’s immigration and safety departments.

The new incentive is designed to combine with any local or state initiatives and allows for co-productions with Mexican shingles, which have access to up to 20 million pesos ($1.6 million) through the National Film Institute’s (Imcine) Fidecine or Foprocina coin programs and another possible $1.6 million from the fairly successful 226 tax incentive program begun in 2006, which was strengthened legally in 2009.

226 was on everyone’s lips earlier this month at the LOCCINE Film and TV Locations confab held in Mexico City’s historic Churubusco Studios.

Attending the confab as part of a delegation of producers brought by the National Assn. of Latino Producers, Ben Lopez prexy of indie shingle VientoFuego said of 226, “That’s a big draw. That’s why we’re here.”

Tery Lopez, the WGA’s Diversity Coordinator and co-producer of Luis Mandoki’s 2004 “Innocent Voices” agreed, “We’re here to check it out … It’s easier to make a film out here with a lot of the incentives that are being offered to us as filmmakers.”

The new programs represent a tentative model for location shooting that is sparking interest with Hollywood as incentives and industry standardization catch up with Mexico’s seasoned crews and respectable technological capabilities.

Another hot topic at the conference was a new law making it easier to shoot in Mexico City, by creating a central film comission, uniform prices for permits and an end to a rampant system of petty bribes.

“Since the commission started we have had only about one complaint (of attempted unsuccessful corruption) in months we have about 500 days of shooting taking place,” said Francisco Uriegas, the Mexico City Film Commissioner and veteran location manager.

Uriegas added that they are nearing completion of a deal with U.S. companies to allow them to insure talent while shooting here and have access to a completion bond — a common stumbling block for shooting in Mexico.

Calderon made his ProMexico announcement at the formerly Fox-owned Baja Estudios, where “Titanic” and “Master and Commander” were shot.

The Baja site is one of several studios in Mexico that include the new Estudios Interlomas (spearheaded by Sony Latin American and Boomdog Films), a studio facility in the northern state of Durango left by the production of “Dragonball Evolution,” and old-school production hub Estudios Churubusco in Mexico City.

Jalisco also inaugurated a new state-supported, multimillion-dollar, film-technology “farm” just outside the Guadalajara last week during the festival. Already attracting projects related to this year’s bicentennial anniversary, the Chapala Media Park is designed to allow small companies access to high-end animation and other tech at a deep discount until the fledgling companies begin turning a profit.

However, all the training and installations in the world won’t negate the fact the country has to compete with Colombia’s bargain basement pay scale or hot Costa Rican incentives.

In Mexico’s defense, Carla Raygoza, director of the national film commission COMEFILM, was quick to point out that those countries cannot handle the level of production that Mexico can: “In terms of experienced crew, I think we have enough people to support three major productions at the same time, we’ve done it before.” Raygoza added that both Zacatecas and Durango state gave $630,000 to Mexican films shooting there in 2009.

There are hopeful signs, though, for the industry: Raygoza says the commission is now in talks about shooting in Mexico with major studios in Hollywood, as well as independent productions from the U.S., Australia, France and Spain. And Gibson has returned to the state of Veracruz, where he shot “Apocalypto,” to film “How I Spent My Summer Vacation.”