Changes to incentives fuel unease in film world
The Alberta film industry is worried changes to government incentives for the film industry aren’t enough to keep the province competitive with the rest of the country.
As expected, the United Conservative Party government will phase out the screen-based production grants in exchange for a film tax credit. This change, which the UCP announced in its election platform, was welcomed and anticipated by the industry. But the budget also said eligible production companies would be able to receive assistance worth 22 per cent of eligible expenditures, which is down from 30 per cent. There will also be a cap of $10 million per project, which is up from the $7.5-million cap imposed by the previous government.
“The transition to a film tax credit was a platform commitment, which provides long-term stability, helps attract large scale productions and is more in line with other provinces,” Justin Brattinga, Economic Development, Trade and Tourism press secretary, said in an email. “With the film and television tax credit, we are maintaining the same level of funding as the previous screen production grant and look forward to working with the film sector to grow and expand.”
Due to oversubscription from the previous grant-based program, however, new money for film tax credits will only be $15 million in the 2020-21 fiscal year, $30 million in 2021-22 and $45 million in 2022-23. Total money between the two programs will be capped at $45 million per year as the government makes the transition, matching the total of grants per year by the previous program.
Members of Alberta’s film industry are concerned that it will be hard for the industry to maintain its current level of production with only $90 million in new money coming in over the next four years. Grants for the portion of the previous program that was oversubscribed include projects that were completed in previous years.
“That means we attracted many more productions than we allocated funding for,” said Luke Azevedo, Calgary Economic Development film, television and creative industries commissioner. “In most industries, when you’re attracting more than what you thought you were going to bring in, it’s a good thing. They’re bringing more money, they’re hiring more people, they’re leaving more money behind, they’re developing an industry at a quicker rate. In the film and television industry, because there is a limit in our province and not many others, there is a cap allocated per project and then an overall cap per year, it is much more difficult for us to continue to grow the industry.”
Azevedo said this year was likely the biggest year ever for film and television production in Alberta. Major productions in the province included the new Ghostbusters movie, which filmed in and around Calgary. He estimated the industry will do more than $300 million in business this year, which puts us fourth in the country behind heavyweights B.C., over $4 billion; Ontario, over $3 billion; and Quebec, around $2 billion. Manitoba — around $270 million in business, according to Azevedo — is just behind and threatening to pass Alberta. B.C., Ontario, Quebec and Manitoba, all of which employ tax credits the Alberta government is emulating, do not have annual caps on its credits, said Azevedo.
He said that while the government considers the tax credit and previous grant program an expense competing with priorities like health and education, it should really be looked at as a way to increase revenue and diversify the province’s economy. Azevedo pointed to a study commissioned by Filmontario, which estimated for every dollar the government paid in tax credits, the government received $1.20 in tax revenue back.