NC FILM: Why Does North Carolina Need Film Incentives?

whyincentivesQUESTION: So Why does North Carolina need film incentives anyway?

ANSWER:  Ya know, if you would have asked this question 10 years ago, we would have said, we don’t because it was more about North Carolina’s array of locations, crew members, and infrastructure that attracted the productions.  Now instead of producers, directors and/or location scouts coming to the area, the studios send accountants first.  Hollywood producers now instruct accountants to draw up budgets for several possible states and make decisions on the economic impact on their production, not the locations.

North Carolina for years was the third largest movie making state behind CA and NY. However in the past decade, the film industry has become a global economic driver.  We are now competing with not just other countries, but a majority of the states that have seen NC flourish and want a piece of the action.  Other governors and state legislators acted in response when they saw the jobs and the economic impact. Let’s take Georgia, for example.  In two years Georgia’s state economy will have reaped the benefits of 7 billion dollars in direct spending from the film industry, which by the way took North Carolina almost 30 years to do. So if North Carolina had no incentives, then North Carolina just couldn’t compete with the other 43 states for those jobs and economic stimulus. “Show Business” is just that, a business. Could all 44 states that are participating be wrong?

NC Film: So what exactly is a “sunset?”

SUNSETQUESTION:  Everyone is talking about a sunset when it comes to the film incentives.  What exactly is a “sunset?”

ANSWER:  Another very popular question.  It’s basically a metaphor for when our film incentives expire.  So, when someone says, “Our NC Film incentives will sunset January 1, 2015,” that means that they will go away on that date unless our legislators vote otherwise.  This is a very dangerous and confusing way of doing business with production companies. Currently, unlike other states, we don’t have a film incentive permanently in place, our Reps just keep extending them every couple of years.  That means every couple years they are in danger of going away.  Production companies found our method to be unstable, and so they would rather do business with states that have something permanently in place.

You see, when these production companies look at states to film their movie or TV show, they can look as far as two years in advance.  So, for example, if Warner Brothers is looking at North Carolina today, and they wanted to begin shooting a movie in the summer of 2015, they would see that currently our film incentives are at risk of expiring six months before their start up date, so they wouldn’t bother even looking at us at all.

There is a BIG vote on our incentives in May 2014, and what we are pushing for is to do away with the “sunset” for good, and keep our incentives indefinitely.  That will be a game changer and we will see a hell of a lot more business here in our state!

BREAKING NC FILM NEWS: The Bill to End Film Incentives

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Remember that ridiculous amendment to the bill that would end film incentives one year sooner than 2015? Well, it was defeated BUT just by a baby’s hair!

While most of us thought it would crash and burn quickly, it was a super close call! After blah, blah, blah, the vote was tied 15 to 15. That means it failed. According to an article from WECT, “Representative Ted Davis says he had been gearing up for this fight at a later date, but now says he “really knows now who doesn’t favor film incentives.” Ted said he’s got some schooling to do with all those who were against it. I’m paraphrasing, of course.

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Here comes the competition: SC’s new film incentives

Yesterday, Gov. Nikki Haley signed into law a bill offering more incentives to movies and television shows that want to film in South Carolina.  And the new law makes the incentives permanent.

The previous incentives offered, 15% on all Wages and 15%+ on Supplies.  Now, the law allows film companies to be reimbursed 20 percent on payroll taxes for wages given to out-of-state people and 25 percent for state residents. Productions can also save up to 30% on the taxes spent at local business.  BUT the breaks don’t kick in until a TV show or film spends $1 million.

We still have better incentives here in North Carolina, but SC is now more appealing than before.  Check out the complete article from the Associated Press in the Star News.