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Hollywood Vendors Rally to Demand Improved Production Tax Credits

Show business vendors have rallied in the San Fernando Valley in the middle of a warm weekend with promises to support legislation to sweeten California’s film tax credit program.

Organizers said more than 600 attendees came to the Saturday rally at prop house Independent Studio Services in Sunland — three weeks after the introduction of Assembly Bill 1839, aimed at overhauling the current incentive program and attracting bigger movies and TV series. Speakers urged the audience to press their legislators on the issue, stressing that the tax credits are essential to keep productions from being lured out of state and that the credits provide a major boost to the Golden State’s economic health.

“It’s no longer our birthright to expect the industry to stay in California,” said Gregg Bilson, CEO of Independent Studio Services. “We have to have better incentives to keep us competitive.”

Jason Waggoner of Sylmar-based Star Waggons, which has about 100 employees, said runaway production has accelerated after starting as a relative “trickle” a decade ago when productions began seeking incentives in locales such as New Mexico.

“Our industry is picking up and leaving faster and faster,” he told the crowd. “There’s not a day that goes by that I don’t notice the negative impact.”

David Crowell of Southland Lumber and Supply Co., which had been a leading supplier of lumber to studios and production companies, told the crowd that his company shut down last month due to runaway production after 67 years in business. He blamed California, which enacted a production tax credit program five years ago with far smaller scope than rival states and countries, for not acting more aggressively.

“California turned a blind eye as our tentpole industry disappeared,” Crowell added. “Georgia is the home of Home Depot; it should not be the home of motion picture industry.”

Zach Keyworth, a manager at San Francisco-based rental house DTC Grip, noted that the runaway phenomena has become so pervasive that movies set in San Francisco — such “Godzilla,” “San Andreas” and “Rise of Planet of the Apes” — are filming a few days of “plate” shots in the city and shooting the rest of their films in such incentive-rich locales as Vancouver and Australia.

“If we can create a level playing field, we have a chance to take back our industry,” Keyworth said.

California Assemblyman Raul Bocanegra (pictured), co-author of AB 1839, noted that the disappearance of the movie industry from the San Fernando Valley is coming in the wake of manufacturing for autos, aerospace and faucets having departed. He promised that won’t happen again.

“We’re going big and we’re not going home,” he told the crowd.

Bocanegra told Variety after the two-hour event that the first hearing for the bill will come March 25 at the Assembly Arts and Entertainment Committee. Assemblyman Jimmy Gomez, a member of that panel, said that constituents in Los Angeles support his campaign pledge  to improve the incentive program.

“We are our brothers and sisters’ keepers and we never forget,” Gomez added.

A quartet of members of the L.A. City Council — Bob Blumenthal, Felipe Fuentes, Paul Koretz and Nury Martinez — also spoke at the event. “Our families should not have to travel to Georgia, Louisiana and Baltimore to work,” Martinez said to cheers.

The event, organized by the California Film and Television Production Alliance, came three weeks after a union rally on the same issue drew over 700 supporters to Burbank’s Pickwick Gardens.  

The bill, the California Film and Television Job Retention and Promotion Act, would renew California’s tax incentives so it runs an additional five years, through the 2021-22 fiscal year. The legislation has 59 co-authors.

The legislation would lift a $75 million budget cap on productions that are eligible for the program and all network and cable dramas would be eligible. Lawmakers have yet to place a dollar figure on how much would be available each year. Demand for incentives far exceeds supply under the state’s current $100-million per year funding.

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