Last year, members of The Hollywood Reporter's independent film producers roundtable yearned for one thing, other than better parking: rebates. This year, they have them, and some -- like Picturehouse's Bob Berney on Steven Shainberg's planned 2006 drama "Fur" and GreeneStreet's John Penotti on Joby Harold's upcoming thriller "Awake," a co-production with Open City Films -- are taking full advantage of the governmental largess. What's it like to be a New York producer in 2005? THR's Randee Dawn spoke in July with Berney, Penotti, Killer Films' Christine Vachon, Iridium Entertainment's Marisa Polvino and Co. Op's Bob Kravitz at the new IFC Center cafe the Waverly. What emerged was a much more worldly outlook on producing, coupled with a fierce grip on remaining independent at all costs.

The Hollywood Reporter: A year has passed since our last independent producers roundtable. What has changed for you all -- other than the rebates, which we'll get to?
Bob Berney: One thing for (Picturehouse) is having Steiner Studios (open), which we're using for "Fur." It's another facility, and along with the rebates, that's why we were able to (film in New York).
Christine Vachon: I think the big change is (Picturehouse), another New York-based company.
Berney: We're all really proud to be New York-based. I'm glad that it worked out that our first production was shot in New York -- we want to do more.
John Penotti: It feels like what we get out of the New York (Mayor's Office of Film, Theatre and Broadcasting) seems to be quicker and a little more elaborate.

THR: Also different is the building we're in: the former Waverly Theater, now the IFC Center. How big a deal is this place?
Penotti: I think it's big. We have to be really proactive about supporting films here, and for (GreeneStreet), we look at it as another place for premieres and parties. Personally, I think it's very important.
Marisa Polvino: I think it's important as well. When I first moved to New York 15 years ago, I used to come to this theater all the time, watching films that really influenced me to get into the independent film business. To see it reopened, I'm very excited: It's another venue for independent film to have a place to be seen, aside from the Angelika.

THR: Can the IFC Center truly create a community for indie filmmakers?
Bob Kravitz: It helps to some degree. It comes from functionality: If something's really functioning at capacity, then the people from the film community can use it -- and if IFC continues this commitment to it, then absolutely.

THR: The Independent Feature Project also is undergoing changes here in New York, largely in hope of creating a more-unified indie film community. How did the divorce from its Los Angeles wing affect your relationship with the IFP, and are the organization's efforts useful for you?
Vachon: I've been pretty public about why I think (the split) is a bad idea, and I still do (think it is), but I'd be curious what everyone else thinks.
Penotti: I don't accept that (the two wings) will be more disparate now. The limited resources they have are not going to be split, which I think was the biggest issue. It seemed to me that at least now, you could have each of the chapters focus on the specific needs of their region. It seemed like a compelling argument -- you remember (on) some of the decisions, you were waiting for the West Coast to come up with a decision that had no impact on them -- so I thought maybe it was going to be a positive thing to have a more-concentrated effort (in New York). But I'm not sure if that's what's happening.
Polvino: I think that (IFP's New York executive director) Michelle Byrd has made tremendous efforts to unify independent producers in New York and strengthen the organization here, knowing the split was coming down. The challenge is in our hands as members. I assume we're all members ...
Vachon: I don't know if I am. (Laughter)
Kravitz: I remember getting papers for it ...
Polvino: I think it's our responsibility as well to take care of independent filmmakers and all of the issues associated with (indie filmmaking).
Berney: The troubling part is, it just seems like a misstep to split up in terms of uniting independent filmmaking -- that is kind of sad. Maybe operationally it works, (and) maybe politically, but it seems like a backward step. That said, in New York, they've just got to make the best of it and pull together -- the Gothams are important. The market is not something I'm so much concerned with, but I'd like to see them working on ways to market independent films, using the organization to help us get the word out.
Vachon: But is the IFP really for us? I mean, that's the other question.

THR: You mean, is it only for up-and-comers, not established producers?
Vachon: The IFP has served as a nexus/rallying point for various issues like the (2003 MPAA) screener ban (and) how to put together rebates in ways that people like us could understand what they're talking about. My office, and I'm sure John's office, has been involved in various committees, etc., so I think as an institution to organize around, it has been reasonably effective.
Berney: It's just a shift in their focus from markets. The screener ban was the catalyst in that, and I think the people in the (indie) community realized there could be a different use for that. I hope Michelle will take that and expand that.

THR: Do you ever get the sense that Los Angeles simply doesn't "get" the importance of New York or what's going on here?
Vachon: The IFP split certainly underscored a sense of that, which I think is a shame because actually, for me, with the Internet, my filmmaking has never been less localized. I find that most of the creative executives that have dealings in L.A. recognize the fact that there is a certain pool of talent here that they're not getting there, and they want access to that. I don't think people are writing off New York at all.

THR: Maybe not so much writing it off, but always considering it subsidiary or secondary?
Penotti: Except on a practical level, people tend to concentrate on what's right in front of them. I don't see a visible effect or programs in mind or things that minimize New York's involvement.
Polvino: It also depends on how active you are as a filmmaker, what films you're making and how visible you personally are with the agencies or studios or other filmmakers on the West Coast. If you're not doing that, or you're foundering in development, then you're going to be obscure in the eyes of either coast.
Berney: Some of the agencies have opened offices here, so they're obviously reaching out. It's not just a studio backyard.
Penotti: Again, what you were saying about having Picturehouse here and having other distributors there. It's not that you don't need L.A. to do it, but there are resources here -- we can take care of ourselves -- and L.A. knows there are other opportunities here. And I agree, with the Internet and how quickly we communicate anyway, more and more, I don't feel any bit of that disparity that existed 10 years ago.
Kravitz: The other thing is, as far as talent pools, we have a lot to offer, (especially) projects that originate from theater (and) writers who have started in theater. There's something that if they want to tap into that over here, (they) mainly have relationships with New York producers in the community.

THR: OK, rebates: Now that they're here, do they work? Bob, you used them to make "Fur," correct?
Berney: The timing was perfect and did make a difference. It was close enough that we probably could have done it (elsewhere).
Penotti: We've started on one film now ("Awake"), and (rebates) absolutely made the margin that made it possible to bring the film back from Europe. Even with the exchange rate, it was this strange anomaly that it was still cheaper to do it there because the subsequent tax rebate was still higher prior to the (New York) rebates.
Polvino: Even with the exchange rate?
Penotti: Even with the exchange rate because even though you're paying more upfront, you're receiving it more back. So for us, we had the opportunity to have a film that was set in New York back in New York. It provided close to $1 million (in rebates).
Polvino: We're about to hand in our final application on our last film for it (Michael Corrente's upcoming Lions Gate release "Brooklyn Rules"), so I'd like to see if the money does come back as an actual credit.

THR: How would you have written them differently? What would make the New York rebates more amenable to independent films?
Penotti: Make them bigger.
Kravitz: Right! A 100% rebate! (Laughter)

THR: Can smaller productions take advantage of the rebates like big-budget films can?
Penotti: I think there's some flexibility down to the lower end of the budget. I think some of the restrictions include the use of a stage facility, which I understand the reason for. That was very telling for the city and state to go along (with the studios); facilities could be a growing industry. It would be great if they linked it to things beyond just facilities -- maybe link it to a number of shooting days.
Polvino: One of the loopholes I think is great about it is (that) you really only need one day at a studio to qualify.
Penotti: They have to be certified studios.
Polvino: You have to have a legitimate day there. You have prep days, (and) you have to build a set -- you can't just walk in and rent a studio for the day. The studios were very proactive on the legislation: They wanted to lure people like the larger-budget films who will build full sets and spend tens of millions of dollars in New York. Smaller players can be cost-effective, but I don't know if you're dealing with a $1 million budget if it can be. A $6 million or $10 million budget, it can be -- hopefully.

THR: The rebate legislation obviously was studio-backed, thanks to heavy lobbying efforts. Were independent producers consulted?
Penotti: Tim Williams, who works at (GreeneStreet), was intimately involved -- I know they ran drafts by him endlessly -- but I don't know how much his overall suggestions got into the legislation.

THR: If we agree that the rebate legislation is good but could be more independent-film-friendly, then do you think it would be useful to have a more-organized producers group lobby for the next draft?
Penotti: More organization anywhere would be great, (but) I don't know how practical it is in the scope of things we do to organize yet another lobbying group.
Berney: That goes back to, there's more the IFP can do (that) is issue-specific, so that when something like this happens, it's good to try and use them for that reason.
Kravitz: As an independent producer, the more I can work with other independent producers is great. But when you're dealing with issues, I'm kind of myopically focused: I've got to deal with what's on my plate; I'm not thinking about fixing it universally. I'm just worried about getting through the projects I have in a way that I have to, and that can be a problem.

THR: How tied to the devalued dollar is the success of New York's new film rebates?
Vachon: The value of the dollar has really put a big wrench in Toronto for a lot of projects (that otherwise would) use that (city) as a viable alternative. I know I should be saying: "This is great! It means we're shooting here!" But the fact is, (for) some of these movies, the cost of shooting here is so high, and Toronto really was a way to get them done -- and that's not really a possibility anymore because we're so screwed on the exchange rate.

THR: Are New York's numbers not making up for what you're losing out of Toronto?
Polvino: Lots of other states have aggressively legislated for
tax rebates and tax incentives: States like Rhode Island have great incentives, and Boston is literally 40 minutes away. The rates are cheaper and the Teamsters are a little more amenable (elsewhere), and you have New Mexico (among others), and they're very aggressive -- and that's also a draw for a producer who only has so much money to make a film that isn't necessarily based in New York. You're running numbers every second.

THR: From your standpoint, how much of a growth area are international markets?
Penotti: On the sales side, (though) maybe not on the directing or producing (side), we always have our eye on how films can do overseas. We do a lot of work looking at each of the territories and trying to decide what value there is -- anything that would help drive international distributors to our product is good.
Berney: I think it's important because even if you're doing something that is purely American, you really need financing from international (sources) as well. At Picturehouse, I want to figure out ways for smaller films to have better international profiles in sales; it's a goal of HBO and New Line, our parents and partners, to figure that out. The numbers look a lot better for us if we can share the risk on international.

THR: What continues to motivate you to make movies in New York, in addition to being based in the city?
Penotti: For us, it's the diversity of stories and the diversity of the type of talent here, (including) writers (and) directors. Someone commented earlier on that this happens to be home for talented early-stage participants in film -- and I'm sure that occurs in Los Angeles, too, but that seems to happen here to a greater degree.
Berney: As a distributor, we often launch films here. To be here all year is important -- (and) again, as a distributor, the proximity to Europe is a good thing.
Polvino: Being able to continue to find new, interesting stories inspired by films that I see fuels me to buy more material.

THR: Last year, rebates topped your wish list. For what do you hope during the next 12 months?
Vachon: A stronger dollar. (Laughter)

THR: So you can make movies in New York, or so you can return to Toronto?
Vachon: A stronger dollar so we have choices.