Film industry scoffs at B.C.’s new arts strategy
February 1, 2013
Peter Leitch insists Hollywood film and television industry executives have a soft spot for B.C.
The North Shore Studios president says companies such as Warner Bros., NBCUniversal and 20th Century Fox enjoy filming in the province for any number of reasons. The great crews, excellent infrastructure and diverse geography of B.C. - along with its convenient West Coast location – make it a favourite for many key California film industry decision makers.
But it’s a bottom-line-driven business, and if those same executives can save money by filming in Ontario, Quebec, North Carolina or Louisiana, that’s exactly what they are going to do.
“Those guys are basically begging us to get more competitive, because they want to come up here,” Leitch said. “They’re saying, it looks like we’re going to take this project to Toronto or Montreal. Is there anything you guys can do? Is the PST coming back for sure?’
“At this point in time, we don’t have any good answers.”
B.C. film and television industry leaders clearly didn’t get the answers they were hoping for on Thursday when the provincial government announced a new strategy to boost B.C.’s creative sector.
A new non-profit society – Creative BC – will consolidate the responsibilities of the B.C. Film Commission and BC Film + Media when it begins operations in April. It will work with film and television, digital media, music, publishing and other creative sectors to identify new growth opportunities.
Community, Sport and Cultural Development Minister Bill Bennett also announced Thursday a $6.25-million package of funding programs to promote the greater engagement of young people with the arts.
One angry film industry worker stormed out of the Vancouver Art Gallery where Bennett made the announcement.
“It won’t save 25,000 jobs,” said Patrick Stark, 45, who has worked in the industry for more than 20 years. “I’m all about education and the arts, but you are going to create a lot of diplomas and degrees and these kids are going to come out of school with no jobs.”
Bennett said he sympathized with the film industry, but doesn’t feel more tax credits will solve the problem. He said it would cost the provincial government $100 million to match Ontario’s tax credits, a figure he confirmed won’t be set aside in the February budget.
Bennett said $1 million in funding earmarked for Creative BC will help the industry work with government to find other solutions, adding he doesn’t think the government is “fully capturing all the revenue or tracking all the revenue that comes from the film industry.”
Work-starved film and television industry employees throughout the province were desperately looking for more tax relief for the B.C. sector so it can compete more effectively for new production business.
B.C.’s 33-per-cent tax credit on film industry labour costs has been trumped by the more attractive 25-per-cent credit on all production costs offered in Ontario and Quebec.
That tax advantage helped Ontario overtake B.C. as the third-busiest film production centre in North America in 2011 — with $1.26 billion worth of production, compared with $1.19 billion in B.C.
The 2012 numbers aren’t in yet, but Leitch expects more of the same, as production at his North Vancouver facility has dropped by about 40 per cent so far this year.
“Things will pick up, but we fear that if we end up being 25-per-cent down for the year in B.C.,’ see a serious erosion of infrastructure, and a lot of people wont be able to pay their mortgages,” he said.
The B.C. film industry is expected to take another hit on April 1, when the province reverts back to the provincial sales tax. HST tax credits saved the industry an estimated $20 million to $25 million a year and a return to the PST will drive up production costs, Leitch argued during the 2011 referendum campaign on bringing back the PST.
The province’s film and television production industry directly employs some 25,000 people and supports about 15,000 other jobs.
International Alliance of Theatrical Stage Employees representative Paul Klassen said his union’s payroll figures reveal a 30-per-cent drop in employment in the second half of 2012, compared with the same period in 2009 – the most-recent “strong” year for the B.C. industry, when more than $1.3 billion worth of production took place.
Klassen said the B.C. industry risks being dismissed at the budgeting level for new productions considering various locations.
“If you’re in Los Angeles and decide to make one budget for Canada, one for Louisiana, one for California and one for Australia, where is that budget for Canada?” he said. “It used to always be British Columbia, but now it’s almost always guaranteed to be Ontario or Quebec.”
Bennett recently indicated some figures show that film jobs actually cost the government money, but said those figures are being reviewed. Leitch said the province and the industry have to gather more economic data to determine just how important the industry is to B.C.
“It’s new dollars coming into the economy – big dollars that are spread throughout the economy instantly,” he said.
Leitch isn’t suggesting that B.C. match the tax breaks in Ontario and Quebec, but he feels that closing the gap from the current 10-per-cent advantage those provinces have over B.C. to just five per cent would boost business significantly.
That might be achieved by increasing the B.C. labour tax credit and by exempting film and television production costs from the provincial sales tax when it returns in April.
“We just need to get halfway there, between where we are now and where they are in Ontario and Quebec,” Leitch said. “Then the rest of the advantages we have will shine through and business will boom again.”
Klassen said Canadian productions almost have a built-in bias for filming in Ontario and Quebec, because that’s where many decision-makers are based.
“So if you want to pitch a new television series to CBC or CTV or Global or whoever, the chances of doing that in Ontario are greater because the people who make those decisions are there,” he said. “That’s why so much domestic production has shifted there.”
More than $852 million worth of domestic production took place in Ontario in 2011, a 32-per-cent increase over 2010. B.C. had just $209 million of domestic production in 2011, a 14-per-cent drop from 2010.
Canadian Media Production Association representative Liz Shorten said the B.C. industry could develop a more diversified client base by attracting more domestic productions, and noted that despite the many problems now, sectors such as animation and visual effects continue to thrive in the province.
She also stressed that B.C. can capitalize on the trend of more people watching content on mobile devices such as iPads and other tablets.
“We want to produce content that gets viewed on those devices – video content, webisodes, short interactive pieces,” Shorten said. “We can do that here in B.C.“
Okanagan Film Commissioner Jon Summerland said the fledgling film production sector continues to grow in his part of the province, with producers spending about $10 million there last year, up from $7 million in 2011.
“Film isn’t going to disappear from B.C.,” he said. “We just have to work hard at getting it back. We’re still a great place to film, and I’ve never had a client leave and say they hated their experience in B.C.“
Source: Vancouver Sun