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While the state claims to chase jobs, Tennessee's film industry starves

State of Anxiety



There is an oft-told movie-industry joke that gets more groans than laughs: The first page of every script should start with an establishing shot — "Exterior: Tax Incentive State."

At this point, it's more truth than kidding. States such as Michigan, Louisiana and neighboring Georgia that offer lucrative tax incentives are the most likely locations for a film production, regardless where the movie in question is set. For the local film community, though, the quip cuts even deeper — as a reminder of the increasingly long odds that such a shot will feature an actual Tennessee locale.

As chronicled last year in a Scene cover story ("The Money Shot," Feb. 17, 2011), Tennessee's film workers have watched in recent years as films that should have been shot here took their lights and cameras to states more kind to their bottom lines. Even the dirt-cheap backlots of Central Europe have subbed for Tennessee on multiple occasions. In light of everything that could or should have been, the occasional successes — last year's Country Strong, or more recently the Nashville-shot Nicole Kidman psychological thriller Stoker — have offered little comfort.

With the state legislature back in session, local film workers and industry advocates are renewing their push for an incentives package that might reverse the trend. At stake, they say, is not just the boon to state and local economies when in-state stories are kept at home — or outside projects are reeled in — but also to Tennessee's crew base, which is said to be shrinking as workers follow the work.

As they did last year, members of the local film community will meet to discuss the matter — though this time they'll have more specifics to mull over. The lobbying organization Association for the Future of Film and Television in Tennessee (AFFT) has called a meeting at 1 p.m. Monday, Feb. 20 at The Belcourt and will hold a rally on the steps of the Capitol the following day. Most prominent on the meeting's agenda is a bill that supporters hope will allay the state industry's concerns.

Currently, Tennessee offers cash rebates of up to 32 percent of the money a production spends in-state. The rebates come from an incentive fund provided for by the 2006 Visual Content Act, which once held $20 million but has dwindled in the years since.

As proposed, the legislation on the table now — HB 0555 in the House, SB 0354 in the Senate — would among other provisions offer transferable tax credits of up to 20 percent (with a cap of $5 million) to projects spending a minimum of $500,000 in-state. Because Tennessee has no income tax — the most common vehicle for film incentives in other states — the credits would be applied instead to sales and excise taxes and franchise taxes.

As filed last year, the bill would cost the state an average of $25 million a year, for five years, in decreased revenue — though the idea is that the resulting productions (and the additional spending that comes with them) would more than offset the loss. Still, AFFT founder Jan Austin, a deputy to Bredesen-era Tennessee Film, Entertainment and Music Commission chief David Bennett who was instrumental in the bill's formation, tells the Scene that her group has devised amendments that would whittle the number down to $10 million a year for four years. In a nod to other local interests, Austin says, it will strengthen parts of the bill that affect the music industry as well. The proposed changes to the not-yet-filed legislation will be up for discussion at the Belcourt meeting.

While Tennessee has been cash-strapped in recent years, revenues have begun to recover, however slightly. Given Gov. Bill Haslam's recently proposed increase in the estate-tax exemption — which would affect approximately 200 estates statewide and decrease the state's revenue by $14 million a year — Austin says she refuses to be told that the state can't find $10 million to benefit an entire industry. Moreover, the legislation is aimed at an issue that is supposedly Priority No. 1 for the governor and state legislators on both sides of the aisle: jobs — both keeping them and creating them.

"Some may see it as job creation, some may see it as job retention," says state Rep. Steve McManus, the bill's House sponsor, who serves production-friendly Shelby County. "But either way you look at it, jobs here are leaving, people are leaving the state that are in this professional business to go to site locations out of state."

It's hard to nail down just how many jobs and workers have been lost to states with more attractive incentives — not unlike those the Haslam administration says have fled the state to avoid the estate tax. But the anecdotal evidence piles up quickly. In a recent Facebook post, Austin says, she asked industry friends if they knew any film workers who had left the state permanently because they couldn't make a living wage in Tennessee. Within a day, she says, she had a list of more than 150 names. She sent them to the governor.

Oscar-nominated sound mixer Peter Kurland also bears witness to the reluctant exodus of Tennessee film workers. The president of the local International Alliance of Theatrical Stage Employees, and the only technician to have worked on every Joel and Ethan Coen film dating back to 1984's Blood Simple, Kurland has his reservations about the incentives race between states and the vicious cycle it can create — a sentiment shared by many. But he also says that protecting and attracting work for the state's crew base is vital if the state wants to keep it.

"I'd be remiss if I didn't say that, in the short run, Tennessee has to be able to compete so that we don't lose our film community," Kurland says. "There are a lot of people who are kind of straddling the fence between Tennessee and Georgia. Their families are in Tennessee and their whole history is in Tennessee, so they don't want to live in Georgia permanently."

For all practical purposes, it's an arms race. And while Kurland and Austin both acknowledge doubts about the sustainability of the incentives game — fire-sale incentive states such as Michigan and Louisiana have already experienced some sticker shock at the price of doing business — they also note the reality of Tennessee's current predicament: Either stock up or get left behind.

"In the short run, it is necessary for Tennessee to compete to maintain its fair share of the work," Kurland says. "In the long run, we need a new paradigm that allows movies to be made where they are best set creatively and artistically. Then Tennessee will have more than a fair fighting chance for work, because so many of these projects are Tennessee stories, in Tennessee places, with Tennessee music."

Just so there's no misunderstanding, Kurland elaborates: "If somebody goes and they make a movie about the Atlanta Falcons and they want to make that in Atlanta. I don't want to fight Georgia for that. But if we're making a movie about something that happened in Memphis or Nashville — I want to see that shot in Tennessee."

With regards to a paradigm shift, veteran Nashville filmmaker Curt Hahn, whose locally set and locally shot film Deadline hits Middle Tennessee multiplexes this Friday, tells the Scene he has an idea that will give Tennessee a way out of the incentives standoff yet help it acquire the Third Coast standing it has long desired. Though he's not ready to share the plan in detail, he says it's a program that borrows from the model currently being used for the state's TNInvestco program, which allocated $200 million to various venture capital firms with which to invest in small and start-up businesses across the state.

For now, besides the lure of its locations, crew and amenities, the only cards in the state's hand are what's left of the existing incentives fund — approximately $10 million, according to Office of Economic and Community Development spokesman Clint Brewer — and the provisions in the proposed legislation. With the state film commission's remaining staffers now folded into ECD, Brewer insists the state will "continue to work with stakeholders in the film industry" as his office considers "how to incentive the film industry in Tennessee at a price that makes sense for taxpayers." Describing a meeting she and the bill's sponsors attended with Haslam's ECD Commissioner Bill Hagerty, however, even the resolute Austin sounds less than optimistic.

"It was made abundantly clear by [Hagerty] and his staff that they were not in support of incentives for film, TV and music," she says. In states where incentives efforts have paid off, she notes, the film communities relied heavily on support from their governor.

"We are at the mercy of the administration's goodwill," Austin says, "and we are not feeling a lot of goodwill."


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