Location, Location, Location
Alabama’s incentives for moviemakers have been so successful the $15 million cap on them will probably be reached in the first quarter, gobbled up by two big productions.
Actor Nicolas Cage (center) on the streets of Mobile during filming of “Tokarev” in 2013.
Photo by Dan Anderson
Of all of Alabama’s business-luring incentive programs, one of its newest, the film incentive, is perhaps the most successful in terms of providing an economic bang for the buck.
The state Film Office estimates the incentives brought in $33 million in new business in 2012 and provided 3,000 jobs. While the figures for 2013 haven’t been reported yet, the budgets for productions based out of Mobile alone totaled more than $30 million for the year, according to Eva Golson, with the Mobile Film Office. Productions shot in Mobile since 2010 had a combined budget of $72 million, most of which funneled into the state’s economy.
Golson lobbied state legislators to enact an incentive program to help Alabama compete with other states trying to attract Hollywood money. Golson saw what a production could do for a local economy as early as the 1970s, when Steven Spielberg shot much of the sci-fi classic “Close Encounters of the Third Kind” in the city.
But for more than 20 years, her pleas fell on deaf ears.
“Every state around us had their incentive legislation passed by 2001 and we didn’t have it. So we didn’t have a lot of production. I would try to attract productions and while they loved the locations we had to offer, they’d say, ‘Don’t call us until you have incentives,’” Golson says.
“We didn’t get ours passed until 2009 and I tell everyone the reason they finally passed it was they wanted to shut that old woman in Mobile up. I just kept saying to them, ‘What is it you don’t understand?’ You don’t give them the incentive money until after they’ve spent their money here, then you give them a percentage of it back. We can’t lose.”
The Alabama film incentive, passed by the state Legislature in 2009, provides tax credits and other rebates of up to $15 million a year to qualifying productions. The credit is available to any production with a budget in excess of $500,000, including television series, music videos, documentaries and major Hollywood movies. In addition to exemptions for various sales, use and lodging taxes, productions also are entitled to a rebate on 25 percent of production costs, plus 35 percent of payroll paid to Alabama residents.
The incentives are credited with attracting the blockbuster Jackie Robinson biopic “42” to Birmingham in 2012. In 2013, Mobile hosted productions for the Bruce Willis vehicle “The Prince,” Kate Bosworth horror flick “Somnia,” the Nicolas Cage movie “Tokarev” and a thriller called “Convergence.” In addition, the incentives attracted the “Sweet Home Alabama” reality show crew back to the Eastern Shore of Mobile Bay for a fourth season.
“The Sweet Home Alabama people, they spent a lot of money here. A lot,” Golson says. So did the other productions. For instance, “Tokarev” producers paid for a total of 2,335 nights in downtown Mobile hotels, according to Golson.
“They wanted everyone within walking distance of the set, so they put everyone up during shooting in our downtown hotels,” Golson says. “The other productions did that as well.”
Other local businesses felt an economic bump, as well. For instance, Pete Blohme, owner of Panini Pete’s in Fairhope and downtown Mobile, catered some movie functions and fed a lot of celebrities and crew during their off time, which amounted to invaluable advertising.
“The indirect benefit of having some of the celebrities in town tweeting about us was just great. We got some great tweeting from Kate Bosworth. John Cusack was tweeting about Moe’s Barbeque. You know, that puts butts in the seats big time. And any of the days they were filming nearby, that would draw a big crowd to the area, and we’d have a full restaurant,” Blohme says. “More than that, I saw a lot of my former employees getting jobs on the sets, doing something they loved. They’d tell the crew, ‘Oh you’ve got to go to Panini Pete’s’ or wherever, and that indirect impact for the whole community is just fantastic.”
But that kind of boost may be a little more rare this year. While the incentive cap was increased from $10 million to $15 million annually in 2013, the industry has grown so quickly in the state that officials predict the entire 2014 incentive package will be used up in the first three months of the year. What’s more, officials say, the whole $15 million may go to just two productions set to film in the early part of the year.
“We’re just insanely busy now. What’s happened, they’ve fallen in love with Mobile,” says Kathy Faulk, head of the Alabama Film Office. “‘Tokarev’ had two executive producers, and now both of them want to bring projects. The same thing has happened with the producers of the ‘Prince.’ They love our process, our locations, our people. Some crew members are actually relocating to Mobile because there is so much work there. That’s what happened in Louisiana, in New Orleans. They see Mobile as a little New Orleans.”
The state’s incentive package will grow to $20 million annually under the amendment passed by the Legislature in 2011. But for 2014, Faulk says, it looks like the state will be unable to accommodate all of the productions that want to shoot here.
“They’ve discovered us now, and they love shooting in Alabama,” Golson says. “It’s friendly, the weather is great. They’re competing to work here, so much that we’re going to run out of incentives.”
Golson says a lot of states have been forced to abandon their incentive programs because they didn’t ensure they had enough funds to pay promised rebates.
“You must have a pool of money for payback. A lot of states didn’t think about that ahead of time, and they’ve had to close up. That’s good for us, as we have a pool,” Golson says. “However, with the cap on it, I’m afraid the money for the whole state will be completely gone in the first three months of the year. We’re talking to three big productions, and I think two of them are going to take the whole incentive cap.”
The 35 percent rebate for using Alabama residents in the cast and crew has resulted in thousands of high-paying jobs, with locals handling everything from special effects to location scouting and even speaking roles.
“What I do, a production contacts me, I take them to locations where they might like to film,” says Andi Sowers, a longtime Mobilian and location manager for “The Prince” and “Tokarev.” “If its film-friendly, then we make a deal with the owners, set up time and location and get it ready.”
Getting a location ready involves set decoration, art direction, electrical work, coordinating with city officials and police, handling traffic and parking and a host of other challenges. And almost all of the work ends up being done by area residents, not to mention fees paid to the location owners.
“Pretty much everyone I know in the industry in the Mobile area, they were all working on these productions this year,” Sowers says. “They bring a few people in from other states, but they are trying to hire everyone else locally, which is nice because it trains us up to work on these bigger productions that are coming. We’re building a strong local crew.”
Sowers says the incentives play a crucial role in helping keep the production jobs in Alabama, because local crew members cost the production 35 percent less than out-of-state crew thanks to rebates. And, she says, the producers and production managers just seem to love working in Alabama.
“I’ve heard nothing but 100 percent positive from everyone I’ve talked to,” Sowers says. “My personal experience watching crews come in, they always want the local restaurants to feed everyone. They always spend the money where they are. They stay in the local hotels, eat at the restaurants, hire the local security companies, the trash companies, they use the local vendors for everything. It really shows up. I can see that money getting recycled around into our community.”
Faulk echoes that sentiment and says her agency plans an economic impact study.
“Several hundred people converge on a community. They are renting things, they are going out to eat, they go buy clothes, they go to the drugstores. They spend a lot of money when they are in town, and Mobile has definitely felt that,” says Faulk. “We just don’t have any numbers yet.”
Ben Raines is a freelance writer for Business Alabama. He lives in Fairhope.