Film advocates dubious that new NC grant program will attract entertainment businesses

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FILE -In this Monday, July 14, 2014 file photo, actress Rachelle Lefevre, left, on set of the CBS TV series "Under The Dome" prepares to film a scene where it is raining in front of the fictional Chester's Mill High School, on the campus of New Hanover High School, in Wilmington, N.C. The series has confirmed it will film its third season in North Carolina. (AP Photo/Wilmington Star-News, Mike Spencer, File)


FILE -This file photo released by CBS shows, from left, Dean Norris as James "Big Jim" Rennie, Alexander Koch as Junior Rennie, Natalie Martinez as Linda Esquivel and Mike Vogel as Dale "Barbie" Barbara, in a scene from the episode, "Heads Will Roll," from the series "Under the Dome," on the CBS Television Network. The show will film its third season in the Wilmington, N.C., area, taking advantage of a new grant program that replaces tax credits next year. (AP Photo/CBS, File)


RALEIGH, North Carolina — Advocates of North Carolina's film industry say even though one television series has agreed to return to the state, not many other movies or TV shows are likely to follow.

That's because of a grant program that's replacing tax credits next year, they say.

Until the CBS series "Under the Dome" confirmed it would film its third season in the Wilmington area, "the word from LA was already doom and gloom and North Carolina is over," said Johnny Griffin, director of the Wilmington Regional Film Commission. "With CBS committing to this third season, we're hearing 'you guys are still in business.' It gives us the ability to counter what we know will be the prevailing news, that North Carolina is kind of dead and done with."

The loss of film tax credits is part of a general legislative distaste, especially in the Senate, for tax credits in general. The N.C. Film Office is now part of the Economic Development Partnership of North Carolina, a new private nonprofit corporation that's handling state government's business-recruiting and marketing-and-tourism function.

The $10 million grant program, which will be in effect for the first six months of 2015, requires a $5 million minimum investment for feature films and $250,000 for television series and commercials. It also has a $5 million per-project cap for all productions. That will replace a 25 percent refundable tax credit on certain expenses exceeding $250,000.

Film and TV expenditures are on target to reach a record-breaking $300 million in 2014, Griffin said. With the grant program, that figure would top out at $40 million, he said.

"It will keep us afloat for a little while," he said. "We'll have to see what happens with the Legislature when it returns."

Guy Gaster, the new director of the N.C. Film Office, said the recruiting focus will be on North Carolina's variety of locations and its talented crew base. Of the incentives, he said: "Ultimately, it's balancing a budget and deciding what those priorities are."

"Under the Dome," based on the novel by Stephen King, films at EUE/Screen Gems Studios, where executive vice president Bill Vassar said he's accustomed to the ups and downs of the entertainment business.

"We have muddled through these storms many times," he said, adding that Canada offered massive tax breaks about the same time that Screen Gems bought the Wilmington studios in 1996.

Vassar and Griffin said they'll lobby the Legislature in 2015 for a more expansive incentives program, but it could be a tough sell.

Sen. Bob Rucho, R-Mecklenburg, said legislators will review the $10 million "and see if it has created the long-term jobs that anybody would like to get with any kind of incentives program."

Instead of looking merely at whether incentives create permanent jobs, Vassar said, perhaps legislators also should consider how much the jobs pay. Even though film and TV workers bounce from project to project, a recent study by a professor at N.C. State University showed that the previous incentives program provided more than 4,250 crew jobs at an average wage of $66,000. Incentive opponents say such studies don't take into consideration how else the state might have spent that money; Rucho says ending incentives has allowed North Carolina to lower its corporate income tax, making it more attractive to businesses.

Meanwhile, the film industry continues to recruit. "Under the Dome" could possibly qualify for half the $10 million pot of money the Legislature budgeted for grants so Vassar plans to look for smaller projects, such as television pilots, that won't eat up the rest.

"We're going to be here and we're going to survive and make a go of it with what we've been given and we're going to move as close to full-steam ahead as we can," he said.

Griffin is less optimistic and fears the Hollywood spotlight will turn away from North Carolina. Without more help, "we'll just go dark, hang it up," he said. "That's the way the business operates."


Online:

http://www.ncfilm.com/incentives.html

http://studios.euescreengems.com/nc/


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