New NC film grant program comes with strings attached

Film industry boosters say interest in producing movies and TV shows has dropped dramatically as the state prepares to launch a scaled-back grant program to replace generous tax incentives eliminated last year.

“Our inquiries are down probably 75 percent and will continue to drop,” said Johnny Griffin, who heads the Wilmington Regional Film Commission. “Those that do call are quickly losing interest once they hear the details of the new grant and realize the reduced likelihood of obtaining a competitive incentive.”

The grant program – which will award a total of $10 million – replaces the tax incentive that gave out $61.2 million in credits in 2013 and attracted movies such as “Tammy” and TV shows like “Sleepy Hollow” and “Eastbound & Down.”

Film production companies hoping to get a grant will face a long list of requirements and recommendations, according to guidelines released this week. The guidelines, following language in the state budget, cap grants at $5 million and give preference to filmmakers willing to show “identifiable attractions or state locales that could induce visitation” or who select an “economically distressed” location.

The program would discourage grant seekers from filming in the 20 wealthiest counties in the state under the draft criteria’s definition of “economically distressed.”

The old tax incentives had few strings attached: They offered a 25 percent credit up to $20 million on qualifying expenses.

N.C. Film Office director Guy Gaster says the new guidelines – currently in draft form – will help the state pick projects with the strongest positive impacts. “Since there is an overall cap on the money available, at the end of the day, we’re going to have to select which projects get it,” he said.

The final decision on all grant applications will be up to Commerce Secretary Sharon Decker and “anyone that she appoints or feels should be in the decision-making process,” Gaster said.

Backers of the state’s film industry worry the guidelines could create more barriers to making movies and TV shows here. Katy Feinberg, a spokeswoman for the N.C. Production Alliance, said producers are often filming a story that isn’t set in this state. The TV series “Homeland,” for example, uses Charlotte as a stand-in for Washington, D.C.

“If the whole point is that they want a specific backdrop, we should try to accommodate them as best we can,” Feinberg said. “That said, with any opportunity to help out neighboring counties that have not felt the positive impacts, we should give them a piece of the limelight.”

The N.C. Film Office database of filming locations offers 2,800 spots in popular New Hanover County, but just 13 in nearby Robeson County, which would likely qualify as “economically distressed.” The potential movie sets available in Robeson include a Howard Johnson motel and the Shop & Save Food Mart, according to the database.

Griffin says the emphasis on disadvantaged counties could pose challenges. “Do economically distressed areas have crew, equipment, studios?” he said. “What is the cost/benefit of working in this area?”

Other provisions included in the draft guidelines:

The film office is looking for feedback on the draft guidelines until Jan. 23. The program will start on Jan. 26, and until then, the state won’t accept applications from film companies.

With maximum grants at just a fraction of what neighboring states such as Georgia offer, Feinberg said state officials will need to work hard to attract films.

“When we’ve already decided to shrink the industry, we should be more focused on creating unique and innovative ways to compensate for the cuts we’ve made,” she said.

This story was originally published November 27, 2014 at 4:11 PM with the headline "New NC film grant program comes with strings attached."