What’s Working: Why Colorado could start attracting more filmmakers

Incentives could also provide steady employment for industry. Plus: What other states like Georgia pay, entrepreneur Polis, around $225 million available in small business loans, more!

By Parker Yamasaki and Tamara Chuang 4:44 AM MDT on Jun 8, 2024

from: the Colorado Sun

The 2020 heist movie “Rook” was filmed on location in Cripple Creek and Victor Colorado. (Provided by Colorado Office of Economic Development and International Trade)

Sheila Traister got her start acting in commercials in the late 1980s when, she said, Colorado was in the middle of a filmmaking boom. But by the late 1990s the local work started to dry up, and Traister started traveling more.

“For somebody like me, the majority of my work takes place out of state now,” Traister said. “So I will spend anywhere from 20% to 40% of what I make on a job to do the job.”

Last week Gov. Jared Polis signed House Bill 1358, which expands a tax incentive credit for film, TV and commercial productions that want to shoot in Colorado. The bill allocates $5 million per year over the next four years to spend on refundable tax credits for productions filming in Colorado.

A 2022 legislative task force study reported that since Colorado began offering film incentives in 2012 (which, before last year, were distributed as cash rebates), the state spent $30 million over the decade, or roughly $3 million annually. The Colorado Office of Film, TV and Media reported $182.8 million in actual and predicted production spending and 6,023 cast and crew hires during that time.

The assumption of the incentive is that film productions can be a huge financial boon for local businesses.

In 2022, New Mexico reported a 660% increase in direct spending from the film and television industry in their rural regions — up to nearly $50 million from $6.5 million in 2021. The state has since increased its tax incentive bump to 10% from 5% for productions that film outside of the Santa Fe-Albuquerque corridor.

Colorado is hoping to see similar gains, with additional incentives for productions that use local infrastructure, and film in rural regions or marginalized urban areas.

But bringing in more film productions can also benefit Colorado in a qualitative way, by creating clearer professional pathways for creatives who live, and hope to work, in the state.

“It’s harder to gain experience when you don’t have opportunities to mingle with people at a higher level than you are professionally, or be on their crew or shadow them,” said Micah Baird, an independent filmmaker based in Fort Collins.

“It’s the same thing even for people a level or two above me,” he said. “Like, there’s not a lot of people who start excelling here —they move to California or are constantly traveling to where there is another level of opportunity, and where the whole infrastructure is there already.”

So what does House Bill 1358 do?

In short, the bill lengthens the amount of time that refundable tax credits will be available — to four years from one — and removes a condition that states the credit was only available when state revenues exceed state spending by at least $50 million.

The extension of the credit helps in three major ways. First, it allows film production companies to plan out projects years in advance, which is common practice for bigger productions.

“We can’t just say here’s a ‘maybe’ for projects that want to come here. Productions shy away from Colorado because of that reason,” said Bryant Preston, president of the International Alliance of Theatrical Stage Employees, Local 7.

The multi-year guarantee will also help lure in episodic productions like TV shows, which distribute economic impact over multiple years, and won’t gobble up the $5 million credit in one fell swoop.

Finally, it creates a runway to build up Colorado’s film industry infrastructure. Some of that infrastructure is physical, like sound stages. But some of it is professional, like internships and shadowing opportunities.

“All the money and resources invested into state education, just to have those students graduate and leave the state. Or they leave right after high school because they know there are no internships of real consequence to be had in Colorado,” said Traister, who created an acting department at the Colorado Film School 25 years ago.

Baird, the filmmaker in Fort Collins, feels rooted in Colorado. “I think we just need infrastructure in general, like a path for people, and students, that gives them the opportunity to stay and work.”

38 states have incentives

The way that film locations are chosen has changed drastically over the past two decades.

“It used to be that if they needed the mountains like we have, films came here. If they needed the beach, they went to Florida or California. If they needed skyscrapers, they’d go to New York City. If they wanted plains and plateaus, they’d go to the Midwest,” Traister said.

But since roughly 2002, when Louisiana became the first state to aggressively ramp up its film tax incentive program, locations have been almost entirely incentive-driven. For example, as the New York Times quipped, when Michigan unwound its once-robust film incentives, it lost out on the filming of “Detroit,” which ended up being filmed in Boston.

Thirty-eight states now have allocated tax incentives for film productions; five states introduced those incentives in the past two years, and two states —Michigan and Wisconsin — are working to reinstate their abandoned programs.

Georgia’s $5 billion in incentives

And then there’s Georgia.

Since Georgia started its film tax incentive program in 2005, the state has doled out nearly $5 billion in incentives. Those investments have proven fruitful, but they’ve also put a target on Atlanta’s back.

“I kept seeing films that said they were based in Colorado that weren’t. They had our mountain ranges wrong, and at the end of it, was that damn Georgia peach,” said Rep. Leslie Herod, one of the bill’s sponsors, at the bill’s signing event. “And if you guys have heard me speak about film, you know how much I can’t stand that peach. Because quite frankly it should be our beautiful Rockies.”

For what it’s worth, the Georgia film commission offers an additional 10% credit on the 20% base tax credit if films embed that ubiquitous peach logo in their end credits.

But Georgia’s program, successful as it has been, might be a little too pie-in-the-sky for Colorado’s current film industry. Even our neighbor New Mexico’s incentives, which will increase from $110 million in payouts to $160 million over the next four years, are hard to compete with at this time.

Preston said Colorado should be competing with our other neighbors —Utah, Wyoming and Oklahoma. (Two sources brought up the fact that the hit show “Yellowstone,” supposedly based on a ranch in Montana, was shot in Utah.)

Incentives success and skepticism

To be clear, film tax incentives have not proven to be cure-alls for ailing economies. Some states, like California, Pennsylvania and Virginia, have reported that their programs either didn’t make a huge difference for productions’ decisions to shoot there (California) or had a negligible impact compared to other industry-specific incentives.

But those states have kept their film tax incentives propped up one way or another, acknowledging that even if the return on investment wasn’t quite as stunning as they’d hoped — Pennsylvania reported a 13.1 cent return for each tax credit dollar spent —they all still created a net positive.

A 2023 audit of Georgia’s film tax credit addressed skepticism about whether the state was really seeing a substantial return on investment when comparing tax dollars in versus tax dollars out, but did conclude that the tax credit “induces substantial economic activity.”

“When you incentivize the film industry, that impact reaches just about every business you could possibly think of,” Traister said. “If you’ve got a three-week film shoot or a six-month TV series, those people are living here. They’re going to our theaters now, our museums, our restaurants, our zoos, our city parks. They’re gonna go to Garden of the Gods and Aspen and Snowmass, and it just goes on and on and on.”