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Utah State’s film fund is almost dried up

A few months after it was greenlighted, a fund designated to lure filmmakers back to Utah is almost dry. And the fund’s director said some structural problems are already becoming apparent.

Only $160,000 remains of a $1 million fund designed to attract filmmakers to Utah, according to Mark Renda, the state’s Industrial Assistance Fund director.

http://deseretnews.com/dn/view/0,1249,595088191,00.html

The fund, a demonstration program established in May at the recommendation of the Legislature’s Motion Picture Task Force, designated $1 million in IAF money for film incentives.

The incentive allows film, commercial and television productions to get tax rebates, with no single project receiving more than $500,000 in rebates. Bonus money (though the total may still not exceed $500,000 per project) is given if Utah is included in the project narrative or storyline.

To date, four projects have met the fund’s criteria and have together received $840,000, Renda told the task force Tuesday. One of the films, "World’s Fastest Indian," stars Anthony Hopkins. Meryl Streep is slated to star in another, "Dark Matter." Both films are in pre-production.

Though it was a coup for the state to snag the four films, task force members and IAF officials agreed that Utah’s entertainment/film incentive program needs retooling. Currently, Renda said, the IAF board looks for projects that will "leave" dollars in the state, through infrastructure build-up or jobs; projects that already have their budgets secured; and those that have distribution arrangements in place (or a reasonable likelihood for securing distribution).

The fund structure also doesn’t quite fit into the established IAF framework, Renda said. Traditional IAF money goes to companies that promise to create jobs for the long term. Films generally do not, Renda said, though they do employ crew members, many of whom live permanently in the state.

"If you’re going to create a specific fund for investment or rebates, we probably think it should be outside of the Industrial Assistance Fund," Renda said. "It’s an apples and oranges comparison, and our board is predisposed towards permanent jobs, and this industry has a poor nexus between the employer and employee. Left to our own devices over time, this board would probably not do as many film incentives as the state may want to do."

Renda said the board should administer all incentive funds, but the funds should be kept separate.

Further, Renda said, there are problems with the funding mechanism itself. For example, the current mechanism doesn’t include a way to "incent" a television series or a block of made-for-television movies. (Networks like Disney often package their planned line-up of made-for-TV movies together and shop them out to the most attractive bidder.) Also, he said, the way the incentive fund rewards projects that agree to include the Utah brand in the content of the project may put board members in an awkward position.

"There’s a concern that if you read through a script … and it casts Utah in a negative light, then what would be the reaction of the board?" Renda asked. "We haven’t hit that yet. We haven’t had to have that discussion. But it’s a discussion that will come up on a project sometime."

Sen. Ron Allen, D-Stansbury Park, was the first to use the "C-word."

"If at one point content becomes a controlling issue for the board, we’d get the reputation for perhaps being a state involved in censorship," he said. "I think that would undo any of our incentives."

At the same time, Allen said, "We don’t want to attract a regular stream of films that the local populous would find for whatever reason unsavory.

Currently, the board’s "content meter" requires only that the project isn’t "X-rated," Renda said.

The task force is expected to make its report to the Legislature in November. Whatever it decides, California entertainment consultant Jeff Chamberlain said the state must do something if it wants its share of the pie.

"It’s basic economics," Chamberlain said. Even Hollywood has been devastated, with productions flocking to cheaper locales in Canada and abroad. Other states are putting together aggressive tax incentive packages, and Utah must act if it wants to remain competitive.

"The Legislature realizes that we’ve got to do something else, and that was the purpose for this task force," said committee co-chair Rep. Sheryl Allen, R-Bountiful.

Sen. Ron Allen said an informal survey of legislators revealed "universal" desire to keep bringing film projects to the state. Moreover, Allen said, many in the House and Senate have expressed "a willingness to do things they would not normally do" in terms of tax policy and expanding incentives.

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