Home   News   Schools   Sports   Biz   Opinion   Health   Scitech  Arts   Dining   Movies   Outdoors   Weather   Comics   Archives  NM Jobs Cars Real Estate

          Front Page  opinion  guest_columns

Monday, November 09, 2009

Film Business Relies on Our Dime

By Rick Clemente
President, Production Central ABQ
          The New Mexico film rebate and loan programs have succeeded in creating a large and growing number of jobs and businesses here. Despite competing "economic impact reports," we can all agree that a new, clean industry is now thriving in New Mexico, mostly on other people's money from out of state!
        At what cost?
        The new policy of the state Film Office of providing annual "spending totals" by category will go a long way toward making the program more transparent and create real metrics for analysis.
        Future analysis must include the significant economic contribution made to the state by people moving here, building new businesses, opening brokerage accounts, buying homes, groceries, furniture, cars, etc., and paying property and gross receipts taxes. This economic activity is a direct result of the film incentive programs, but it is not reflected in any audit of eligible production expenses and represents economic activity that does not qualify for any rebate.
        The incentive programs were put in place to create jobs, businesses and infrastructure, not as an investment vehicle for state funds. It should be revenue neutral, which is probably about what it is; somewhere between the Earnst & Young "profit" and the Arrowhead Study's "loss" scenarios.
        Competition from other states is fierce. We can continue to prosper in this very competitive environment by leveraging the lead we now enjoy. We have a well-regarded work force, a substantial number of supporting businesses and infrastructure, a reliable film incentive program, and industry leading state and local government support.
        The film industry has been reluctant to make large capital-intensive investments in permanent facilities and equipment if the incentives (which are essential to the business) are subject to annual debate. Other forms of economic development (bonds, etc.) are voted on once and the deal is done.
        The Albuquerque Studios, Production Central ABQ and a few other enterprises are "brick and mortar" permanent facilities, but many more are required in order to create sustainable permanent industry here.
        What is needed in order for the full potential of the people's investment to be reached is an "evergreen" provision, such that any modification to the incentive program would take effect five years after adoption. This would encourage venture capitalists and developers contemplating a multi-million dollar investment in computers, sound stages, back-lot production facilities, etc. to go ahead and put in the money.
        Indeed, there are several major capital-intensive projects, both publicly announced and pending announcement, that are "on hold" awaiting a more solid legislative commitment.
        An additional change that would enhance the effectiveness of the program is to clarify the language regarding post-production and TV commercials so as to streamline the qualification process and reflect the original intent of the legislation.
        It is often suggested that a capping or any substantive reduction to the film incentive programs would kill the business instantly.
        Killing the business here would be a shame and a waste of the money already invested, and it would force the exodus of the fine group of highly trained professionals we already have here.
        Alongside the growth of the movie business in New Mexico there has been a parallel growth, and investment, in our education system, creating media curriculum and programs.
        The University of New Mexico and New Mexico State University now have multimillion-dollar film schools offering four-year degrees in various movie biz specialties. If the movie business were to be switched off, these educational programs would continue under their own unstoppable momentum. Many of our brightest kids would continue to receive very expensive film educations, mostly at our expense, but would then be forced to take their educations with them as they seek careers out of state.
        A hidden benefit of a thriving media industry here is the effect it has on the K-12 education system. When today's 10-year-old fifth-graders are adults, they will never read or write a business letter, as we know it today, nor will they have all-text résumés. These kids will prosper or fail in a mixed media world, where multi-media literacy will be a vital skill set.
        With the help of the movie biz, our schools have a head start on creating new programs that will realize their potential. Most of these kids will never work in the "biz," but the fun skills they are acquiring now will give them a lifelong competitive advantage.
        Ten years from now we can look forward to being at the top of the lists in "media literacy," if we play our cards right instead of 46th out of 50 if we don't.
        Rick Clemente is president of Production Central ABQ and North I 25 Studios, now hosting the third season of the Universal/NBC hit TV series "In Plain Sight."