Vancouver’s film industry has taken a hit of late, with the dollar and loonie nearly at parity, and strong competition from Ontario, where tax credits are greater than those in British Columbia. Still, thanks to the strength of a burgeoning visual effects and digital animation presence, the biz in BC has managed to stay afloat.

According to the B.C. Film Commission, there were 30 productions shooting in British Columbia at the end of August, including features, MOWs and TV series. That compares with 35 at the same time in 2010.

Also a worry for local production is the phasing out, over the next 18 months, of a tax credit that helped reduce production costs 7%, In August, British Columbians voted to kill that credit, which helped the province compete with Ontario.

Since most Canadian broadcasters are located in Toronto, Ontario draws a greater share of homegrown production as opposed to international. In 2010, domestic production spending accounted for $646 million — compared with only $244 million for British Columbia; meanwhile, Ontario pocketed $318 million from foreign biz, while B.C. took in $778 million. Tellingly, however, that number is down from the $1.1 billion in foreign production biz the western province did in 2009.

TV shows shooting in Ontario include: “Degrassi: The Next Generation,” “Lost Girl,” “Murdoch Mysteries,” “Rookie Blue,” “The Listener,” and the miniseries “Bomb Girls.” Pics include the recently wrapped remake “Total Recall,” “Resident Evil: Retribution” and Guillermo Del Toro’s “Still Seas.”

According to “Still Seas” producer Callum Greene, Ontario’s tax credits were a large draw, as were the infrastructure and crews. “With a movie of this size and magnitude, we needed to find a way of marrying tax rebate with a crew that can build and shoot a movie this difficult — Toronto was sort of the perfect marriage of those things,” Greene says.

Peter Finestone, film commissioner for the city of Toronto, says he expects total production spending in the city this year to close in on $1 billion, surpassing last year’s approximate $900 million. And Donna Zuchlinski, film commissioner for the Ontario Media Development Corp., says the province is expecting to surpass its 2010 figures as well.

“(The tax credit) really jump-started things for us, so the activity we’re seeing now is the continuation of that,” says Zuchlinski, who notes that the addition of the Pinewood Toronto studios to the mix two years ago has helped provide quality services and solve space issues.

In 2009, Ontario began offering a 25% credit, as well as 35% on local labor (and enhanced incentives depending on length of shoot). This compares with BC’s credit of 33% on local labor costs. Additionally, the Canadian federal government offers a 16% credit of Canadian labor costs in both provinces, primarily for foreign productions.

And while some question the sustainability of the Ontario credits in the face of some U.S. cities, including Michigan, backing away from offsets, Zuchilinski cites strong provincial government support that creates confidence among the productions filming there.

“(The tax credits) are seen as very stable, reliable and dependable by our client base,” Zuchilinski says. “And when you’re (shooting) a long-term series, that’s very important.”

The situation in British Columbia, however, is hardly all doom-and-gloom.

Vancouver hooked season two of Steven Spielberg’s “Falling Skies,” which comes over from Toronto. The show’s visual effects will be done in Vancouver by Zoic, which worked on the series’ first season.

In fact, Vancouver has become a hot spot for visual effects and digital animation, developing a reputation for shooting cost-effective science fiction with a high-end look that began with shows like “Outer Limits,” “Poltergeist,” “The X-Files” and “Stargate,” according to British Columbia Film Commissioner Susan Croome.

“It was kind of luck of the draw that we started with a lot of sci-fi,” Croome explains. “Then we ended up with movies like “Mission to Mars” and, more recently, “Tron”; (now) we have a real expertise on how to do that.”

Part of the appeal is Vancouver’s climate. “You can shoot here outside in December when it’s rainy and it looks kind of sci-fi-ish,” Croome says. In this regard, TV is particularly good for the local film industry, because it means steady work for crews, set locations and shooting year-round.

Matt Damon and Jodie Foster were recently in town to film “Elysium,” a sci-fi pic by “District 9” director Neill Blomkamp, and “The Diary of a Wimpy Kid” continued to make Vancouver the home of the franchise, shooting its third installment there. Robert Redford’s, “The Company You Keep,” is shooting in town, as is the new Superman pic, “Man of Steel.” And several major shows are eyeing Vancouver to start shooting early 2012, Croome says.

There is no shortage of major television shows shooting in Vancouver either, including “Fringe,” “Once Upon a Time,” “Psych,” “Supernatural,” “Alcatraz,” “The Secret Circle” and the homegrown series, “Mr. Young,” recently picked up by Disney.

Adam Horowitz, exec producer for “Once Upon a Time,” praises Vancouver’s breadth of locations to fit the show’s fairytale world, which required the use of forests, lakes and fantastical vistas. “What we were able to achieve visually and from a production standpoint is not something we feel like we could have accomplished anywhere else,” he says.

Peter Leitch, president of North Shore Studios/Mammoth Studios and chairman of the Motion Picture Production Industry Assn. of British Columbia, maintains that the region’s tax credit is at a healthy level for the production services provided.

“You can probably find a better tax credit level if it is your sole reason for coming to a jurisdiction,” Leitch says, “But I think with our competitive tax credits, infrastructure, crews, great locations and proximity to L.A., we are certainly one of the best places in the world to shoot outside of L.A. and continue to be.”