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For a filmmaker looking for just the right setting, Arkansas might just have it all: small towns and skyscrapers, farms and freeways, mountains, foothills, swamps, delta and piney woods. After June 30, however, the state won’t have what the moneymen behind big-budget films increasingly look for most often: a lucrative incentive program that returns money spent in the state to the film companies that spend it. At the end of June, Arkansas’s incentives — now outdated, but once the standard of the industry — will sunset, with no new plan to take their place. While those who know say that isn’t quite a disaster for Arkansas film, they add that it does mean the state will end up getting passed over for even more feature film productions every year.
Arkansas has had a film incentive program since 1983 — one of the first programs of its kind in the nation. Under the current terms, production companies spending more than $500,000 in the state within six months or more than $1 million within 12 months are eligible to receive a full refund on sales and use taxes they paid to the state.
Since those pioneering efforts at luring Hollywood away from the Pacific, however, other states have jumped on the bandwagon, offering much more lucrative deals. Louisiana, which features one of the most generous film incentive programs in the South, gives filmmakers a tax credit that equals 25 percent of the money they spend in the state and 10 percent of the money spent to hire Louisiana residents. New Mexico, another state which has landed big productions because of its film incentive program, offers a 25 percent tax rebate on all in-state spending, interest-free loans of up to $15 million for productions budgeted at over $2 million, a coupon program that exempts cast and crew from state sales tax, and a 50 percent reimbursement of wages paid to New Mexico residents during on-the-job training for crew positions such as set building and rigging.
Little Rock resident Ray McKinnon is a screenwriter, director and actor who has been in the film business for over two decades. McKinnon’s “The Accountant” won the Oscar for best short film in 2001. In 2004, he directed his wife, Lisa Blount, and co-starred as a greasy drug dealer, in the feature “Chrystal,” filmed mostly in Northwest Arkansas. Having worked as an actor in New Mexico, McKinnon said he’s seen first-hand the dramatic results incentives have had on movie-making there.
“They have actually transformed their film industry,” McKinnon said. “They’re at the point now where they’ve done it long enough that they have trained crews that actually live there.”
McKinnon said that with spending for even “low budget” films routinely topping millions of dollars, one has to assume that productions will go where they can get the “most bang for their buck.” He chose to film “Chrystal” in Arkansas, in spite of our lackluster rebate program, because the look of the Ozarks would have been impossible to create elsewhere.
“We did get some little rebate through the state government,” he said, “and Eureka Springs gave us a sales tax rebate, as I recall — which helped greatly — and a hotel tax rebate. At these kinds of budgets, boy it makes a big difference.”
All is not lost, even after Arkansas’s film incentives program ends on June 30, said Joe Glass of the Arkansas Film Office. One of the last men in the world who carries a beeper, Glass is a promotions machine for Arkansas film. He said that while filmmakers can be lured to the state by its beauty and hospitality, a more up-to-date incentives program would definitely help. In the meantime, Glass said that local businesses work together with the film office to bring in films. Recently, he said, a filmmaker touring the state bragged to him about the great deal he would be getting on rooms for cast and crew in Louisiana — $99 per room, with a 15 percent tax rebate. With a few calls to local hotel owners, Glass was able to find the producer “a much better room rate” at the local Hilton.
Once the film incentives program sunsets, Glass said it might make for a great opportunity to take a look at helping homegrown filmmakers.
“We’ve really spent our energies trying to encourage the film industry to come here,” he said. “Maybe it’s time to try to cultivate things from within — those people from here who are trying to make it in film.”
Joe Holmes is a spokesman for the Arkansas Economic Development Commission, which oversees the current incentives program and the Film Office.
“The film office over the past many years has not been a strong, strong focus,” Holmes said. “It has not been a big focus and — incentive-wise — we haven’t had a whole lot to offer.”
As with any program designed to bring business to the state, Holmes said, you have to look at what you get for the money. In the past, several attempts at strengthening the state’s film incentives program have been shot down due to fears of giving away profits reaped from productions.
“I think the thing you always need to look at with incentives is, what’s the return?” Holmes said. “I don’t have any idea what kind of return those states (Louisiana and New Mexico) are getting on their incentives.”
With two bills aimed at revamping the incentives structure having failed in the last legislative session, Arkansas is soon to be without a program at all. Holmes said that while the state will likely keep “some level of activity” when it comes to film, the years between now and the next session will be spent deciding how the state wants to proceed in regard to attracting movie productions. Holmes said that with the election of a new governor, AEDC is getting new management and restructuring. “We’ve got to define which way we want to go and then build a program around that,” Holmes said. “Until we decide what kind of focus can be brought to marketing the film industry here in Arkansas, it seems prudent to do that first before we decide what kind of incentives we need. It’s kind of a ‘chicken and egg’ thing.”