In mid-2006, film companies received a big present from South Carolina. Lawmakers passed a proviso bill that boosted the wage and supply rebates given production companies for making their next big blockbuster or hit TV show in the Palmetto state. That meant for every actor or crew member hired for a S.C. project, or for every S.C. business whose services they employed, a production company got a 20 to 30 percent tax rebate back from the state.
It was like Christmas for Hollywood. This was the era of the films Death Sentence, The Strangers, Taking Chances, Who's Your Caddy, Asylum, and Leatherheads, plus the TV show Reinventing the Wheelers. It was also when the pilot and first season of Army Wives were shot in Charleston, and we all know how that ended up.
"There was a film in Florence, a film in Columbia, a film in Rock Hill, a film in Aiken, something going on down here in Charleston and in Beaufort," Richard Futch, president of the Carolina Film Alliance, says. In all, there were nine projects qualified for rebates — compared to just one the previous year. "Things were happening all over the state, so it really did affect the local businesses statewide, just as we said it would."
But that proviso was temporary, and those incentives fell by the wayside during Gov. Mark Sanford's administration. As of 2013, production companies can get a 15 percent cash rebate for wages and supplies. It's not a bad deal, but it's not great when compared to other states. Take Louisiana, for example. They offer a solid 30 percent film tax credit, plus an additional 5 percent credit for employing Louisiana residents. That might be why the recently Beautiful Creatures film was made outside of New Orleans and not in the Lowcountry, where the story is actually based. (And we won't even go into the times when current Gov. Nikki Haley got veto-happy with the state's film commission budget. That's a whole other story.)
Futch also spent six seasons as the casting director for Army Wives, and he's seen first hand what happens on a production's downtime. "You saw the amount of money that was spent every episode and every season and then the effect that it had when our show was on hiatus, when that money was not being spent in some of these small businesses," he says.
That's why the CFA is currently at work to boost the state's production rebates, using the money it collects from memberships and sponsorships to advocate for the local film industry. "One of the initial goals of the CFA when we started in 1998 was to make sure that our legislators were educated as to the impact and importance of a film industry on the economy of South Carolina," Futch says. In the last few years, the CFA has employed the services of Greenville-based issue advocates John Deworken and Sunnie Harmon, who have worked to introduce two bills into the Statehouse this year that would increase rebates.
Right now, if a production company decides to come to the state of South Carolina to film their next blockbuster — and they plan to spend more than $1 million to do so — then they can qualify to receive the 15 percent wage and supplier rebates. "The problem is is that those 15 percent rebates are not competitive at all with other states," Deworken says. "So therein lies the problem, that though production companies want to come to South Carolina because of the geographic diversity ... we are not competitive."
That's why the proposed bills will increase wage rebates to 20 percent, with an additional 5 percent added for employed S.C. residents, while supplier rebates would be boosted to 30 percent for material services. That way, the production companies would have some incentive to hire S.C. residents and use S.C. businesses.
"What we have been told by the Film Commission and others is that if we are able to pass this bill, then we will see an influx of films like we saw in 2006 and 2007," Deworken says.
It's important to note that the bills aren't asking for more money — there's already up to $15 million set aside in the state budget every year for the rebates, even at their current rate. The general assembly appropriates money to be set aside for wage rebates, while the funds for supplier rebates come from admission taxes on sporting events, movie tickets, etc. And these rebates are given to production companies in cash. The proposed bills wouldn't increase this amount. "It has no fiscal impact," Deworken promises. "It has no impact on the budget."
The companion bills have been introduced in both the Senate (by Berkeley Sen. Paul Campbell) and the House (by Greenville Rep. Phyllis Henderson). "If we can give them the right encouragement, I think we can do more films here," Campbell says. "They come in, they employ people, they buy from our merchants. It's good for the economy, and it's a very clean business. And when they leave, they leave the money with us."
Currently, the House bill is in the Ways and Means Committee, which is too busy dealing with the state budget at the moment to make much progress on anything else. Meanwhile, Deworken is working to get the bill placed on the Senate's calendar in subcommittee, which he hopes to have done in the next couple of weeks.
Deworken feels confident that the legislature will be enthusiastic about bringing movie production studios, which spend millions and provide thousands of jobs, to the state. And while the residual effects of film-based tourism (as in the people who want to see where Ryan Gosling and Rachel McAdams fell in love on King Street) can't be precisely measured, that's certainly another beneficial outcome. "I think the legislature and others see the value in companies coming to South Carolina, dropping millions of dollars in local suppliers, and for local crew members who are already here, particularly knowing that there is no more money that is being asked or asked to come out of the budget," Deworken says.
Futch also points out that, according to a 2011 study prepared by AECOM for the S.C. Department of Parks, Recreation, and Tourism, the state profits greatly from rebates. For every $100 paid in wage rebates, South Carolina residents earned $230, while for every $100 spent on supplier rebates, state businesses generated nearly $370 in sales. "It can just be such a productive thing to keep jobs here in S.C. and keep the film crew members working in their own home towns, paying taxes, sending their kids to school here, buying things here, and it also means that there are tons of small businesses in every little town and village and city even the size of Charleston, Greenville, or Columbia that can benefit from having any kind of film work going on in your area," Futch says.
Futch, Deworken, and Campbell all say they haven't heard of any resistance to the bills from legislators just yet, and they're positive that the outcome will be in their favor. "I know that there are some legislators who are wary about rebates and things of this nature, but I think we'll be able to convince them that because we're not changing any money that we're asking for," Deworken says. "That that's not the issue. The issue here is just to tweak the incentives so that we're able to attract films here and generate more jobs and capital investment."
In the meantime, S.C. citizens can contact their local legislators and express their support. Visit scstatehouse.gov to find your representatives.