Film subsidies bring benefits

By WARD EMLING,

Note: This is a response to a column in the February 21 Northside Sun by Brett Kittredge, director of marketing and communications for the Mississippi Center for Public Policy.)

It continues to amaze me that people whose job it is to think and to equip the public with information and perspective, cannot seem to grasp the value and impact of the film industry in Mississippi. The film industry is not about movie stars and cameras; it is about direct career and financial opportunity for hundreds of Mississippians, and both direct and indirect community and business opportunity for thousands more. The film industry today presents the clearest and quickest career entry, promotion, and upward mobility of any industry we presently attract and support. And it is an industry that has been on the upswing globally for at least a decade, creating more product and more jobs year over year at an unprecedented rate.

Add to that reality the fact that at least a dozen Mississippi community colleges and universities presently offer film industry training and curriculum, and it is clear that the film industry is exactly the type of industry that should be one of our targets for economic development through incentives, workforce training, and infrastructure. Which is exactly what we created in 2004 with the Mississippi Motion Picture Incentive Program: a single incentive program that offers business incentives to an industry that in turn creates local wealth, workforce training, and infrastructure development, not to mention public relations and marketing opportunity.

Unfortunately, in July 2017, the legislature allowed a crucial component of that incentive, the rebate for non-resident cast and crew, lapse. The result of that has been catastrophic for the Mississippi film industry, accounting for an exodus of workforce, loss of personal and business income, and the shuttering of almost a dozen support service companies. In 2016, the annual payroll for Mississippi cast and crew working in the film industry here at home reached an all-time high of $6.615 million. That payroll dropped to $2.9 in 2017, and last year dropped to $1.3 million.

Those who champion the cessation of incentives to the film industry live in a ideological vacuum and a database of inaccurate and incomplete information, refusing to recognize the broad-based individual and community impact of the film industry on everyday Mississippians. I once heard a state economic development agency executive explain the film incentive program as “…good for the community, but bad for the state...” Those working in traditional economic development have never ventured out to grasp the impact of an industry that reaches into every sector of the state’s economy and out to billions of eyeballs and screens around the world.

These people and organizations justify their stance by quoting a number from two pages of a 52+ page report by the Performance Evaluation and Expenditure Review (PEER) Commission released in 2015. (In fact, it is on the ninth page of the executive summary, which perhaps means many didn’t get to the full report.) The reported return on investment number of 49 cents for every incentive dollar spent was based on general and incomplete information that at the time was almost a year old and was based on traditional economic development methodology, not taking into account multiple areas and levels of related spending during and between productions. Historically, film impact reports across the country have wrestled with (and lost) the labor-intensive chore of discovering the deep, pervasive, and incalculable spending of productions and their hundreds of workers on location.

In 2016, in addition to a PEER-suggested deeper collection of data, we proposed a subsequent financial impact study to look at the data production by production and year over year, providing a more accurate picture not just of the return on investment for a specific production, but a graph of the effectiveness of the incentive over time…to show over time the impact of the incentive program in the building of infrastructure and workforce. Which is after all the reason for an incentive in the first place: to create the environment for the attraction and development of an industry, creating opportunity for the citizens and the communities of Mississippi, and therefore raising the profile and economy of our state.

 

In their financial review of “The Help,” a film at the beginning of our more recent wave of production and before the state had a base of experienced crew and production support services, the state economist’s office determined our return to be 56 cents without even considering the incalculable impact of (1) personal spending by the cast and crew, (2) publicity and tourism created during and after production, and (3) permanent industry, community, and civic development. As the PEER Committee pointed out in their report, even though just at the beginning of creating the workforce and infrastructure necessary to fully realize the impact of the incentive, the state was effectively competing globally, building resources and awareness, and had crafted an incentive that was the most effective of all of the states they studied. And as stated above, the value of any incentive program should be gauged by (1) the increase of its effectiveness to attract an industry, (2) its development of the infrastructure and workforce necessary to support the industry, and (3) the impact on the general wealth and well-being of Mississippi workers and communities. The data is clear: we went from four feature films made in 2012 to 15 made in 2016; over the same period, we went from a local Mississippi payroll of $615,000 to $6.6 million; and our crew database grew by more than 40 percent to over 900.

To put things in perspective for a traditional economic developer: From the inception of the incentive program in 2004, Mississippi has paid out $34.5 million in incentives and created $206 million of in-state production: $5.97 of production for each $1 of incentive. And, unlike in traditional economic development projects, every one of those $206 million film production dollars first went into the economy of the state, rippling there for as many as 18 months, before the incentive was even paid out. And, while I have my calculator out: for the $1.4 billion dollar Continental Tire plant, the state approved at least $596 million in bonds, exemptions, and incentives: $2.34 for each $1 of incentive.

The impact of an incentive program, and the industry it attracts, is frequently in the eye of the beholder, or the hands holding the shovel or scissoring the tape. But an objective look at the incentive and the results of its implementation should be the focus of our attention, not a headline or a photograph or page nine of an executive summary. And perhaps, even more, have a conversation with the people and the communities themselves.

Just ask Laurel…and Greenwood…and Canton…and Jackson…and Oxford…and Gulfport…and Hattiesburg…and…well, just ask around.

Ward Emling was the director of the Mississippi Film Office from 1980-1983 and 1990-2017, retiring as the longest serving state film commissioner ever.

 

 

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