Louisiana’s Film Industry Packs Needed Economic Punch
Thanks to the combination of unique culture, aggressive financial incentives, and developing infrastructure – Louisiana’s film industry is quickly becoming a critical economic engine for the state. According to state officials, 2008 film production in Louisiana has already exceeded $300 million and is likely to outperform last 2007 figures both in terms of total dollars and number of projects.
The news couldn’t come at a better time for Louisiana – a state that has worked hard to find ways to replace the losses in tourism that has hurt the state in the post-Hurricane Katrina era. This surge in Louisiana’s film industry is raising hopes it can be a catalyst for recovery and provide sustainable growth for the long term.
Some key facts about Louisiana’s film industry:
• More than $2 billion in productions have been filmed in Louisiana since 2002
• The total direct impact to Louisiana’s economy is $1.48 billion
• The percentage of film budgets spent in Louisiana has risen from 33% in 2005 to 87% for 2007
• Film-related jobs in Louisiana have grown at a rate of 23% per year
Source: Louisiana Film Office
Record Job Growth
The film industry in Louisiana is also turning out to be a major new employment sector with an increasing numbers of jobs and higher pay levels. The Louisiana film industry is growing jobs at a rate of 23% per year and Louisiana now ranks as the top production location of choice outside of the traditional hubs of Los Angeles and New York (ERA).
Jobs in the film sector require some technical skills and are considered “family wage jobs” meaning workers can earn enough to support a family. The growing workforce is being supported by various educational institutions many of whom are now offering film specific classes and programs.
Other film industry employment facts:
• Louisiana has grown its local film industry union labor (IATSE) to nearly 500 strong;
an approximate 200 percent increase since 2002.
• Louisiana payroll alone has averaged $40 million per year since 2003, totaling nearly
$200 million in payroll wages earned by Louisianans.
• Louisiana has well over 2,000 local residents working on projects in a variety of positions.
Source: Louisiana Forward
Success of Louisiana Film Tax Incentives
While Louisiana historically hosted its share of film productions – the film industry began to gain momentum in 2002 when the Louisiana State Legislature enacted its film tax incentive program. Early on these incentives attracted a number of made for TV movies. More recently the state has been able to recruit more “low budget feature films” which have typical budgets between $2 – $15 million.
Louisiana’s film investor tax credit program offers out of state production companies a tax credit equal to 30% of their spending in Louisiana during film production. The labor tax credit offers an additional 10% tax credit based on the amount of Louisiana labor employed during the production.
These film incentives have proven successful in creating a thriving and sustainable film industry in the state. This includes creating a strong capital base for motion pictures as well as longer term production and infrastructure development.
The program has also successfully attracted private investment for the production of motion pictures and developing the studios, production houses and support services to grow a native Louisiana entertainment industry.
Music and Television Productions
Louisiana’s incentive programs have also been successful in developing entertainment productions outside of just movies. Television shows, commercials, mini-series, reality shows, documentaries and music videos are all taking advantage of the increased ability to lower their cost through the credit program applications.
Among the success stories is Disney’s television series “Imagination Movers,” a series about the popular children’s band. This project represents the first major year round use of crews and studios at the Nims facility in Jefferson Parish (www.nimscenter.com).
Other television projects include:
• “Fox’s “K-ville” shot its first year’s pilot program at some of New Orleans more popular tourist settings.
• The Subway “Odd Couple” commercial staring New Orleans Saints star Reggie Bush was shot here.
• Warbirds, a Sci-Fi channel original movie was shot in the Baton Rouge area and recently made it’s worldwide television premier.
Key Infrastructure Developments
Not to be overlooked in the success of this young industry is the 40% infrastructure tax credit which has encouraged the development of much needed production support facilities. These new facilities allow film production studios to conduct more of their work in the state thus maximizing their “Louisiana spend.”
For example, high definition production suites include online and offline editing bays, a screening room, and an ADR (additional dialogue recording) suite are all being developed at the University of New Orleans (UNO) Robert E. Nims Center.
Also the Celtic Media Centre is currently building its $45 million Celtic Media Centre rental facilities which include an 11,000 square feet of stage space, 6,000 square feet of office space and 4,000 square feet of post production space. Future plans include adding 130,000 square feet for production and 68,000 square feet for offices.
Lower Cost of Doing Business
Louisiana currently ranks 26th on the Milken Institute’s “Cost of Doing Business Index” which measures the overall cost to do business in each state. These lower costs mean producers are able to better stretch their film budgets in Louisiana by as much as 30% as opposed to New York or California.
These lower costs translate directly the bottom line of film productions and impact everything from production studio rent to labor costs. Also with the lower value of the US currency many productions are coming here instead of Toronto, Vancouver or other popular spots in Canada.
Turn Key Production Partners
FBT Film and Entertainment (www.fbtfilm.com) is the only provider of Louisiana film incentive programs affiliated with a bank. Through our relationship with First Bank and Trust we are able to offer producers a full range of support services including:
• Budget analysis to optimize potential tax credits
• Banking relationships and deposit services
• Assistance with studio expansion and sound stage development
• Help finding local production affiliates
• Project insurance services
• Location assistance including private residences and 5 star hotels
• Obtaining state certifications for credits
• Introduce Louisiana audit, payroll and accounting professionals
• Maximizing the value/sale of tax credits
FBT Film is your “one stop shop” for all of your Louisiana production incentive services. Contact us today for more information about Louisiana’s growing film industry or its tax incentive programs.
ECONOMIC RESEARCH ASSOCIATES (ERA) STUDY 12/06
LOUISIANA ECONOMIC DEVELOPMENT
MILIKEN 2007 COST OF DOING BUSINESS INDEX
LOUISIANA FILM OFFICE