State lacks incentives for film projects
Stars may have fallen on Alabama, but the moon is rising in Louisiana.
Tuscaloosa native Lee Faulkner is bringing "Alabama Moon" by south Alabama author Watt Key to the big screen, but he's shooting the film in Louisiana, where the film industry employs thousands and generates millions in revenue.
And when the movie hits theaters next year, its title will be "Louisiana Moon."
"We're going to change the movie's name," he said. "There's no reason that Alabama should get any credit for it."
Alabama lost the project -- only the latest in a string -- after legislators failed to pass tax incentives to attract the film industry back to the state during their last session.
"It kills me to see Alabama spend all these millions on building infrastructure to attract these big industries, but won't give incentives to filmmakers," said Faulkner. "With the right incentives a film could come in and spend $10 million in three months. That's cash money, spent in Alabama's economy."
More than 41 states offer tax breaks to the film industry, but Alabama isn't one of them.
More and more investors in entertainment are demanding that producers make their movies in places that offer incentives, said Daniel Wheatcroft of California-based Shoot to Thrill Productions, who has consulted with states -- Alabama included -- on entertainment industry opportunities.
"If I'm a producer, I have to find investors to make my film," he said. "But these investors will only cover 50 to 70 percent of what I need, and I have to fill the gap."
Unlike so many industries rocked by the recession, Wheatcroft said, movies are still being made around the world. Even international filmmakers are looking to the United States because so many states offer incentives.
Studios no longer provide 100 percent financing, and filmmakers need incentives and rebates from states to make up the difference, he said.
Alabama offered modest incentives from 2001 to 2006, when they expired and advocates began their unsuccessful efforts to get them back.
The incentives worked. In the four years that the breaks were on the books, 14 films were shot in Alabama. The state gave away $15.7 million in exemptions but generated $89.4 million in revenue. Since the act expired, Alabama has been the location for only five movies and has seen its film revenues dwindle to nearly zero.
In the 2008 regular session, the Legislature failed to pass a measure that would have done significantly more for filmmakers than the 2001 package. Along with many bills, the Alabama Entertainment Industry Incentive Act of 2008 got caught up in a contentious session where little got done.
Under the incentive act, a qualified production company could have received a tax break equal to 25 percent of state-approved expenses, excluding payroll paid to Alabama residents, and a tax break equal to 35 percent of all payroll paid to Alabama residents.
To qualify for the tax breaks, expenses for a project would have had to equal at least $500,000 but no more than $10 million. A qualified production company that spent $150,000 or more for multiple projects within a 12-month period would have been exempt from paying state sales, use and lodging taxes.
Faulkner, the movie producer, contends Alabama's proposed incentives wouldn't have persuaded him to make his latest venture here because Louisiana's incentives offered him more advantages.
"The tax incentives they're trying to pass don't offer enough," he said. "You'll get real low-budget films, and I don't think it would amount to much."
Wheatcroft disagrees, especially since Alabama is surrounded by states with far more money to attract big-budget feature films. He suggested Alabama's incentives, too, could attract television productions.
"There is no reason for Alabama to enter a market that is already saturated with states trying to attract $80 million projects, when 85 to 95 percent of projects fit into the $500,000 to $10 million range," he said. "Alabama could create a niche for itself that no other state is filling."
Under the incentive act, a producer wouldn't get any rebate until after the production is completed, though any money spent by the production in stores, on payroll, with accountants and lawyers would go directly into the state's economy.
The proposal, Wheatcroft believes, is a win-win: Alabama gets an economic boost yet protects itself from spending too much too fast.
The problem, though, is still getting the bill through the Legislature. Nobody knows just how hard that's been better than state Rep. Richard Lindsey, D-Centre.
Lindsey's measure faced opposition last session from the Alabama Education Association because of funding. With the disagreement resolved, Lindsey intends to get the bill out and on the floor as early as possible.
The bill already has nearly 45 co-sponsors, but Lindsey hopes to get at least 60 and have the bill pre-filed before the end of the year.
Lindsey will have the backing of the state Department of Tourism, the winner of several awards for promoting the state.
The tourism agency will soon absorb the Alabama Film Office, now part of the Alabama Development Office, according to tourism director Lee Sentell. The film office will keep its staff.
The development office, Sentell said, focuses on attracting product-oriented industry such as auto manufacturing while tourism promotes the state.
"There is a common relationship between tourism promotion and film development," he said. "Alabama has the potential to be a great state for the film industry."