Shootout in the Southwest
America’s desert states are being pitted against one another in an ugly incentives showdown. Which one is winning over Hollywood?
The fight for Hollywood cash in the American Southwest has turned into the industry’s dirtiest turf war. Here, state reps come clean about their incentives program — or lack thereof — and whether their 2011 slates are expected to be heavy on big business or tumbleweeds.
Incentives: The Land of Enchantment offers a zero percent loan with a backend participation in lieu of interest for up to $15 million per project. The state also offers a 25 percent rebate on production and postproduction costs, including crew wages. Eligible productions include studio and indie features, regional and national television commercials, documentaries, animation, video games and webisodes with budgets of at least $2 million.
Showdown scorecard: With its straightforward and prompt rebate program (refunds are generally dispersed within three to four months of a production’s wrap), New Mexico is the clear front-runner in the Southwest’s incentives battle, attracting more steady Hollywood film and TV work than all of its neighbors. “We have a 100-year film history, but our 2002 implementation of incentives certainly enhanced our exposure,” says Jennifer Schwalenberg, deputy director of the New Mexico Film Office. “I think filmmakers have been surprised to learn we are the fifth-biggest state but have less than 2 million people. You can breathe here.”
Notable productions: Paramount’s best picture nominee True Grit; DreamWorks’ Cowboys & Aliens (July); Paramount’s Thor (May); USA Network’s witness-protection drama In Plain Sight; and AMC’s Emmy-nominated drama Breaking Bad, which is filming its fourth season on location in Albuquerque.
Bad stats: Ninety percent of the acclaimed drama series’ 120 crew members are locals; roughly 280 local actors have been hired since the show began in 2008; 180 locations have been rented in Albuquerque, Los Lunas, Rio Rancho, Corralles and Bernalillo; there have been 5,000 man-days of local extras and 30,000 man-days of local labor.
Fun fact: In 2004, New Mexico’s production revenue hovered at $12 million. In 2010, the state’s earnings skyrocketed to $202 million.
On the horizon: Despite its healthy workload in 2011 and heavyweights including Aliens director Jon Favreau keeping the state on Hollywood’s radar, New Mexico could someday see the sun set on its production monopoly: On March 2, a measure cleared the House that would cap the state’s annual film-subsidy program at $45 million starting in 2013. (Officials declined comment on the development.) But until then, things are still looking sunny, with Bad shooting until June and Disney’s Joss Whedon-helmed reboot of The Avengers, beginning shooting in April.
Contact: (505) 476-5600, nmfilm.com
Incentives: On Dec. 31, Arizona’s film-industry tax incentive expired because of a sunset provision end date, leaving the state with no program in place and the film community in legislative limbo.
Showdown scorecard: Despite its recent incentives woes, Arizona has long been considered America’s backlot because of its bounty of generic landscapes — dense urban sprawl, desert terrain, lush pine forests — and Anywhere USA vibe. Phil Bradstock, head of the Phoenix Film Office, says the state also has become a hotbed for reality series producers who have embraced the bleak economic times. “One that’s shooting here now is the WE network reality show Downsized, which follows families who are downsizing because of the economy,” Bradstock says. “These types of shows — HGTV’s Bang for Your Buck included — are the ones from which we tend the reap the most benefits. We’re also the fifth-largest city in America, have very diverse demographics and are a 50-minute plane ride from L.A. It’s very simple for these shows to come over for a week and then go home.”
Notable productions: The forthcoming indie dramas Queens of Country, starring Ron Livingston (March); Will Ferrell’s Everything Must Go (May); and the long-anticipated adaptation of Jack Kerouac’s On the Road, directed by Walter Salles and set for release this year. All three films shot in and around the Phoenix-Tempe-Scottsdale-Glendale area known to locals as the Valley.
Fun fact: There are more than 130 independent production companies in the Phoenix area alone.
On the horizon: At press time, the option to renew Arizona’s film incentives was on the Senate floor; if it passes, the legislation will move to the House. to be voted on in April. Until then, the film community is hopeful that taxpayers and legislators will look beyond the bleakness. “For years, our incentives helped the state compete as a major player in the Southwest, but last year the bill simply didn’t pass because it never got on the floor,” Bradstock says. “Having the word ‘tax’ in the name doesn’t help, but hopefully we can pass it again and really make known that bringing money into the state impacts everyone — not just the film industry.”
Contact: (480) 345-6464, azproduction.com
Incentives: Other than a hotel tax discount for stays of 30 days or longer, the state has no production incentives program in place.
Showdown scorecard: What happens in Vegas really stays in Vegas: The heart of Nevada’s production economy remains Sin City, which averages about 300 productions annually and has helped the state earn more than $2 billion in production revenue since 1983. However, with no incentives to entice big-budget productions, Nevada is feeling the sting. “We’ve lost many big projects, mainly to New Mexico, in the last four years because of the incentives war,” says Charlie Geocaris, director of the Nevada Film Office, who points to 2009’s The Hangover as the state’s most recent big-budget project. “We are surrounded by states that have programs, so we often have people come here to do second-unit work and just ‘fake Vegas’ but shoot elsewhere.”
Notable productions: History’s top-rated show, Pawn Stars. CBS’ Los Angeles-based series The Defenders and CSI shoot part time in Vegas.
Fun fact: Fifty-four reality projects filmed in Nevada in 2010.
On the horizon: The indie film The Motel Life, starring Dakota Fanning and Emile Hirsch, is filming in Reno.
Contact: (702) 486-2711, nevadafilm.com
Incentives: Texas’ program offers a 5 to 15 percent rebate, depending on the amount of in-state spending; a 6 percent refund on hotel room costs for stays of more than 30 days; and upfront sales tax exemptions on most items rented or purchased for direct use in production.
Showdown scorecard: Despite a résumé that boasts such hit films as Courage Under Fire and Traffic, West Texas’ film headquarters of El Paso has seen its profile shrink against the incentives competition.“It’s been a slow couple of years,” El Paso film commissioner Susie Gaines says.
Notable productions: Indie film The Dry Land, starring Melissa Leo and America Ferrera, which debuted at Sundance last year; Discovery Channel’s Road Eats.
Fun fact: Despite its long-held reputation as a last vestige of the Old West, El Paso is now doubling more frequently for Northern Mexico because of recent violence in border communities.
On the horizon: El Paso has nothing on its 2011 production slate, but Gaines remains hopeful.“We’ve had five scouts here in the last six weeks, so that tells me we’ll get at least a few projects,” she says. “Hollywood knows who to call when it needs sunsets and highways that go on forever.”
Contact: (915) 534-0698, governor.state.tx.us/film