10,600 entertainment jobs leave Calif.

Report says permanent tax credits will entice industry

There are 36,100 fewer jobs in California because the state hasn't sufficiently wooed the entertainment industry, according to a report issued Thursday.

The Milken Institute report says 10,600 entertainment jobs have fled the state since 1997 along with 25,500 jobs indirectly related to the industry.

The entertainment industry jobs that have been lost paid an average salary of $92,000 per year, according to the report, titled "Film Flight: Lost Production and Its Economic Impact on California."

It lists a sample of movies that chose to film outside of California to take advantage of more lucrative tax credits and other business incentives. The most ironic title? "Captain America: The First Avenger," which is filming in England.

The 40-page report says 42 states, including California, and the District of Columbia offer incentives for film and television production, but it also notes that California's are less ambitious than many others.

New York recently won "Salt," for example, and Georgia got "The Blind Side" and "Zombieland." New Mexico has "Cowboys & Aliens" and "Thor," and Clint Eastwood took "Gran Torino" to Michigan.

Joining "Captain America" in the ironic category is "Battle: Los Angeles," which Columbia Pictures is filming in Louisiana.

The report says the film production industry is worth $57 billion annually and that California has given up $2.4 billion in wages and $4.2 billion in economic output since 1997, the peak year in entertainment employment in the state, when its share of North American employment in the industry was 40%. By 2008, it had dropped to 37%.

A year ago, California implemented a tax credit for projects budgeted below $75 million, and 75 TV and movie productions have been approved to receive those credits. But the report says California should do much more, including:

-- Make the tax credits, scheduled to end in 2014, permanent.

-- Provide the California Film Commission with enhanced staffing and marketing resources.

-- Expand tax credits for TV production to include network and premium cable shows.

-- Consider digital-media tax credits to retain developers of digital animation, visual effects and video games.

-- Encourage investments in infrastructure by implementing tax credits for building and upgrading studio and post-production space.

"The motion picture and television industry may trade in fantasy and escapism," the report says, "but as a business, it is hardly immune to economic pressures and the imperatives of technological change."
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