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Incentives cutback threatens S.C. film industry
By Dennis Quick
Senior Staff Writer
The S.C. Department of Commerce’s recent decision to reduce financial incentives it began offering last year to film production companies set the state’s film industry on a potentially downward slide.
That slide began when producers of the Lifetime cable TV series “Army Wives,” which is being shot in the Charleston area, threatened to move the production to another state with more favorable incentives.
Makers of the hit series chose to film it in South Carolina because the state offered a 20% rebate on the wages of most employees working on the set. The Commerce Department decided to scale back the rebate for out-of-state employees to 10% and to cap that rebate at $3,500.
The Commerce Department changed its incentive plan to encourage the hiring of residents and suppliers from South Carolina, for whom studios would receive a 20% wage rebate.
The new incentives became effective July 1. That the rebates are cash rebates means that production companies recoup their money quickly. This places South Carolina among the Top 10 states for strong film-production incentives, said Commerce Department spokeswoman Kara Borie.
The point of the “modifications” to the incentives is to have more South Carolinians working on Hollywood films shot in South Carolina, Borie said.
Everybody concerned with the state’s film industry shares that goal. The problem is South Carolina lacks, for example, equipment suppliers that some Hollywood film productions need, said Kaye Koonce, Trident Technical College’s senior vice president and general counsel.
The new incentives could have a “negative impact” on the effort to have six movie studios built on Trident Technical College’s North Charleston campus. The creation of those studios hinges on a lot of film production activity in the state, which the previous incentives generated so successfully that the state ran out of incentive money, Koonce said.
Robbin Knight, president of the Mount Pleasant-based Carolina Film Alliance, a 600-member consortium of film industry professionals and business owners dependent on the industry, considers the incentives change detrimental.
“It’s going to hurt us,” Knight said.
The pain will be multi-pronged. For openers, “Army Wives” has spent about $27 million filming in South Carolina. Local businesses ranging from food caterers to bottled water providers to lumber companies have benefited from these expenditures. Losing “Army Wives” will be an economic blow, Knight said.
Secondly, South Carolina’s reputation is tarnished as far as Hollywood is considered, Knight said.
“‘Army Wives’ sees this as a bait-and-switch deal,” Knight said of the rebate controversy.
As a result, Walt Disney Pictures, producers of “Army Wives,” will “bad mouth” the state, causing other movie studios to bypass South Carolina as a production location, Knight said.
Additionally, Trident Technical College film technician students working on “Army Wives” will lose a valuable experience if the TV show leaves the state, Koonce said.
On June 28, Knight told the Business Journal he was launching a “last-ditch effort” to restore the previous film incentives by having members of the Carolina Film Alliance e-mail Gov. Mark Sanford before July 1. The results of that effort were not known before press time.
Local independent filmmakers Richard Carnahan and Richard Almes, principals of West Ashley-based motion picture company GryphonPix Entertainment, said even though the state’s rescinding of its wage rebate offer has little direct impact on them, the controversy nevertheless damages South Carolina’s image among out-of-state filmmakers.
“Nobody’s going to trust us anymore. You can’t promise somebody something and then expect them to be OK when you take it back,” Carnahan said.
However, because South Carolina now risks being shunned by Hollywood, the state should consider investing in its own independent filmmakers, Almes said.
Charleston-based filmmaker John Barnhardt agrees.
Although Hollywood studios spend a lot when they shoot here, they leave after the production. The studios, always looking from state to state for better filmmaking deals, “bounce from incentives to incentives,” Barnhardt said.
“If you support your independent film community first, and films start coming out of South Carolina, the big companies will take interest,” he said.
Dennis Quick is senior staff writer for the Business Journal. E-mail him at dquick@charlestonbusiness.com.
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