With tax rebate comes more business, issues


NEW YORK -- No one in the film community is complaining about the annual $30 million, five-year "Made in NY" city tax rebate signed into law a few weeks ago. It's a major boon for New York's economy, but with a 35% jump in production last year alone, some questions remain: How will the city handle more increases? What will the impact be on filmmakers? And will it inspire yet another NBC spinoff: "Law and Order: Pet Detectives"?

Most everyone is quick to praise the Mayor's Office of Film, Theatre and Broadcasting and its commissioner, Katherine Oliver. "They're working very hard, especially Katherine," says GreeneStreet Films president John Penotti, "but they've been increasingly stressed. Their funding should be increased in proportion to the increase in production."

Some help is on the way. On July 1, four full-time workers were added to the mayor's office (bringing the staff from 15 in August 2002 to 23 today) and more production coordinators are expected to arrive in the near future.

But Penotti and GreeneStreet production head Tim Williams still have a few apprehensions. Williams has already seen the strain in neighborhoods like Greenwich Village, where he says high-income residents are quick to complain. He adds that it's getting harder for films with low to medium budgets to find crews amidst all the new shoots, but associate commissioner Julianne Cho says the production assistants training program addresses this and will help build the work force internally in New York.

Anthony Bregman, a partner in the company This Is That, says tax rebates are "the best thing to happen to New York film production since Thomas Edison." His only concern is what he dubs the "rebate cycle" he's seen in places like Canada. "You see production increase, and in a couple years everyone forgets it's what drew in business in the first place. So, over time benefits get reduced." For her part, Cho says: "The mayor is going to continue to demonstrate his commitment to the program."

The biggest cloud over the rebate euphoria is the revocation of free location scout parking tags. Everyone agrees they were abused, but many feel it throws out the baby with the bath water. "It was misguided and hastily done," Penotti says. "Instead of trying to fix a system, they just demolished it, and I think over time it will dilute the benefits of the tax rebates, especially when you're working on such a thin profit margin as is."

"It's a disaster," Bregman says. "On a $10 million production, you get about a million in rebates back, but there's a hit of about a quarter million in location parking costs." Cho disputes that figure, saying it's far from the industry average.

Williams says it is closer to five figures on his productions, but adds, "You're paying almost as much for parking as you are for a director." Cho counters this by citing its overall negative affects and says that scouts who use garages can apply the fees as a qualified cost for the tax rebates.

The end of this program has had some producers fearing the possibility of more changes, such as curfews, added parking limitations and the end of free police assistance.

Cho says this is all just speculation but doesn't rule out further changes. "New Yorkers have enjoyed new projects, new jobs and new services, so we're going to have to make decisions along the way that help manage the workload and balance out the equities to keep New York City open for business," she says. "We've demonstrated that we can do that over and over again."