News

Canadian competition for Hollywood films tough on Montana industry

Patrick Markey is working on a movie project, a four-hour HBO film to be called "Bury My Heart at Wounded Knee."

Markey, who co-produced "A River Runs Through It" and "The Horse Whisperer" here in the 1990s, liked the place enough that he moved here. Now, he wants to shoot the Wounded Knee project in the Bozeman and Livingston area, he said in a recent interview.

By SCOTT McMILLION Chronicle Staff Writer

http://bozemandailychronicle.com/articles/2004/09/19/news/north.txt

He’s found the locations he needs. The crews are available. From an artistic perspective, he said, the project is a perfect fit.

But doing so might be too expensive for the accountants at the HBO studios.

"They want to make me shoot in Canada," he said.

Around North America, states and provinces are competing with each other to attract film projects, which spread a lot of money around but don’t extract resources or cause many lasting damages.

"We take pictures," Markey said. "We leave money."

Sometimes, it’s a lot of money.

Filming peaked in Montana in 1993, when movie producers dropped $20 million in the state.

And that money circulates. Lots of people get a chunk of it, from car rentals to landlords, from gas stations to caterers and garbage haulers.

But where the money goes depends in large part on what kind of deal state and local governments cut with the studios.

How to lure movie companies already is becoming a campaign issue in the Montana gubernatorial race, and it likely will be debated in the Legislature next year.

In some places, the incentives are big.

In Alberta, local companies, even if they are just part of a larger group, can obtain grants of as much as $750,000 to make a movie or TV show.

A more common tool is tax credits, a dollar-for-dollar reduction of income taxes. If your company can’t use all the credits you earn, you can sell them to somebody with a bigger tax bill.

Pennsylvania recently offered Disney $2 million in tax credits to transfer production of a movie called "Annapolis" from, of all places, Annapolis, Maryland, according to the Philadelphia Business Journal.

In Georgia, which in its peak was the third busiest state in the country for movie making, business is off $200 million since 2002.

In Louisiana, which offers tax breaks and credits to movie makers, the film business is up by $200 million in the same period, the Associated Press reported last month.

In Montana, film production spending has shrunk to an average of $6.8 million annually over the past five years.

"Things have slowed down since we started facing competition from Canada and other countries with good exchange rates and subsidies," said Stan Iverson, manager of the Montana Film Office, a part of the state Department of Commerce.

Markey is a little more blunt.

"We missed the boat," he said.

The film industry attracts a lot of attention for the extravagant lifestyles of major stars. The fancy cars, the mansions, the swimming pools. In the 22 states and 10 provinces that offer tax breaks and other incentives, lawmakers often grouse about subsidizing an already wealthy industry.

"That’s the first argument you hear," said Dan Chugg, the Alberta Film Commissioner. "But all we are about is the growth of our local economy. Nobody is getting rich from movies in Alberta. They’re making a living."

Chugg said 18 made-for-TV movies were filmed in Alberta during the last fiscal year, providing Albertans with equivalent of a year of work for1,800 people.

"We’re going to be in excess of that this year," he predicted.

For every mega-blockbuster, there are scores of projects that barely break even, Chugg said.

Behind the scenes in all those movies, TV shows and commercials are thousands of working people and small businesses that benefit from America’s obsession with stories on celluloid.

Incentives are meant to help those people, Markey said.

"The stars are not the ones we’re talking about," he said. "About 95 percent of the people in the business make a decent living, but not an extravagant one."

Actors, Markey noted, will draw their big checks whether the film is shot in New Mexico, Utah or Montana.

Of those states, only Montana offers no incentives. And if the crew goes somewhere else, so does all the money.

Like wheat and timber, movies operate in a global economy, Chugg said.

"It’s a great game to be in, to a point," he said. "You have to compete with incentives."

Markey is part of a group called the Montana Film Center, which has been working to drum up renewed interest in the industry. It also is getting behind the gubernatorial campaign of Democrat Brian Schweitzer, who advocates a 15 percent tax credit for the money movie companies spend in the state.

Since most movie companies don’t pay much in Montana income taxes, the credits likely would be sold, generally at a discount, to Montana businesses.

"It’s really pretty straightforward," Schweitzer said.

If a studio spends $10 million in the state – a realistic figure – it could earn a tax credit of $1.5 million. While state tax revenues would fall by that much, Schweitzer said, the $10 million spent here would turn over at least three times, more than making up for the lost tax revenues.

Republican candidate Bob Brown’s office was dismissive of Schweitzer’s idea.

"Generally, he’s opposed to tax relief for out-of-state corporations," Brown campaign manager Jason Thielman said of Schweitzer. "So it’s very perplexing to us that he favors it for Hollywood."

Moviemaking is a good industry, he said, but Brown favors tax relief that favors all types of business.

"We should encourage that industry like all industries," Thielman said.

Montana Representative Chris Harris, D-Bozeman, said Friday he plans to introduce an incentive bill in the next Legislature but hasn’t worked out details yet.

"I think the big picture is pretty clear," Harris said. "We’re losing a lot of movie business" by not offering incentives.

In addition to direct spending, movies advertise and promote the state.

Western Montana’s real estate boom began in the early 1990s, shortly after the release of "A River Runs Through It" and the attendant publicity. While opinions differ on whether that’s good or bad – and the movie wasn’t the only factor involved – rising land prices have put a lot of money in the pockets of the real estate and construction industries.

With incentives, Montana could move to the front of the stage, Markey said. It has the scenery, the locations and the grips, gaffers, location specialists and other skills needed to make big movies. Montana State University’s film school is an incredible asset, he said, but most graduates leave the state.

"We crank them out and they leave," Markey said. "They go to Hollywood."

Without the incentives, Montana just can’t compete with states that offer them, he added, even if a Montana theme is key to the movie’s plot.

If studios were shooting "The Horse Whisperer" or "A River Runs Through It" today, he said, "it would not be shot in Montana."

Sorry, we couldn't find any posts. Please try a different search.

Leave a Comment

You must be logged in to post a comment.