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Runaway Production Update
Department of Commerce Report Confirms Monitor Report
While California Launches Film California First Program
Runaway film production is having an increasingly negative impact on the health of U.S. film and television production. That's the conclusion reached in a recent report issued by U.S. Secretary of Commerce Norman Y. Mineta. The independent Department of Commerce report confirms the alarms raised by the June 1999 DGA and SAG Monitor Report.
The Monitor Report revealed that runaway production had cost U.S. entertainment industry workers more than 60,000 full-time equivalent positions in the prior three years alone and that more than $3 billion in goods and services had been lost in support industries such as hotel, real estate, medical, restaurant and retail trade. The report also estimated that $1.9 billion had been lost in payroll, income and sales taxes to local, state and federal governments.
The recent Commerce Department was initiated through a request from a bipartisan group of U.S. House of Representatives members: Mark Foley (R-Fla.), Howard Berman (D-Calif.), Robert Matsui (D-Calif.), Jerry Weller (R-Ill.) and Xavier Becerra (D-Calif.). These five members have been closely working with the DGA and other organizations on this issue over the past year and a half.
Drawing from a number of independent sources, the Commerce Department report further revealed that domestic shoots of movies for television made for broadcast on U.S. networks and cable systems declined 33 percent in the last six years while U.S. movies for television productions shot at foreign locations increased by more than 55 percent. Six years ago, 62 percent of those productions were shot in the United States. As of the 19992000 season, the figure was 41 percent.
"The most serious impact is in the area of made for television movies for U.S. networks and cable systems," Secretary Mineta said. "However, the impact is far ranging. Runaway film production has affected thousands of workers in industries ranging from computer graphics to construction workers and caterers. These losses threaten to disrupt important parts of a vital American industry."
The Commerce Department report also includes a study which estimates that the overall yearly economic loss to the U.S. may be as high as $10 billion.
Congressman Foley, also Chairman of the House Entertainment Industry Task Force, said, "Domestic production is the lifeblood of our entertainment industry. Hundreds of thousands of jobs across the country depend on our domestic production. This report outlines the severity of the problem and underscores our need to work proactively to stem this growing tide."
Congressman Berman agreed, saying, "This is a substantive report that documents the problems we face in keeping our industry jobs here in America. The below-the-line employees are really hurting in Los Angeles and other U.S. cities."
"The stakes are high when we are talking about people losing their jobs," Congressman Becerra said. "This is why protecting the vitality of Los Angeles' entertainment community will be one of my top priorities this Congress."
The goal of helping American film production companies compete on an even playing field with foreign companies who offer tax and other economic incentives to lure away U.S. production, is also top on the agenda for Congressman Matsui. "This report points to specific factors that may make American companies less competitive," Matsui said. "This will help lawmakers and industry representatives make the right reforms."
DGA President Jack Shea welcomed the release of this report which confirms what the DGA has been saying. "On behalf of the many thousands of working men and women in our Guild and the industry, we are grateful to Commerce Secretary Mineta and his professional staff for their comprehensive study of the loss of production and American jobs to other countries as well as its impact on American workers in the movie and television business," Shea said.
"The DGA looks forward to working on solutions to this problem with the 107th Congress and the Bush Administration to build on the strong leadership already shown by our bipartisan Congressional supporters, including Congressman Foley, Berman, Matsui, Weller and Becerra."
Already hard at work on the issue at a local level, California Governor Gray Davis had unveiled the "Film California First (FCF) Program" to provide $45 million from the General Fund to cover certain costs incurred by film productions in California. The program was approved by the California Legislature in June 2000 and became effective January 1, 2001. The DGA actively worked with the California Film Commission (CFC) in Sacramento to secure the inclusion of the FCF Program in the Governor's budget and its passage through the legislature.
Once again, the measure received strong bipartisan support, this time through the efforts of State Senator Pro Tem John Burton, State Senators Jim Brulte, Sheila Kuehl (then an Assemblywoman), Adam Schiff (now a Congressman), Speaker of the Assembly Robert Hertzberg and Assemblyman George Runner.
Among the costs eligible for reimbursement are: state employee costs; federal employee costs; federal permit and rental costs; and local public employee costs for fire services and non-police public safety. Also included are a film incubator program to help attract and retain innovative independent productions and the State Theatrical Arts Resources (STAR) Program designed to streamline state bureaucracy for producers.
Information about the CFC is available on the DGA website (www.dga.org). In addition, the DGA has notified UPMs about the program and provided information at the AD/UPM Council Meeting.
Gov. Davis, through the California Film Commission, also recently announced the launch of a Web portal on the one-stop California website (www.filmcafirst.com). The site allows filmmakers to download Program guidelines and eligibility information and submit completed FCF applications without leaving their production offices.
About FCF, DGA President Jack Shea said, "The DGA is grateful to Gov. Davis and the leadership in the State Senate and Assembly for taking action on this serious threat to the livelihood of people who depend on entertainment industry jobs to feed their families."
-Ted Elrick
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