Projected Benefits

Massachusetts tries to lure the film industry east-- but will tax incentives pay off?

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For decades, Hollywood has been the Mecca of the American film industry, while Boston has remained a city with more drizzle than dazzle. Rarely do the two towns’ paths cross, but when they do, the result has taken the form of stars like Ben Affleck and Matt Damon or box office hits like and “The Departed” and “Mystic River.”

“There’s always been—not a love/hate relationship—but a push-and-pull between Hollywood and Boston,” says Paul Sherman, author of the book “Big Screen Boston.” “There are obvious reasons that have made Boston not necessarily one of Hollywood’s favorite locations.”

If Boston’s weather and distance from California weren’t deterrent enough, uncooperative government agencies and unions have also contributed to this rift. After the Massachusetts Film Bureau was dissolved in 2002, it looked as if the Bay State’s major motion picture future was destined to be restricted to films explicitly requiring Boston’s unique Puritanical charm. Then, in 2006, Massachusetts joined other states in offering financial incentives—specifically, a 25 percent tax credit for in-state spending—to film productions. It wasn’t long before Tinseltown had changed its attitude toward New England and, in just two years, the Massachusetts film industry has morphed from a nearly non-existent enterprise into a lucrative revenue generator.

“[Massachusetts] went from one [film] in 2005 to two in 2006 to eight last year, and this year we’re already at ten,” says Nick Paleologos, the executive director of the Massachusetts Film Office. “And what that’s meant in dollars and cents is also a dramatic change.”

But with a national economic recession well underway and a Bostonian tradition of documentaries and independent films rather than blockbuster thrillers and romantic comedies, the question remains: does Massachusetts have what it takes to become a big star in the film industry?



AN INDEPENDENT HISTORY

“Boston has always been a really interesting town for film,” says Ned Hinkle, creative director for the Brattle Theatre, an independent movie theatre in Harvard Square. “It’s gone through phases, but typically, it’s been a really good place to show specialty films and art films and classic films because there is such a broad base of support.”

Boston’s support for documentary and independent filmmaking has occasionally found its influence filtered into the mainstream. Independent filmmaker Jan Egleson shot films in Cambridge during the late 70s and early 80s, and his working-class dramas inspired other local filmmakers, such as Christine Dall and Randall Conrad—a husband-wife duo whose 1981 film “The Dozens” won an award at the U.S. Film and Video Festival, the Sundance Film Festival’s predecessor. Egleson was also an early admirer of Ben Affleck, casting the actor in his 1981 film, “The Dark End of the Street.”

“Fifteen years after that, [Affleck] and Matt Damon write ‘Good Will Hunting,’ which is also a class-conscious Cambridge story,” Sherman explains. “Movies like ‘Good Will Hunting’ sustain Boston as a movie location, and a couple years after that, Clint Eastwood made ‘Mystic River’ and then Martin Scorcese made ‘The Departed’ and then it came full circle when Ben Affleck made ‘Gone Baby Gone.’ It’s a whole chronology that you can follow to today from the late 70s.”

But hometown pride is not enough to sustain an industry, and Massachusetts hopes that Hollywood producers’s devotion to the bottom line will draw more films to the state.

“Producers don’t really have the loyalty to stay in California,” Riverton says. “If it’s cheaper to shoot elsewhere, then they’ll shoot elsewhere.”





When Canada enacted some of the first incentives at the turn of the millennium, the weak Canadian dollar and the tax credits were enough to lure many Hollywood films out of the country altogether. An ensuing uproar within the American film community sparked a move to entice these “runaway productions” to remain in the lower 48, and many states formerly unfamiliar with film production found their way into the industry. Currently, approximately 80% of American states provide some benefit—ranging from sales tax exemptions to tax credits—to films that shoot within their borders.

“The creative is very important,” Riverton says, “but the truth is, a lot of states can be made to look like each other very easily, so unless there is something so integral to the script or the movie that it has to be done in that state, there’s always going to be some cost-benefit analysis.”

The Massachusetts Film Office has been taking such analyses very seriously. The spike in film production spending—an increase from six million dollars in 2005 to nearly 400 million dollars in 2007—has the Office scrambling to meet the needs of film producers, an effort that they believe will be worth the extra attention if the initiative succeeds.

“More than any other time, it’s important not to tamper with those programs that are working,” Paleologos says. “As you look across the landscape, people are being laid off, companies are being closed down, budgets are being cut back. The one area in our economy that is expanding and hiring and succeeding is [film].”

In order to sustain this trend, Paleologos and the Film Office are trying to find ways to develop the workforce of below-the-line film employees that are not generally connected to a film before it starts shooting. The abundance of students studying film at Boston’s many colleges are a renewable resource of future film workers, and the Film Office has organized a “PA Bootcamp” in coordination with area schools.

In addition to a reliable below-the-line workforce, film producers also need studios and soundstages, a request that has left members of the Film Office searching for usable warehouses. Last Monday, the town of Plymouth approved the construction of Plymouth Rock Studios, a $400 million privately-funded studio complex proposed by a group of Hollywood veterans that seeks to fill this need.

“The idea is that if there is a filmmaker that comes out, they’re going to be shooting in Massachusetts, they’re going to be utilizing the facilities that we have available for them,” says Peter Fleury, Executive Director of Operations. “It’s expensive to bring out an entire crew, so we want the talent on the East Coast to be utilized.”




Despite the apparent success of Massachusetts’s incentives, incorrect budget estimations and other indiscretions have caused some other states to lose money in developing their film industries. Not everyone is convinced that Massachusetts can successfully avoid the challenges that others have faced, especially in an industry that has, until two years ago, been relatively nonexistent in the state. While proponents of film incentives argue that movies have continued to fare well despite past economic downturns, history may not be completely reliable as a predictive tool.

“This supposition that the entertainment or film industry is an antidote or goes contra to the economy is incorrect,” says Harold Vogel, who served 17 years as the senior entertainment analyst at Merrill Lynch and is current president of Vogel Capital Management. Vogel believes that the sustained success of the film industry during past economic recessions was largely based on historical circumstances that no longer apply.

“Movie tickets benefited in the early part of the Great Depression because it was a change to a new technology...The movies actually got sound and that attracted a log of people who probably wouldn’t have otherwise gone,” he says. “Back in 1930, there was no television. There was no DVD, no cell phone with webisodes, no iPod...Movies are just one of the things that are out there, and they are not going to resist this downturn. They’re going to suffer just like anything else.”

Just as the success of movies and the flow of films to Massachusetts is an uncertainty, so too is the overall economic impact that they will have on the State. Paleologos believes that a “multiplier effect”—the idea that economic development will stimulate more than just the directly affected industries—may cancel out any money that the state puts into its film efforts.

“Those people who have been critical of the tax credit, they’re not even factoring in things like Plymouth Rock Studios,” Paleologos says. “That’s 400 million dollars of economic activity, which, if it gets going, will cost us nothing. It’s all privately funded. We’re not putting any additional tax incentive to get them to build here.”

But the unreliable, temporary nature of the film industry raises concerns that this type of stimulus may be more effective in a more permanent industry.

“There’s a multiplier effect on anything,” Vogel says. “If you pave a road, there’s a multiplier effect. If you build a house, there’s a multiplier effect...But no one really knows to the last decimal what that multiplier is.”






While some economists remain unconvinced of the film industry’s economic trickle-down effect, active members of the Boston film scene foresee local film culture only garnering perks from the increased film activity. And the benefits of an existing film support network to an incoming film industry may ultimately prove to be one of the most important factors in a film incentive competition between states.

“Because of the college community and the tradition of supporting the arts, [independent and specialty films] can thrive here where they might not somewhere else,” says Loren King, president of the Boston Society of Film Critics.

Specialty theatres in the Boston area also have a broad base of support, a network that Hinkle attributes to the number of devoted students and film enthusiasts. And while fundraising for non-profits are a concern during the current economic situation, Hinkle remains optimistic, recognizing the importance of such a resource of film buffs, whose donations currently sustain the Brattle.

“That theatre would never exist outside of Harvard Square because it’s got a community to support it,” King says. “It’s built a long tradition of people that...want to see it continue, even in these bad times when a lot of theatres are folding.”

Boston’s taste in film, which she says “tends to run outside of the mainstream,” has allowed many unique festivals to flourish in the area, including the Boston Jewish, Boston Latino, and the Boston Gay and Lesbian Festivals. And although loyalty seems to lie with the local film community, its members believe that a relationship with Hollywood can be mutually beneficial.

“The more film production in general, the better for the community,” Hinkle says.

One of the most important hopes that those involved with film locally hold is the prospect that an influx of mainstream films will create enough new jobs to make it worthwhile for film crew to remain in the area, drawing attention to the special local filmmakers and allowing them to create movies in and about the state and city they love.

“Hopefully, because people don’t have to move to New York to make a living, the film community will get stronger,” Sherman says, “and then someone will emerge who will want to make Boston movies and keep making them here.”

With the combination of financial incentives, scenic beauty, and a supportive group of film enthusiasts, it may not be long before Massachusetts steals the spotlight.

“At the end of the day,” Riverton says, “more and more productions are very seriously considering MA when they’re talking about the top...places to shoot a movie.”

—Staff writer Beryl C.D. Lipton can be reached at blipton@fas.harvard.edu.