Looming WGA action may end Canada's film boom

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TORONTO -- The threat of a Hollywood writers strike has Canadians expressing fears over cross-border fallout.

The local film and TV industry didn't expect to be wringing its hands over a possible Hollywood shutdown just yet. Soundstage operators and production equipment suppliers instead anticipated that the major studios and networks would keep coming here to stockpile film and TV product ahead of a possible SAG strike next summer.

That's had Toronto in overdrive with local movie shoots including Marvel Studios' "The Incredible Hulk" and Universal's "Repossession Mambo," while Montreal hums with Universal's "Mummy 3" as well as planned shoots for Roland Emmerich's "Fantastic Voyage" remake for Fox and the proposed "Night at the Museum" sequel, bound for Vancouver.

U.S. TV dramas before the camera in British Columbia include CW's "Reaper," NBC's "Bionic Woman," the second season of ABC's "Men in Trees," and ABC Family's "Kyle XY."

But the possibility of a work stoppage beginning Thursday has changed everything. The fear is that a WGA strike could interrupt the pipeline of U.S. movie and TV scripts expected to be shot in Canada before SAG talks come to a head in June.

Ken Ferguson, president of Toronto Film Studios, worries that U.S. film and TV projects could be derailed if screenwriters on the picket line after Halloween are not available for rewrites.

"As (studios) were greenlighting whatever they could to get production finished before June, that's the reason everyone was so busy, and we were busy," Ferguson said from Los Angeles, where he has been holding meetings with the major studios.

Victor Loewy, executive chairman at distributor Alliance Films, also warned Hollywood that a writers strike could disturb the supply of studio releases destined for the Canadian market.

"We will be just as much affected as the studios," Loewy said.

In the meantime, Canadian studio operators and production equipment suppliers welcome the American business because the rising value of the Canadian dollar has sharply reduced the normal dollar savings for Los Angeles producers shooting here.

"We're at levels that are ridiculous. No one could have seen that," said John Weber, president and CEO of the Dufferin Gate studio complex in Toronto.

The Canadian industry still faces a possible hard landing next summer once the major studios and networks eventually make peace with Los Angeles guilds and unions.

"We don't know what will happen. There will be a fall-off for sure. How much it is, no one really knows," said Paul Bronfman, chairman of the ComWeb Group, a major production equipment supplier here.

But enticing U.S. film and TV shoots to Canada is important to the Toronto Film Studio's Ferguson, who is at work to book soundstages in his $60 million FilmPort mega-studio on Toronto's waterfront, now under construction and slated to open its doors in March.

"We're opening FilmPort. We're hoping we don't open to a strike," he added.

To mitigate the effects of the high Canadian dollar, industry officials here have begun talks with the federal government to see if existing tax credits for foreign producers can be sweetened to keep them at work here.

"Our tax credits are not competitive anymore. We were the leaders a number of years ago, we're now distant followers," Comweb's Bronfman said of more generous tax credits on offer in rival locales, particularly southern U.S. states.

The provincial government in British Columbia said Friday that it will extend its tax incentive for foreign, mostly American, producers through 2013. The current provincial tax credit program was set to expire in 2008.

Nationwide, the strategy is to have Ottawa either increase its existing production services tax credit in dollar value, or to broaden its base to cover all expenditures by foreign producers here, not just Canadian labor costs.
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