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Paying For Film, Part 1: What We're Getting

In the last few years, two major television series have made Charlotte their home and the Hunger Games was the biggest blockbuster ever to set up in the region. All that has heightened interest in the debate over whether to extend North Carolina's film incentives. They expire at the end of next year. 

But neither side is spinning the full story of these incentives, so WFAE begins a two-part series to explain. 

Cue the big movie trailer voice.

In a world . . . where big Hollywood tax incentives did not exist, North Carolina saw its share of films. . . Dirty Dancing – Bull Durham – The Last of the Mohicans. Then Canada wanted in on the action.

"Canada started offering financial incentives and the industry, pretty much overnight, picked up and went international," says Aaron Syrett, director of the North Carolina Film Office.

By 2009, nearly every state was offering incentives. North Carolina had to sweeten its deal just to keep up – and it paid off: Iron Man 3 became the biggest blockbuster ever to film in the state.  And it took home the biggest incentives check in the state's history.  

North Carolina's film incentive spending surged: In 2010, payouts to production companies from the state's general fund totaled $9 million.  Last year, the total was$69 million.

The state will reimburse 25 percent of what a production spends on goods, services and crew wages in North Carolina. They have to spend at least $250,000, and the maximum incentive they can get is $20 million.  Iron Man 3 was the first to hit that cap.

The result, according to the NC Film Office, is more than $1 billion spent filming in the state since 2007 – some of it going to people like Rick Parris at H&S Lumber in Charlotte.

"They used 50 miles of 1x4s on Hunger Games," says Parris, and his shop provided every inch. "We'd go up there seven, eight, nine times a day. Once you get em', you don't ever want to lose them."

Hunger Games kept H&S Lumber afloat during the recession. Parris has added three full-time employees to keep up with the demands of Hollywood.

But it's a high-maintenance, time-sensitive business. Movies, especially. They dump loads of cash for a few weeks or months, and then they're gone.  Television series stick around much longer - and that's been the big development in Charlotte since Showtime's Homeland chose the city as a less-expensive double for Washington, DC, two years ago. 

Gillian Albinksi is the prop master on Homeland. The shelves in her warehouse are piled to the ceiling with everything you'd need for a parallel universe of spies and terrorists. 

Including a bomb vest, worn by one of the show's lead characters in the final episode of Season One.  She pulls it carefully from a box, chuckling, "This is the baby."  

Most of the props Albinksi rounds up are more mundane. Duffel bags, cameras, teapots: "We spend a lot of time out at North Lake Mall and down in South Park walking around and shopping."

Last year, Homeland reported spending $9 million on props, costumes, set materials and other goods in North Carolina. Another $5 million went to services like accountants and dry cleaners. Nearly $16 million went into wages and benefits for crew members like Albinski.

"There's almost nobody on the set getting paid less than $20 an hour," she says.

Health benefits are included in the contracts.  The lifestyle's a grind – typically 14-hour days for six or seven months.  At the end, crew members will have earned an average of $50,000.   Then it's on to another project.

Since 2007, the state's population of full-time film workers has more than doubled to some 4,000 people, according to the NC Film Office.  Dale Williams handles hiring and spending for the CBS show Under the Dome, which is filming in Wilmington.  She says productions hire locally as much as possible because it's cheaper than bringing someone from out of town who has to be put up in a hotel and paid a per-diem.

"It's like every other major corporation - financial decisions basically dictate where these projects go," says Williams.

And right now, North Carolina is looking a little less attractive.  The film incentives program is set to expire at the end of 2014.  None of the big name productions that have filmed in North Carolina of late would have come without them. But do they leave behind the kind of long-term benefits North Carolina demands of other industries that get incentives? 

Brent Lane of UNC'sKenan Institute thinks not: "Why should every industry and every business and every consumer in North Carolina pay higher taxes so that a few people get highly subsidized jobs on a temporary basis?"

Thursday on WFAE's Morning Edition, we explained how it's possible that millions of dollars in movie studio spending translates to a loss for the state government's bottom line. Listen to Part 2.