New York Gov. Andrew Cuomo tonight unveiled a state budget that includes a three-year extension of the state’s film production tax credit. Launched in 2004 and extended by Cuomo in 2013, the $420 million-a-year program isn’t set to expire until 2019 but was expected to run out of money later this year without the additional funding provided for in the new state budget. An economic impact report conducted for Empire State Development, the state’s economic development arm, found that in one two-year period – 2013 and 2014 – the program had created more than $5 billion in spending in the state, generated nearly $10 billion in total spending throughout the state’s economy, created more than 60,000 jobs and $3.3 billion in earnings.
Many in the state’s booming film and TV community had urged the governor to extend the program, including the New York Production Alliance and the DGA.
“The Directors Guild of America applauds Governor Cuomo for his continued leadership, and thanks him for including a three-year extension of the Empire State Film Production Tax Credit in his budget,” the guild said in a statement. “The positive impact of the incentive on the economy, jobs and local business is enormous. Between 2005 and 2015, as production increased by more than 300%, the earnings of our members who live and work in New York’s communities grew 350%. This simply would not have happened without the incentive.”
The program’s extension also will be good for businesses like Kaufman Astoria Studios, which boasts the only studio backlot in New York City. “The governor’s support of the tax credit is a great economic policy,” said Hal G. Rosenbluth, the studio’s president and CEO. “The tax credit, combined with New York’s great talent, drives the $9 billion production industry in New York. The industry creates in excess of 100,000 high-paying jobs and spends millions of dollars in the local community for goods and services. Having the tax credit in place encourages Kaufman Astoria Studios and its counterparts to invest in building new infrastructure to service and grow the industry. With this extension of the tax credit the governor has established a win-win for the economy.”
SAG-AFTRA said that it too is pleased with the extension and the jobs for performers it will bring to the state. “SAG-AFTRA is grateful to Governor Cuomo for his leadership in recognizing the substantial economic benefits this tax incentive program brings to New Yorkers,” said Mike Hodge, president of the union’s New York local. “Film, television and other productions now create over 140,000 SAG-AFTRA-covered entertainment jobs every year in New York. The proposed extension of the tax incentive program, combined with the extraordinary talent of our local members, will ensure that producers continue to invest and thrive here.” Source: http://deadline.com/2017/01/new-york-state-film-incentives-program-extended-1201888655/
Judith M. Strazzera has been working in the film industry for the last 19 years after starting at 23 in Glendale, CA at a production facility working with major studios as their account representative. She then moved through the production facilities and managed edit bays and worked with creating theatrical trailers and teasers and helped process the QC, Editing Telecine, Digital Restoration and Film Lab processes for major features and independent projects. Eventually, Judith transitioned into Dispatching/DOT Administration where she worked for a number of projects before landing in Production Accounting, where she continues to work consecutively. Judith became involved with PaFIA after moving back to Pittsburgh, PA while working on several films. There she saw the direct rewards of the film tax credit to both her own livelihood and to the state. “The film tax credit means that more projects can get made that might not, due to budgetary concerns,” explains Judith. “The film tax credit allows for projects to receive rebates and credits and apply that money to the overall budget, while the state that is being filmed reaps the monetary benefits for the retail, real estate, hotel, rental car, travel and restaurant industries. The film tax credit levels the playing field for more projects to be made and has the added benefit of more locations and community benefits.”
Judith encourages other PaFIA members to network with other members and continually speak about the positive impact of the benefits of the filmmaking on the local PA communities. She emphasizes:
Happy New Year. I wish you all a happy, healthy and prosperous 2017.
The House and Senate started a new two-year session on Tuesday, January 3, swearing in all 203 House members and 25 Senators. The 2017/2018 session that lies ahead will have many challenges, most notably the same one that has plagued this Commonwealth in recent memory – the budget.
By the time the current fiscal year ends on June 30, many are predicting close to a $2 billion budget shortfall that will need to be addressed. What makes up the $2 billion? Annual carryforward pension costs, Medicaid spending and revenue expectations that were below projections, including the $100 million in revenue that was budgeted for internet gaming that was not approved.
So, what does that mean for Pennsylvanians, and more specifically the film industry? A few significant things. While the Governor has stated publicly that he will not seek a broad-based tax increase (i.e. income or sales), I am sure those options will be debated among legislators. An increase in either of those taxes is the only realistic opportunity to generate year over year revenue into the annual budget. One-time opportunities are limited, and many have already been exhausted, like liquor privatization. The direct and REAL challenge and concern will be budget cuts. And this year, ALL tax credit programs will be under the microscope – including the film tax credit. The possibility of the program being impacted is real and PaFIA membership will need to become more engaged and contact their local State Representatives and Senators. PaFIA's leadership is monitoring the situation and will develop a strategy to responsibly and effectively communicate to elected officials the importance of the film tax credit to the industry as well as the individual members and businesses.
First and foremost, Happy Holidays to everyone. Pour yourself a glass of holiday cheer and drink up before reading the following state budget update.
Good. Are you feeling warm and fuzzy? Things a little blurry? Well things are blurry in Harrisburg these days as well.
In approximately 45 days (on February 7), Governor Wolf will give his third budget address. And in a little more than 6 months (the June 30 budget deadline), the House and Senate will hopefully be debating and passing a balanced budget. Pennsylvania residents concerned about the state’s fiscal health probably would have preferred a lump of coal for their Christmas stockings rather than the troubling financial report handed down last Wednesday, December 14. According to the mid-fiscal year assessment by Budget Secretary Randy Albright, Commonwealth revenues will be at least $600 million short of paying for current budget year spending. The Legislature’s nonpartisan Independent Fiscal Office projects a $1.7 billion deficit for the 2017-18 fiscal year that begins July 1.
Part of the reason for the $600 million and $1.7 billion estimates is that the Legislature didn’t complete all of its funding work for the 2016-17 spending package, including controversial gambling expansion – which was earmarked to generate $100 million in revenue. Beyond not funding the budget completely, the Legislature plugged into the current budget overly optimistic incoming-revenue projections. According to Albright, the administration will be working to close the $600 million hole, with General Fund tax revenues being $129 million short of estimates for the month of November alone. Wolf has previously proposed tax hikes to right the commonwealth’s fiscal ship, while Republican lawmakers have remained strongly opposed. Without a turnaround in the state’s fiscal fortunes, a tax hike is looming, if not sooner than later – and the later it is, the bigger the increase could be.
And until a broad-based tax increase is given serious consideration, all tax credits in Pennsylvania – including the film tax credit – could potentially be cut or eliminated as a way to plug the budget hole.
President
US Senate
Statewide Races
PA Senate (31 Republican, 19 Dems PRIOR to election) Incumbent Senator Teplitz was defeated by Republican challenger John DiSanto Incumbent Democrat Senator Sean Wiley loses to Republican Dan Laughlin Republican Wayne Langerholc defeats Democrat Ed Cernic (Former John Wozniak seat)
Republican Senator Tom Killion won a close race for re-election Republican Mike Regan easily defeated John Bosha (former Pat Vance seat) Republican Scott Martin defeated Greg Paulson (former Lloyd Smucker seat) Democrat Sharif Street ran unopposed for open seat (former Shirley Kitchen seat) 31 Republican, 19 Dems PRIOR to election Senate Rs gain 3 seats New makeup: 34 Rs/16 Ds PA House – upsets/close races Incumbent Democrat Jarrett Gibbons lost to Republican Aaron Bernstine Incumbent Tim Mahoney lost to Republican Matthew Dowling Incumbent David Parker lost to Democrat Maureen Madden Incumbent Democrat Leanne Kruger-Braneky narrowly defeated Republican Morrisette Rodgers Incumbent Republican Dan Truitt beat challenger Carolyn Comitta by 80 votes Incumbent Democrat Minority Whip Mike Hanna withstood serious challenge House of Representatives - Open Seat Winners Rep. Peter Daley (D-Washington) – Republican Donald Cook Rep. Ted Harhai (D-Westmoreland) – Republican Justin Walsh Rep. Nick Kotik (D-Allegheny) – Democrat Anita Astorino Kulik Rep. Mauree Gingrich (R-Lebanon) – Republican Frank Ryan Rep. John Payne (R-Dauphin) – Republican Tom Mehaffie Rep. Sandra Major (R-Susquehanna) – Republican Jonathan Fritz Rep. Mike Vereb (R-Montgomery) – Republican Michael Corr Rep. Chris Ross (R-Chester) – Republican Eric Roe Rep. Thaddeus Kirkland (D-Chester) – Democrat Brian Kirklan Rep. Bill Adolph (R-Delaware) – Republican Alex Charlton Rep. Julie Harhart (R-Northampton) – Republican Zachary Mako Rep. Kevin Schreiber (D-York) – Democrat Carol Hill-Evans Rep. Steve Santasiero (D – Montgomery) – Democrat Perry Warren Rep. Mike Regan (R-Cumberland) – Republican Dawn Keefer Rep Tonyelle Cook-Artis (D-Philadelphia) – Democrat Chris Rabb defeated Latry McDowell Rep Mark Cohen (D-Philadelphia) – Democrat Jared Solomon Rep. Dwight Evans (D-Philadelphia) – Democrat Isabella Fitzgerald Previous makeup of House 119 Rs/84 Ds Republicans gain 3 seats (4 went R, 1 went D) New Makeup of House 122 Rs/81 Ds
It is important that all PAFIA members contact their State Senators and House Representatives to let those in Harrisburg know that we feel strongly about the film tax credit. To find your Legislator, please go to the following link: http://www.legis.state.pa.us/cfdocs/legis/home/findyourlegislator/
By: Lisa Budwig
The company description of TC Motion is “a motion communications content provider serving advertising agencies, broadcasters, and corporate communicators.” But their tagline, “Anywhere Pictures Move,” really does say it all… about the company and the man who runs it. For Max Zug, the love of film was and remains inspired by the technical magic of “frame plus frame equals motion.”
It was at Temple University Ambler on the first day of his college class, “Film – Light and Shadows,” that Max’s love of film manifested into a career choice. After graduation, the goal was to direct, but while all his college friends headed to NYC or L.A., Max returned to Berks County, dedicated to helping his family and determined to work in film in whatever ways he could find locally. From volunteering at BCTV where he ran a camera, to a small CBS affiliate where he learned to make low budget commercials, to WGALTV’s PM Magazine, where he was hired as a videographer, Max took advantage of every opportunity that came his way. At WGAL, he added editing and field producing to his resume and quickly rose to the position of senior producer, working on national stories.
Ever eager to learn, he moved on to Ford New Holland’s internal production company, and when that division went independent, as VMI Communications, Max negotiated an equity stake. During his time with VMI, he did what he says is perhaps the most important thing anyone pursuing this business can do – he “shot a lot of film” – more than 55,000 feet of film one summer. Eventually Max parlayed that ownership stake, along with his experience, knowledge, skills, and the strong relationships he’d built over the previous decade, into starting his own company, MaxFilms, which would become the premier regional film and commercial production house between Philadelphia and Pittsburgh.
By 2010, the economy, MaxFilms, and Max himself had gone through changes, and he was approached by former colleagues with an opportunity to run the business with full creative control, but without sole ownership responsibility, and TC Motion, the in-house video production division of TC Studios, was born.
TC Motion offers “script to screen” services for national advertisers and corporations, including Pergo, Armstrong, Chicco, Moen, and Sharp, among many others, with 90,000 feet of studio space and state of the art editing, motion graphics, and shooting capabilities. They employ dozens of talented, highly skilled people in the creation of what Max describes not as commercials, but “30-second films” and “marketing narratives.”
For Max, being an involved member of PaFIA just makes good sense for both TC Motion and the Lancaster County economy. As a local employer that collaborates with other local companies and uses local suppliers, he says PaFIA’s work to expand the film tax credits makes it a valuable partner in advocating for and building a vibrant film industry community, and that wouldbenefit all businesses.
Increased tax credits would allow for more film development and production in Central Pennsylvania and would provide meaningful creative work for hundreds of people, from actors to craftsmen to caterers right where they live. It would also bring added dollars to all the local support service businesses, like construction, hotels, food service, locations, transportation, and many others. For them, membership and involvement in PaFIA is an investment in the future of their businesses.
Finally, from a personal perspective, Max believes an essential benefit of PaFIA membership for anyone in the film industry is the opportunity to make and share connections and build relationships. After all, he wouldn’t be where he is today without those strong relationships of his past, his “big fat rolodex,” of skilled, talented, and supportive people who gave him opportunities and shared their expertise along the way…a rolodex that now includes those passionate new film lovers to whom he offers his expertise and mentorship to ensure the pictures keep moving.
By: John Rokosz
What are the advantages of keeping a competitive film tax credit in Pennsylvania? PaFIA is proud to share stories from the men and women of the PA film industry that earn their livelihood, raise their families, and contribute to our state’s economy—solely because of the PA film tax credit. Equally important however, yet easily overlooked, is the widespread benefit that the tax credit sets in motion across industry lines. Tague Lumber recognizes the outreach of that tax credit, especially as it relates to tradesmen industries such as electricians, carpenters, plumbers, and masons. As a result, Tague Lumber decided to forge a relationship with the Philadelphia chapter of PaFIA to support the cause.
James E. Tague and Co. opened in Philadelphia in 1908. Over the next 100 years, their business went from two horses and a second-hand lumber lorry to a diverse company extending outside the city limits, offering a range of services such as custom millwork, full metal welding and fabrication, master keying, jobsite deliveries, and door and hardware takeoff assistance. The newest additions to the Tague family of companies are the old Danby Lumber yard in Kennett Square and Doylestown Lumber, and they boast a signature fleet of red trucks that provide efficient delivery and exceptional customer service. That same day service and quick turnaround has put Tague Lumber in an excellent position to facilitate the time-sensitive needs of the film industry. For the past 10 years, they have been providing building materials such as lumber, plywood, and hardware for movie sets in Eastern PA, delivering the materials directly to the set, or to the construction site.
Kevin Potter, a purchasing manager at Tague, described his experience with PaFIA as a very positive one. They decided to become a PaFIA sponsor 5 years ago, after discussing the encouraging film business they were seeing with a contact in the rental car industry. Since then, Tague has been attending PaFIA events and building a network in the film community. As Kevin explained, “It’s been fun, and being a part of the PaFIA community puts us in the front when it’s time to hire contractors for film.”
When asked about the role of the PA film tax credit, Kevin didn’t hold back: “It’s critical for the health of our local economy. It also benefits many different types of businesses—not only our company, but so many other tradesmen in the state.” Kevin went on to say how pleased he is with the connection they’ve established with PaFIA, and the message they’re sending to Harrisburg about the film tax credit. “It’s a well-placed credit,” he said, “because it encourages revenue by empowering businesses, investment, and employment.”
PaFIA would like to thank Kevin, Katie Connor, and all the folks at Tague Lumber for their support over the past 5 years. We’re anxious to continue our relationship, mutually ensuring that the positive message to Harrisburg continues for years to come!
Please visit our friends at www.taguelumber.com for a better look at their services, which include architecture, building, design, delivery, installation, and renovation.
Film production can be a daunting venture, with each project containing hundreds of moving parts. Equally overwhelming can be the navigation of the financial and tax requirements of any film project—large or small. To make this undertaking more manageable, Wipfli is a corporate member of PaFIA that provides CPA and consultant services to film projects in PA; helping them stay in compliance for the PA film tax credit, or assisting with their production accounting.
In 1930, Clarence J. Wipfli & Company was founded in Wausau, Wisconsin. Since that time, the firm has grown to include over 1,800 professionals in offices across the United States and India and currently ranks among the Top 19 accounting and consulting firms in the nation. Today, Wipfli provides individual and corporate accounting, tax and consulting services to clients throughout the US. For film in Pennsylvania, their firm provides attest work for PA Film Tax Credit compliance. They work with production companies that have received tax credit approval letters for projects and perform either agreed-upon procedures or audits, depending on the size of the credit.
Wipfli became involved with the PA film industry over six years ago, in response to one of their existing clients who had learned about the credit. Melissa Fisher, a Senior Manager at Wipfli, recalled the experience: “In those days, the state itself was performing audits and our client asked us to be present and help them out. Soon after, the same client had another large project that qualified for a credit, and the work grew from there.” Today, Wipfli receives most of their film industry business from the Greater Philadelphia Film Office, recommendations from the state, and other satisfied clients.
As this work started growing, Wipfli researched and talked with some of their existing clients, and made the decision that working with PaFIA was where they should be. Besides the obvious benefits of increased revenue and a larger network of clients, Wipfli had continued to learn about the film industry and had been making themselves available as needed. As Melissa puts it, “We have wanted to show our support for the industry and the work performed in Pennsylvania.”
Wipfli has become a powerful advocator for the cause of protecting and maintaining the film tax credit. Besides being a corporate member of PaFIA, they have worked with the state, explaining the requirements of the tax credit from an accounting standpoint, and have made recommendations for changes to benefit film producers of all sizes! “The PA Film Tax Credit has been beneficial to our clients, which is first and foremost our primary focus. We always want what is best for them,” Melissa concluded. “We have built our network of clients and as a result have increased our region’s revenue. What started for us as servicing our clients has grown to become an area that we continue to want to grow.” PaFIA would like to thank Wipli for their membership and support, and for making it easier for film producers to bring work to Pennsylvania!
Please visit our friends at www.wipfli.com for more information about their individual and corporate accounting services.
By: JaLia Moody
Recall the classic detective film Inspector Gadget? Well, that film landed Joe Huber’s auto company, Precision Body and Service Inc., a recurring role in the film industry. For 32 years, Precision Body and Service has served the Pittsburgh area to car owners, commercial truck drivers, and the film industry.
Ever wonder where those wrecked cars end up? Huber’s auto shop takes them and fixes them to be ready for production. From trailers to trucks to cars for a set, he paints, remodels, or fixes what is sent to him. From the day he graduated from high school, he transitioned to working in the auto industry. He taught himself how to do bodywork by age 17—18. He held a deep interest for car remodeling since he was young. PaFIA’s own David Haddad introduced him to another world of car remodeling – the film industry. Joe says the most memorable experience thus far from working in the auto industry is meeting David Haddad because he has brought him a lot of work. When asked to compare working with car and truck owners to the film industry, Joe answered that each are about the same. Neither is less nor more difficult.
Joe advises anyone looking to step in his shoes these words of wisdom: “You have to really go out and get it and you got to hustle for it.” He is saying that one must possess two things: urgency and desire. Just go for it!
Pennsylvania Film Industry Association (PAFIA)461 Cochran Road, Box 246Pittsburgh, PA 15228(717) 833-4561 info@pafia.org
Pennsylvania Film Industry Association (PAFIA)Pennsylvania Film Industry Association (PAFIA)