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Are MPIs putting Atlanta (and Georgia) on the filmmaking map?
After over ten years of movie production tax incentives (MPIs), Georgia may finally be reaping the rewards of their generous tax credits in the way of a local film industry growth. MovieMaker magazine just named Atlanta the number one city for filmmakers to live and work, and the 2013 employment numbers showed a nearly 100 percent growth from the previous year.
Atlanta #1 among big cities, and Savannah #1 among small ones
Atlanta was just named first among the “Best Places to Live and Work as a Moviemaker 2016: Top 10 Big Cities,” up from sixth last year, according to MovieMaker magazine this month, with Savannah coming in first among the top ten small cities (“Best Places to Live and Work as a Moviemaker 2016: Top 10 Small Cities and Towns“).
So Atlanta beat out New York, Austin, Los Angeles and Albuquerque, in the following four spots respectively. Chicago, Seattle, Boston, San Francisco and Memphis rounded out the top ten.
Atlanta’s top position was, according to the article, based on several key factors: generous 30% tax credits; a growing talent pool that increasingly includes directors and producers, as well as talent for larger on-screen roles; a hip-hop scene to rival New York and L.A.; good restaurants; affordable housing; and the fact that “217 days of the year are pure sunshine.” Another oft-mentioned factor, overlooked here, is the city’s Hartsfield Jackson International Airport, the busiest in the world.
Maybe more importantly, film employment has increased dramatically in the state. According to recent figures released from the Bureau of Labor Statistics, Georgia saw a 94 percent growth in employment in motion picture production and distribution, and a 187 percent growth since 2010.
Source: County Business Patterns
Looking at a comparison of Georgia and 11 other states with MPIs over this period, most have stayed rather steady over the 12-year period. Utah saw a large increase in 2013 as well, but this might be a statistical aberration, given the low-level of employment in all the previous years. California and New York were left off this intentionally, since both states’ much higher overall numbers obscure the differences in the smaller states, but neither showed anything like Georgia’s growth over the last few years.
This brings up a few questions: is this meteoric rise for Georgia due mostly to the state tax incentive, or are other factors at least as important? And given the success of the industry in recent years, are incentives still necessary going forward, or could they be reduced or eliminated? Time will tell, but as a recent Atlanta Journal Constitution article indicates, the state seems committed to continued support for the incentives.
Two recent presentations shed light on metro film jobs & the rise of Atlanta as a filmmaking mecca
It’s been a busy few weeks for me…
First, I traveled to San Antonio for my fourth Urban Affairs Conference. My presentation was a comparative study of 22 states offering movie production incentives (MPIs) over the last 10 years, with a special focus on the metropolitan nature of film employment. [see the complete presentation here].
Film industry employment is metro employment
San Antonio at Night
Besides showing that across states, an increase in film industry employment has a lot more to do with the level of existing employment — showing a path-dependent relationship — than with the level of tax incentives available, I was able to show that film jobs are heavily concentrated in metropolitan places. In a pooled sample from 2007-11, 94% of film industry workers lived in metro areas, with nearly half (43%) in the metros’ central cities. In addition, over half (53%) lived in the top 10 filmmaking cities, with nearly 40% of workers residing in the greater Los Angeles (*including Riverside-San Bernardino) and New York metros.
Top 10 Metros by Film Employment (Source: IPUMS ACS 2007-11 Pooled Sample)
In Georgia, nearly 90% of film industry jobs were in the 4 central counties of the Atlanta metro (Fulton, DeKalb, Cobb & Gwinnett).
GA Film Employment by County (Source: GA CEW data)
The rise of “Hollywood South”
Anyone who has lived, worked, or even visited Atlanta lately can easily recognize the signs: a line of white trailers, covered windows with adjacent scaffolding and lighting rigs, and the occasional celebrity/zombie sighting… all evidence of the recent growth in film & TV production in Atlanta and the surrounding area.
The auditorium @ GSU’s Centennial Hall
Yesterday I was fortunate enough to attend the Second Annual Atlanta Studies Symposium, held at the newly acquired and renovated Georgia State University Centennial Hall, formerly housing the Atlanta Life Financial Group. This is noteworthy because GSU has led the revitalization of downtown Atlanta, taking over former office towers and commercial spaces nearly as fast as their tenants could skedaddle to the northern suburbs. But I digress…
Amidst a great assortment of presentations on Atlanta past and present, I was on a panel that included research on the option of local, organic food for low-income urban families; and a look at the new trend in “open streets” programs in cities around the U.S. and beyond. I had tough acts to follow, but I persevered. Mine was the last panel presentation of the day, before the closing keynote by Regime Politics author Clarence Stone, so I felt some pressure to keep my audience awake so they wouldn’t miss hearing from this icon of urban politics. I was really wishing I could still make some changes to my PowerPoint, but I was forced to improvise a bit at the last minute when, just moments before the panel began, I received a tweet informing me of an article just released by The Hollywood Report entitled “How Georgia Toppled Louisiana in Attracting TV Productions.” Needless to say, I wanted to include this in my talk, so I found myself opening by reading quotes off my iPhone… [See my tweet/blog piece on this article shortly]
After giving a litany of recent productions shot in or near Atlanta in the last several months, including the Hunger Games series (all 4 films so far and counting); Anchorman 2, which had my beloved Manuel’s Tavern converted to a New York watering hole after replacing all the Atlanta sports memorabilia (and one naked portrait) with that of NYC teams; and of course The Walking Dead, whose popularity is such that after 4 seasons, it has spawned a cottage industry of TWD locations tours.
According to Georgia’s Film, Music & Digital Entertainment Office, nearly $1 billion was spent directly in the state in fiscal year 2013, generating an estimated $3.3 billion in economic impact. That’s an increase of $55 million from FY2012, and nearly a quarter of a billion since FY 2011, when the industry spent $689 mil. That is nothing to sneeze at. But of course they didn’t mention the cost of the program, which could be up to 30% of that direct expenditure, or upwards of $300 million from state revenues, since the tax incentives are based on the production budget, not the taxes owed. Producers are allowed to sell their excess credits, often heavily discounted, to other companies and individuals who owe Georgia state income taxes, which has spurred a new industry for brokers of such tax credits.
So given this growth in productions, what does that mean for the Georgia-based film industry? So far, it’s hard to tell. Based on the latest numbers I have (2011), film industry employment is at approximately the same level as it was in 2000, prior to the passage of a series of increasingly generous tax credits. There has been some growth since the bottom of 2004, following the passage of the first film tax credits in Louisiana, but the biggest spikes come immediately after increases in the credits, and then drop and/or level off (see the chart below).
Film Jobs in GA, 2000-11 (Source: GA CEW data)
Occupational data looked a bit more promising, but while the four major film & television occupations showed growth overall, only the largest and least production-specific group — Audio & Video Equipment Technicians — showed actual growth. (see the following chart).
GA Film Production Occupations 2000-12 (Source: Bureau of Labor Statistics)
In short, the last 2 years may in fact tell a different story, but in the mean time, I think we should be asking some tough questions about how this program is working, and whether it is really benefiting Georgia taxpayers, or even Georgia filmmakers.
Inequality in the Creative City
As you may know from my previous post, last week I attended the Experience the Creative Economy Conference in Toronto. One topic of the “Small Group Chats,” — four 30-minute open-ended discussions repeated on two consecutive mornings — was on “Inequality and the Right to the City.”
During the session, I alluded to one of my favorite quotes from Dietrich Bonhoeffer, a pastor who broke from the German Lutheran Church over opposition to the Nazi regime, and who ultimately was executed for his role in a failed assassination plot on Hitler. In his essay “The Church and the Jewish Question,” he said that our role
“is not just to bandage the victims under the wheel, but to put a spoke in the wheel itself.”
As biographer Eric Metaxas1 notes, this is an awkward translation, but it is generally understood to mean that we must stop the wheel of injustice by jamming a stick in it, which is a pretty radical way to stop a wheel, as you know if you’re a cyclist like me (does anyone else remember that harrowing race scene in the 1979 classic Breaking Away?). My interpretation is that the two approaches are not either/or, but both/and. It is not enough to merely bandage the victims, nor should we ignore the victims while we continue in the larger task of spoking that wheel of injustice.
Applied to the issue of inequality, this means battling it at both the micro and macro levels. Much of the criticism of the move toward more creative work is that it seems inevitably tied to increased levels of inequality. First, it is important to note that to some extent, the increase in wage inequality is a statistical problem; if incomes rise for some, even if all do not benefit, those at the lower end of the income scale are not worse off in absolute terms because others are doing better. Income is not a zero-sum game, after all, but I do not wish to get bogged down in the debate about relative vs. absolute poverty today, though it is a legitimate debate.
Another realm of urban inequality is spatial. Gentrification and the resulting displacement of economically disadvantaged residents is a common outgrowth of an increase in creative workers, especially in the central cities of the U.S. where a blend of federal housing and transportation policies and private market forces led to “white flight” and the great suburbanization of the post-war period. But as Jane Jacobs and others have pointed out, the city is a constantly changing organism, and displacements are an inevitable result of the spatial equivalent of Schumpeterian “creative destruction.” Here is where I want to revisit Bonhoeffer: rather than blindly battling urban redevelopment, we should be fighting the root causes of inequality, while simultaneously aiding those victimized by a broken system.
From a policy perspective, this means seriously addressing the issue of residential displacement by both slowing down the sometimes rapid rates of neighborhood transitions with strong laws protecting both renters and owner-occupiers such as some kind of rent stabilization2 and/or property tax relief for owners and landlords catering to the long-term residents. At the same time we need to work on the causes of increasing inequality and decreasing social mobility.
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