Alaska Film Program needs your help

Michael K Bergstrom · January 23, 2008

Please read this email message from the AFG. We are trying to push a Tax Incentive for Alaska right now. If you have shot in, wish to shoot in, or just want to help out Alaska. We would greatly appreciate you taking the time to read. Thank you.

Hello from the Alaska Film Group! Thanks to Sen. Johnny Ellis, we now have SB230 introduced into the legislature and committee meetings starting next week! This has been fast work since our Incentive Workshop in November!

Now it is time for your support.

As an organization that stands to benefit by seeing major feature and television production in Alaska, we hope you will step up to the plate right now and help make this happen. We need letters - DOZENS of letters - from people and organizations who want to see this legislation pass. We have done our homework, and we have worked VERY had to get this far- which is farther than ever before - we can see the light!

SB 230 will help create a multi-million dollar business opportunity for our state. It represents a new responsible economic effort to revitalize our state, develop our economy, and create new jobs for Alaskans.

So, will you please take time, right now, within 48 hours, to write a letter of support for SB230.

Please write your letter on letterhead and then either scan and email back as a PDF to marykatzke@gci.net or fax it to 907-783-2625. We do not have time to trust your letter reaching us by mail in time.

Letter Format:

Address it to:

Senator Johnny Ellis, Chairman

Senate Labor & Commerce Committee

State Capitol

Juneau, AK 99811-1182

Re: SB 230 - Alaska Film Incentive Program

Paragraph 1-

Who you are (company, organization, position)

Paragraph 2-

How you or your business has or could benefit from film or television productions in Alaska. What will it mean for you to have a viable and lucrative

film and television industry in Alaska and your community.

Paragraph 3-

Thanking Sen. Ellis for sponsoring SB230.

Sign and email- that's it!

PLEASE act quickly- we have ONE chance to make a big impression- our team flies to Juneau next week. We want to send a stack of letters with them.

Thanks so much- let's change the landscape of film production in Alaska - and get those Alaskan stories out of Canada and Washington where they have attractive film incentive programs in place.

Carolyn Muegge-Vaughan

President, Alaska Film Group

Jonathan Bowerbank · January 23, 2008

Right on Michael, I've also forwarded this to a couple people who I know do a lot of shooting up in Alaska.

January 23, 2008

So you want to compete against us Canadians on the tax credit front, eh? :D

Well good luck with that, it's a scheme Canada invented and US states are only now just starting to wake up to. What type of rate are you looking at? It will be tough for you to go up against Ontario with its 45% rebate on labour. And you'll never beat Saskatechewan, they have a 50% rebate on all labour! Which means you can fly in a US crew and get the rebate on their labour as well, it's the most aggressive program in North America. Have a look:

http://www.saskfilm.com/1456036?PAGEID=4&G=2

States like NC have a tax credit program but you have to spend a minimum of 250K in NC and then it's only 15%.

I doubt very much Alaska will be competitive at this game considering the remote location.

Also, while the Canadian dollar is high right now against the US dollar, this could change in a year especially with Bush having less than a year left in office. The US dollar is expected to rally once Bush is gone forcing the Canadian dollar back down. Which will make Canadian location even more attractive again.

Just some things to think about.

R,

Michael K Bergstrom · January 23, 2008

25% transferable tax credit, if you spend 50K or more. I think that's fairly good for "small" state. We are not trying to take away business, but rather take the business that is rightfully ours. There are so many things now shot that are supposed to take place in Alaska, and are shot elsewhere (such as Canada). We are trying to make it so that those who have those shows, are able to shoot in Alaska for real. We have the equipment, the infrastructure, the crew, and the experience. Let us help you create your vision.

Film productions in AK will never owe corporate income taxes, as a limited liability corporation is formed for each film produced. Under this legislation, the state will offer a transferable tax credit that is certified by the Department of Revenue and redeemable by film productions. A producer would apply to the Department of Revenue, which would grant a transferable tax credit based on the money spent on qualified production expenditures, which is well-defined in the legislation.

The Department issued tax credit certificate can be sold to any corporation operating in AK, which pays AK corporate income taxes (oil companies, Native Corporations, mining companies, cruiselines, phone companies, etc.) and can be applied against their tax liability. It can be spent in the year purchased or in a future year when these corporations know they will be incurring a large tax liability. The tax credit certificate from Dept. of Revenue is transferable to these taxpayers through a brokerage system.

This is very similar to the mechanism currently in place for the oil producers to purchase transferable tax credits under the old petroleum production tax (PPT) system. It is important to note that tax credits will be issued after the production has completed filming in AK and only after a through audit of those expenses by an independent auditor. We are proposing to create and foster a new industry and jobs for AK.

It authorizes a 25% transferable tax credit and gives additional incentives for productions that are filmed in rural areas of the state or during the shoulder seasons, October-April. Economic Development shall cooperate with organizations in the private sector for the expansion area; and an additional one percent of qualified expenditures made in the state between October 1 and March 30. Every aspect of production is covered from airfare to the state to indirect expenses.

Edited January 23, 2008 by Michael K Bergstrom

January 23, 2008

There are so many things now shot that are supposed to take place in Alaska, and are shot elsewhere (such as Canada).

Yeah but that's the game, LA has been screaming foul over "run away" productions for years. And not just the ones that go to Canada, but the ones that go to other US states. The US south I predict is the next frontier.

If you really want this to work you have to undercut BC and Alberta. Otherwise people will still shoot there and call it "Alaska" the scenery looks the same so why bother going to Alaska if the tax rebate is higher in a Canadian province.

Oh and one other kicker about tax credits. If crews, rental houses, and location owners, know about a tax credit they raise their prices. They figure if you're getting 25% back, they'll increase their rates by say 20%. The total savings are never as much as producers would hope. It's a common problem when regulators step into the free market, there is always some thing else that happens.

R,

Michael K Bergstrom · January 24, 2008

If you really want this to work you have to undercut BC and Alberta. Otherwise people will still shoot there and call it "Alaska" the scenery looks the same so why bother going to Alaska if the tax rebate is higher in a Canadian province.

Just found out that it is a 37% Tax Credit. Also, the scenery does not look the same. We can offer a range between city, beach, ocean, mountains, volcanoes, deserts, tundra, mining towns, glacier ice fields, and temperate rainforest, and much more.

I'm not actually quite sold on the idea yet. I don't believe that we have the structural infrastructure to handle a large scale production yet. The danger we might run into is the same problem happening with the New Mexico Film program, where they're getting the productions, but don't have the infrastructure to handle it. We need to proceed slowly. It is the truth that it will still be more expensive than Canada, but I think that if you truly wish to show Alaska, you should show Alaska, anyone that has shot there knows that the true scenery cannot be replaced or substituted. Granted, I don't see a film being shot up here that takes place all in city, this is very much a place for the man vs. wilderness or himself type of project. But I could be wrong.

January 24, 2008

37% is pretty darn good.

And yes you have the edge in volcanoes, none of those in Canada I don't think?

The lack of studio space may be a problem. But for people shooting all outdoors they would fine especially in the summer months.

Alaska has many pluses no doubt about that. But do they serve cow meat in McDonald's burgers in AK or moose meat?

R,

Michael K Bergstrom · January 24, 2008

Alaska has many pluses no doubt about that. But do they serve cow meat in McDonald's burgers in AK or moose meat?

Mainly tourists that don't leave before it snows.

Michael Collier · January 24, 2008

Alaska has many pluses no doubt about that. But do they serve cow meat in McDonald's burgers in AK or moose meat?

Hahaha, do they serve cow meat in McD's in the lower 48 or canada? I doubt it...it looks like meat, but sometimes I am not so sure.

You can get burgers with moose (or better caribou or reigndeer meat) from local restaraunts. I was at Chair 5 in Girdwood today and was tempted on a caribou burger.

We have lots of opportunity for studios in Alaska, you just gotta know where to look. We have so much industrial warehouse space that ebs and flows as a result of the variency in petroleum construction that usually you can find a pretty big warehouse with TONS of electric for cheap. No dedicated studios....yet.

The other advantage is how open the state is to shooting. There is really very little red tape anywhere. Find a location in this state and I bet you I can get you a permit to shoot there within a day, two tops. And it won't cost an arm and a leg. In fact, I think producers would be VERY surprised to find out what kind of locations can be had for next to nothing. Bergstrom knows what I'm talking about.

Also housing talent is surprisingly cheap. Where in some states you might need to house them in the nicest 500/night hotel, in Alaska you can put them up in a $150/night B&B and watch even the most diva A-lists mouth drop when they see the view outside their window.

Bottom line though, if you haven't seen alaska, schedule a trip, just for siteseeing. In a second you'll understand the film making potential our state has. Plus 20 hours of light aint bad.