I got curious and have been doing some digging myself. (I’ve been dumping stuff onto some webpages at http://www.oberst.ca/filmcredit )
“Production volume” is a synonym for total budget, is NOT the same as “total spend in province”. The CMPA $122 million is problematic in that productions are assigned to the province of their majority partner. This certainly suggests that something like “Haven” has been included in Ontario, not Nova Scotia. Conversely, a coproduction like “Book of Negroes” includes its entire budget as production volume, including all spending in South Africa, etc. At the provincial level, CMPA’s production volume is probably a bit shaky, and the greater the number of projects with significant non-local spend, the further things get from “provincial spend”.
The government’s Film & Creative agency also provided “production volume” estimates in their annual report; their number for 2013-14 was $139 million, not the CMPA $122 million. This may have been an attempt to correct for “Haven”-like misallocation, but no methodology was given. Nor has the government given any reason why they don’t use that number instead of the CMPA .
The CMPA estimates a bit over $30 million of “broadcaster in-house” volume (news, sports, etc.). Presumably most of that is spent locally. That would leave about $40M of of $139M in volume, and some of that would be non-local spend. The local, non-broadcast, non-credit spend would be rather less, and it seems fair to assume some of that would not be viable without the presence of the larger community enabled by tax-credit productions.
I’m not sure what is truly different fiscally about the new system, except the optics. Assume local spend is 50/50 labour/other (CMPA makes that assumption for FTE estimates). 65% best case rebate of labour is 33% of local spend, not much different from 30% of local spend in the new best case. It will depend on exactly what is eligible and what the actual labour/other ratios are, but the two formulas would seem to be at least in the same wide ballpark. To keep existing levels of production, something not far from existing expenditure will be required. Excluding animation and calling it around $20 million, a $10 million “cap” implies the new fund could only sustain around half the existing tax-credit productions.
The whole “cap” thing seems problematic, since uncertainty about whether money would actually be available would drive some productions elsewhere. My understanding is that Alberta has never “run out” of money for eligible productions, but if Nova Scotia isn’t willing to fund whatever level of production the new system can attract, it seems like a recipe for confusion, or worse.
Like it or not, in the current world significant film and television production will not locate here without some funding mechanism similar to what they can receive in BC, Ontario, Manitoba, Quebec or Alberta. Aside from the various other benefits, one should be honest that one is buying GDP activity, and establish at what price that is a benefit to the province, and the government’s balance sheet (two different things), compared to not having it at all. Manitoba ran an economic analysis of its own industry – it would seem to suggest that combined tax revenue might be about 20% of local spend. The question becomes how much above that (or whatever the actual return is) are the various other tangible and intangible benefits worth.
Unfortunately, the government/Department of Finance appears to be actively avoiding providing basic historical summary information from the tax credit program, which might help clear the picture some.
Ms. Beatty: Thank you for your clarification. I am glad to hear someone finally admit there are profits being pocketed during the process. You refer to profits from future sales. Are you suggesting there are no profits from original sales?
Given the importance that Nova Scotian taxpayers are to the entire process why do they not share in the profits from future sales?? Taxpayers are not even taking the risk they are just giving out money. Maybe the industry should be more willing to make the province whole, and be willing to share prosperity rather than just taking from the province.
1. Each standalone project is owned by a producer or production company. Those are the companies that claim any profit from future sales, pay taxes, and have built reputations over time that attract equity investors.
2. All of the financing plans for these standalone projects include a line for Producer Investment as a key part of financing.
3. Those 3 explanatory videos were made by a couple of SNS board members on their own time.
There is more information online about how the Canadian film industry works. A good place to start is Telefilm Canada.
Ms. Beatty: I have watched the you tube video. The corporate structure is not that complex, neither is the process. I was surprised that at one stage the video implies, as I recall it, that those involved in the financing process prefer a new company rather than one that existed for 28 years. I think that is fundamentally wrong.
Those involved in the financing process definitely want years of stability and want a history of financial achievements. Given the lack of history of the “entity” applying for the financing I can understand the investors/ lenders, etc, telling these new “enities” they are a high risk and therefore they are reluctant to put money in under that structure.
Another element that Investors/ lenders look for is what has the requesting entity got in the game — how much are they investing— sounds like through the video the owners are investing nothing. Their risk is ZERO.
It strikes me that creating a new entity is the problem not the solution to part of the industry’s problems in getting financing.
So the “old” structure works like this— owners have no risk but get all the profit/ benefit, lenders take on low risk financing with NS taxpayers providing subsidizing, and NS taxpayers get hosed with no opportunity to share in the returns.
Change is required and I can understand why the industry wants to fight the change. They recognize a golden egg when they see it.
I could not help but wonder when I watched the video—- do these qualify for the tax credit??? I am afraid to find out the answer to that.
Barry H – I know, it’s a bit complex, like any industry. But take a moment to follow the link to the clear, detailed, 3 part explanation provided by Screen Nova Scotia illustrating how tax credits work in the film industry (throughout North America, not just in NS). You’ll see why the financing provided by the province is a crucial piece to attracting the other funding needed to produce film/tv (I.e. Telefilm and Canadian Media Fund, broadcast licenses or distribution deals).
Erika Beatty makes the following statement “Provincial tax credits often serve as a catalyst to draw other financing. ”
When Investors/ Lenders/ Financiers look at providing financing they assess the risks associated with the deal. Will they get their money back?? Any financial institution looking at an opportunity with an entity qualifying under the former NS Tax give away is going to conclude the risks are significantly lower when NS taxpayers are subsidizing the costs. It is not rocket science.
It does not mean as implied by Ms Beatty seems to imply that ‘other financing” will not be available if the tax credit is reduced or eliminated. It means that the financing institution will come up with a different assessment of risks and would structure the deal differently.
That is what is fundamentally wrong with ongoing subsidizations of an industry. The taxpayers keep paying in and industry keeps taking out. There is never a true assessment of risks and a determination if the industry can become self supporting. If “other financing” can only be obtained if taxpayers keep putting in; then label the taxpayers as suckers, because the financial institutions are telling us the industry is not sustainable on its own.
The industry wants us to believe that this $26 m give away provides Nova Scotians a substantial return. Using that theory I guess we should invest $500M of taxpayer money and our return would be so great that we could pay off all our $15B in debt in 20 years. Just like Sydney Steel did.
Bill: Re FITC- your question about whether this is leading to a self-sufficient business is most relevant, otherwise we are engaged in an ongoing subsidy. Jim.
Bill – there is something a little off about this statement (from your part 2 article):
“…It would appear that this substantial portion of the $122 million of production, and related jobs, did not receive provincial subsidies, and therefore might not be vulnerable to a reduction in subsidies it is not receiving.”
Provincial tax credits often serve as a catalyst to draw other financing. They are a key to unlocking other investment, and if changed the way the government is proposing, NS projects will become ineligible for other financing and unattractive to other investors. For details refer to the letter to the NS Minister of Finance from the head of the Canadian Media Fund last week. So yes, a reduction in provincial subsidy will substantially reduce the amount film industry will be able to spend in NS in the future. A $6m or $10m provincial investment cannot generate the $122m (or $67m, or $150m) the film industry spent mostly as a result of the $24m tax credit. Then, the dropping provincial spend will mean even the $10m (or $6m) investment will no longer be justified. And so the slide down the slippery slope begins.
A good explanation of this and how film financing works as a whole was created by SNS and shared in 3 short animated clips last week. Anyone honestly curious about how the pieces fit together should try watching all three: http://youtu.be/4vQ3L2XZZJ0
Bill – here is a link to the 2008 report by Canmac Economics. To oversimplify, it affirms (among other things) the 2700 FTE jobs and $150m figures the industry has been quoting.
As usual the pro tax subsidy advocates accuse everyone else of having “bad” numbers and not understanding the industry. That is a sad defense as to why taxpayers should subsidize an industry uh that cannot prove its value or contribution to the society it wants to bleed money out of.
Where is the business plan that makes this a sustainable, non subsidized industry?
For those who want to compare it to creating gold, substitute the word steel for gold and maybe you will getter picture as to why taxpayers are concerned about lifetime subsidies and the harm they have done to Nova Scotia.
The case is not fanciful it is a fantasy, and that would appear to be what happens when creative minds delve into the real world.
And for those who believe there are better incentives elsewhere, why are you still here..? Go to the greener grass, and then maybe you will understand just how good it was here.
I believe Bill B. Has presented a fair and balanced assessment of the situation.
I’m not quite sure who the “bad actors” are in the Film Industry that you speak of. The spokespeople you’ve seen the most of are quite squarely in the middle class, and have been arguing a very factual case that keeps getting validated by outside examination. Sure, I imagine the stars of the Trailer Park Boys are doing quite well, but there’s nothing wrong with that.I’m sure they pay a lot of tax too. They’re no John Risleys, that’s for sure.
Let’s use a fanciful analogy for a second: If the govt. could spend 25 million dollars to somehow create 150 million dollars worth of gold in the ground in Nova Scotia where no gold existed before, and then insure that the miners who worked to extract it were all Nova Scotian, and that all of that 150 million dollars in revenue was then spent in Nova Scotia, and also taxed in Nova Scotia, they would jump on that opportunity 100% of the time. Even better, they can do it over and over again every year, and have the amount of gold increase over time.
Now of course you can’t do this with gold, but amazingly, you CAN do this with Film and TV production. There is not a fixed amount of it in the ground: it increases because of growth in infrastructure, especially in the pool of skill and talent.It increases as it gains a reputation for delivering consistent quality. And also unlike gold in the ground, it can simply disappear, move away to another place.IWhy would we limit this growth by abitrarily picking a number we can “afford”? The more we spend on a FTC, the more we get back.This may not be the case everywhere, but it works here.
To address one of your points about the numbers : Much of the tertiary activity in the industry, production that does not directly access the FTC and as such was not included in the Dept. of Finance’s numbers, still owes much of it’s existence to the activity that the FTC directly supports, and much of it will disappear if that activity shrinks.Those productions are undertaken by people who derive much of their living from FTC funded production, and who are only still in Nova Scotia due to the presence of a strong industry. There is absolutely no historical background for the existence of a Film and TV industry in Nova Scotia, as it was built from the ground up and it’s growth can actually be tracked by tracking the increase in the total amount of the FTC year to year. There is absolutely no reason for it to stay when there are other places with better incentives.
So the situation is that you can create a renewable industry where none existed before, with a Government program which is most likely cost neutral at worst.Now fast forward 20 years, and that industry has grown steadily, and provided steady returns, which also seems to survive the wiles of global economic slowdowns, fluctuations in the dollar and the price of oil. How in the heck does it make any sense whatsoever to break this cycle of growth for imagined short term savings? Even worse, it’s being done when an entire generation of young Nova Scotians who have grown up here, gone to school here, and worked in the industry here are about to fully take hold of it, with the potential to create homegrown success the like of which we haven’t seen yet that can be exported around the world.
Also, on the point of transparency: I think the exact opposite has happened. We are moving from an open, non-partisan, equal access incentive, to a managed fund. A fund managed by NSBI, whose newly minted President and CEO Laurel Broten is the very epitome of a Liberal party insider : former Liberal Cabinet Minister in Ontario, and also the very well paid author of the tax review that McNeil’s Liberals seem to be mostly ignoring now. One would have to be extremely naive to not see how this can become another political money trough. And there was never much difficulty finding out who got money from the old FTC: productions would proudly announce this support in their credits, right after the names of all the Nova Scotians who worked on it.
Rob your comment is only distantly acquainted with the relevant facts.
The government is not subsidizing $150 million of production, it is subsidizing $66.8 million of production.
The money earned by the artists is spent on all kinds of things that are not produced in Nova Scotia–cars, phones, TV’s, clothes, most of the food we eat.
The industry holds is not even expected to become self-sustaining.
Michelin exports about $1 billion of tires from Nova Scotia in a year. Using your logic the province should be paying Michelin $250 million per year, for ever.
If your logic is correct what private employers would not qualify for a rebate of some kind? Where on earth would the money come from?
Hi Mr. Black – there are errors of logic in your piece. I’d be happy to walk you though the peculiar nature of the film and tv business.
The $55.2 Mil you quote would be venerable as that money is triggered by productions the receive the TC. In general terms a budget is often built around 20% in Provincial TC’s, 10-15% Federal TC’s, 20% CMF, 20-30% broadcaster fees, and the rest made up of equity investments, international pre-sales etc.
Just as infrastructure projects use provincial spending to trigger Federal money, the TC triggers those inflows to the province.
But I will add something that rarely gets mentioned – US productions are sold to Canadian broadcasters for often less than 10% of their production costs – so imagine if Ford could sell F150 pickup trucks in Canada for $1500.00 -(one thousand five hundred) that would be considered dumping under NAFTA etc. So besides competing against a world-wide cultural juggernaut, we do so without the benefit of distance, language or even accent to distinguish us and sold in this country at much less than the cost of production.
Bill, I am not sure what the following sentence concludes. “Local TV news, sports, weather, and current affairs programming probably make up a part of it, and are unlikely to be affected. ”
Are you saying it is likely or unlikely that Local tv…….. get the tax credit???? That’s CBC, CTV, Global, TSN etc????
That there is even a possibility that those organizations qualify for our tax money shocks me.
Thanks
I believe the Digital Media Payroll Rebate program under the Finance Department may be more generous than the proposed Film Tax Credit. There are of course many different clauses but IIRC it is approximately 35% of eligible payroll costs with a 10% bonusing outside of Halifax.
A major difficulty in understanding this match up between the McNeil Gov’T and the film industry is that there appear to be ‘bad actors’ in leading rolls on both stages.(no pun intended) On the larger stage, it would seem to be long past time that this administration started playing a Leading. role…
I got curious and have been doing some digging myself. (I’ve been dumping stuff onto some webpages at http://www.oberst.ca/filmcredit )
“Production volume” is a synonym for total budget, is NOT the same as “total spend in province”. The CMPA $122 million is problematic in that productions are assigned to the province of their majority partner. This certainly suggests that something like “Haven” has been included in Ontario, not Nova Scotia. Conversely, a coproduction like “Book of Negroes” includes its entire budget as production volume, including all spending in South Africa, etc. At the provincial level, CMPA’s production volume is probably a bit shaky, and the greater the number of projects with significant non-local spend, the further things get from “provincial spend”.
The government’s Film & Creative agency also provided “production volume” estimates in their annual report; their number for 2013-14 was $139 million, not the CMPA $122 million. This may have been an attempt to correct for “Haven”-like misallocation, but no methodology was given. Nor has the government given any reason why they don’t use that number instead of the CMPA .
The CMPA estimates a bit over $30 million of “broadcaster in-house” volume (news, sports, etc.). Presumably most of that is spent locally. That would leave about $40M of of $139M in volume, and some of that would be non-local spend. The local, non-broadcast, non-credit spend would be rather less, and it seems fair to assume some of that would not be viable without the presence of the larger community enabled by tax-credit productions.
I’m not sure what is truly different fiscally about the new system, except the optics. Assume local spend is 50/50 labour/other (CMPA makes that assumption for FTE estimates). 65% best case rebate of labour is 33% of local spend, not much different from 30% of local spend in the new best case. It will depend on exactly what is eligible and what the actual labour/other ratios are, but the two formulas would seem to be at least in the same wide ballpark. To keep existing levels of production, something not far from existing expenditure will be required. Excluding animation and calling it around $20 million, a $10 million “cap” implies the new fund could only sustain around half the existing tax-credit productions.
The whole “cap” thing seems problematic, since uncertainty about whether money would actually be available would drive some productions elsewhere. My understanding is that Alberta has never “run out” of money for eligible productions, but if Nova Scotia isn’t willing to fund whatever level of production the new system can attract, it seems like a recipe for confusion, or worse.
Like it or not, in the current world significant film and television production will not locate here without some funding mechanism similar to what they can receive in BC, Ontario, Manitoba, Quebec or Alberta. Aside from the various other benefits, one should be honest that one is buying GDP activity, and establish at what price that is a benefit to the province, and the government’s balance sheet (two different things), compared to not having it at all. Manitoba ran an economic analysis of its own industry – it would seem to suggest that combined tax revenue might be about 20% of local spend. The question becomes how much above that (or whatever the actual return is) are the various other tangible and intangible benefits worth.
Unfortunately, the government/Department of Finance appears to be actively avoiding providing basic historical summary information from the tax credit program, which might help clear the picture some.
David Oberst | May 4, 2015 |
David thank you for this very valuable contribution.
Bill Black
Bill | May 4, 2015 |
Ms. Beatty: Thank you for your clarification. I am glad to hear someone finally admit there are profits being pocketed during the process. You refer to profits from future sales. Are you suggesting there are no profits from original sales?
Given the importance that Nova Scotian taxpayers are to the entire process why do they not share in the profits from future sales?? Taxpayers are not even taking the risk they are just giving out money. Maybe the industry should be more willing to make the province whole, and be willing to share prosperity rather than just taking from the province.
Barry H | May 2, 2015 |
Hi again Barry. Good points.
1. Each standalone project is owned by a producer or production company. Those are the companies that claim any profit from future sales, pay taxes, and have built reputations over time that attract equity investors.
2. All of the financing plans for these standalone projects include a line for Producer Investment as a key part of financing.
3. Those 3 explanatory videos were made by a couple of SNS board members on their own time.
There is more information online about how the Canadian film industry works. A good place to start is Telefilm Canada.
Regards.
Erika Beatty | May 1, 2015 |
Ms. Beatty: I have watched the you tube video. The corporate structure is not that complex, neither is the process. I was surprised that at one stage the video implies, as I recall it, that those involved in the financing process prefer a new company rather than one that existed for 28 years. I think that is fundamentally wrong.
Those involved in the financing process definitely want years of stability and want a history of financial achievements. Given the lack of history of the “entity” applying for the financing I can understand the investors/ lenders, etc, telling these new “enities” they are a high risk and therefore they are reluctant to put money in under that structure.
Another element that Investors/ lenders look for is what has the requesting entity got in the game — how much are they investing— sounds like through the video the owners are investing nothing. Their risk is ZERO.
It strikes me that creating a new entity is the problem not the solution to part of the industry’s problems in getting financing.
So the “old” structure works like this— owners have no risk but get all the profit/ benefit, lenders take on low risk financing with NS taxpayers providing subsidizing, and NS taxpayers get hosed with no opportunity to share in the returns.
Change is required and I can understand why the industry wants to fight the change. They recognize a golden egg when they see it.
I could not help but wonder when I watched the video—- do these qualify for the tax credit??? I am afraid to find out the answer to that.
Barry H | May 1, 2015 |
Barry H – I know, it’s a bit complex, like any industry. But take a moment to follow the link to the clear, detailed, 3 part explanation provided by Screen Nova Scotia illustrating how tax credits work in the film industry (throughout North America, not just in NS). You’ll see why the financing provided by the province is a crucial piece to attracting the other funding needed to produce film/tv (I.e. Telefilm and Canadian Media Fund, broadcast licenses or distribution deals).
http://youtu.be/4vQ3L2XZZJ0
I hope that helps.
Erika Beatty | April 30, 2015 |
Erika Beatty makes the following statement “Provincial tax credits often serve as a catalyst to draw other financing. ”
When Investors/ Lenders/ Financiers look at providing financing they assess the risks associated with the deal. Will they get their money back?? Any financial institution looking at an opportunity with an entity qualifying under the former NS Tax give away is going to conclude the risks are significantly lower when NS taxpayers are subsidizing the costs. It is not rocket science.
It does not mean as implied by Ms Beatty seems to imply that ‘other financing” will not be available if the tax credit is reduced or eliminated. It means that the financing institution will come up with a different assessment of risks and would structure the deal differently.
That is what is fundamentally wrong with ongoing subsidizations of an industry. The taxpayers keep paying in and industry keeps taking out. There is never a true assessment of risks and a determination if the industry can become self supporting. If “other financing” can only be obtained if taxpayers keep putting in; then label the taxpayers as suckers, because the financial institutions are telling us the industry is not sustainable on its own.
The industry wants us to believe that this $26 m give away provides Nova Scotians a substantial return. Using that theory I guess we should invest $500M of taxpayer money and our return would be so great that we could pay off all our $15B in debt in 20 years. Just like Sydney Steel did.
Barry H | April 30, 2015 |
Bill: Re FITC- your question about whether this is leading to a self-sufficient business is most relevant, otherwise we are engaged in an ongoing subsidy. Jim.
Jim Radford | April 29, 2015 |
Bill – there is something a little off about this statement (from your part 2 article):
“…It would appear that this substantial portion of the $122 million of production, and related jobs, did not receive provincial subsidies, and therefore might not be vulnerable to a reduction in subsidies it is not receiving.”
Provincial tax credits often serve as a catalyst to draw other financing. They are a key to unlocking other investment, and if changed the way the government is proposing, NS projects will become ineligible for other financing and unattractive to other investors. For details refer to the letter to the NS Minister of Finance from the head of the Canadian Media Fund last week. So yes, a reduction in provincial subsidy will substantially reduce the amount film industry will be able to spend in NS in the future. A $6m or $10m provincial investment cannot generate the $122m (or $67m, or $150m) the film industry spent mostly as a result of the $24m tax credit. Then, the dropping provincial spend will mean even the $10m (or $6m) investment will no longer be justified. And so the slide down the slippery slope begins.
A good explanation of this and how film financing works as a whole was created by SNS and shared in 3 short animated clips last week. Anyone honestly curious about how the pieces fit together should try watching all three: http://youtu.be/4vQ3L2XZZJ0
Erika Beatty | April 29, 2015 |
Bill – here is a link to the 2008 report by Canmac Economics. To oversimplify, it affirms (among other things) the 2700 FTE jobs and $150m figures the industry has been quoting.
I hope it helps the discussion.
http://halifaxbloggers.ca/halifaxlovehate/government-report-calls-film-industry-an-anchor-for-nova-scotias-general-economic-and-social-prosperity/
Erika Beatty | April 29, 2015 |
As usual the pro tax subsidy advocates accuse everyone else of having “bad” numbers and not understanding the industry. That is a sad defense as to why taxpayers should subsidize an industry uh that cannot prove its value or contribution to the society it wants to bleed money out of.
Where is the business plan that makes this a sustainable, non subsidized industry?
For those who want to compare it to creating gold, substitute the word steel for gold and maybe you will getter picture as to why taxpayers are concerned about lifetime subsidies and the harm they have done to Nova Scotia.
The case is not fanciful it is a fantasy, and that would appear to be what happens when creative minds delve into the real world.
And for those who believe there are better incentives elsewhere, why are you still here..? Go to the greener grass, and then maybe you will understand just how good it was here.
I believe Bill B. Has presented a fair and balanced assessment of the situation.
Barry H | April 28, 2015 |
I’m not quite sure who the “bad actors” are in the Film Industry that you speak of. The spokespeople you’ve seen the most of are quite squarely in the middle class, and have been arguing a very factual case that keeps getting validated by outside examination. Sure, I imagine the stars of the Trailer Park Boys are doing quite well, but there’s nothing wrong with that.I’m sure they pay a lot of tax too. They’re no John Risleys, that’s for sure.
Let’s use a fanciful analogy for a second: If the govt. could spend 25 million dollars to somehow create 150 million dollars worth of gold in the ground in Nova Scotia where no gold existed before, and then insure that the miners who worked to extract it were all Nova Scotian, and that all of that 150 million dollars in revenue was then spent in Nova Scotia, and also taxed in Nova Scotia, they would jump on that opportunity 100% of the time. Even better, they can do it over and over again every year, and have the amount of gold increase over time.
Now of course you can’t do this with gold, but amazingly, you CAN do this with Film and TV production. There is not a fixed amount of it in the ground: it increases because of growth in infrastructure, especially in the pool of skill and talent.It increases as it gains a reputation for delivering consistent quality. And also unlike gold in the ground, it can simply disappear, move away to another place.IWhy would we limit this growth by abitrarily picking a number we can “afford”? The more we spend on a FTC, the more we get back.This may not be the case everywhere, but it works here.
To address one of your points about the numbers : Much of the tertiary activity in the industry, production that does not directly access the FTC and as such was not included in the Dept. of Finance’s numbers, still owes much of it’s existence to the activity that the FTC directly supports, and much of it will disappear if that activity shrinks.Those productions are undertaken by people who derive much of their living from FTC funded production, and who are only still in Nova Scotia due to the presence of a strong industry. There is absolutely no historical background for the existence of a Film and TV industry in Nova Scotia, as it was built from the ground up and it’s growth can actually be tracked by tracking the increase in the total amount of the FTC year to year. There is absolutely no reason for it to stay when there are other places with better incentives.
So the situation is that you can create a renewable industry where none existed before, with a Government program which is most likely cost neutral at worst.Now fast forward 20 years, and that industry has grown steadily, and provided steady returns, which also seems to survive the wiles of global economic slowdowns, fluctuations in the dollar and the price of oil. How in the heck does it make any sense whatsoever to break this cycle of growth for imagined short term savings? Even worse, it’s being done when an entire generation of young Nova Scotians who have grown up here, gone to school here, and worked in the industry here are about to fully take hold of it, with the potential to create homegrown success the like of which we haven’t seen yet that can be exported around the world.
Also, on the point of transparency: I think the exact opposite has happened. We are moving from an open, non-partisan, equal access incentive, to a managed fund. A fund managed by NSBI, whose newly minted President and CEO Laurel Broten is the very epitome of a Liberal party insider : former Liberal Cabinet Minister in Ontario, and also the very well paid author of the tax review that McNeil’s Liberals seem to be mostly ignoring now. One would have to be extremely naive to not see how this can become another political money trough. And there was never much difficulty finding out who got money from the old FTC: productions would proudly announce this support in their credits, right after the names of all the Nova Scotians who worked on it.
Rob Tough | April 27, 2015 |
Rob your comment is only distantly acquainted with the relevant facts.
The government is not subsidizing $150 million of production, it is subsidizing $66.8 million of production.
The money earned by the artists is spent on all kinds of things that are not produced in Nova Scotia–cars, phones, TV’s, clothes, most of the food we eat.
The industry holds is not even expected to become self-sustaining.
Michelin exports about $1 billion of tires from Nova Scotia in a year. Using your logic the province should be paying Michelin $250 million per year, for ever.
If your logic is correct what private employers would not qualify for a rebate of some kind? Where on earth would the money come from?
Bill B
Bill | April 27, 2015 |
Hi Mr. Black – there are errors of logic in your piece. I’d be happy to walk you though the peculiar nature of the film and tv business.
The $55.2 Mil you quote would be venerable as that money is triggered by productions the receive the TC. In general terms a budget is often built around 20% in Provincial TC’s, 10-15% Federal TC’s, 20% CMF, 20-30% broadcaster fees, and the rest made up of equity investments, international pre-sales etc.
Just as infrastructure projects use provincial spending to trigger Federal money, the TC triggers those inflows to the province.
But I will add something that rarely gets mentioned – US productions are sold to Canadian broadcasters for often less than 10% of their production costs – so imagine if Ford could sell F150 pickup trucks in Canada for $1500.00 -(one thousand five hundred) that would be considered dumping under NAFTA etc. So besides competing against a world-wide cultural juggernaut, we do so without the benefit of distance, language or even accent to distinguish us and sold in this country at much less than the cost of production.
Rob Power | April 26, 2015 |
Bill, I am not sure what the following sentence concludes. “Local TV news, sports, weather, and current affairs programming probably make up a part of it, and are unlikely to be affected. ”
Are you saying it is likely or unlikely that Local tv…….. get the tax credit???? That’s CBC, CTV, Global, TSN etc????
That there is even a possibility that those organizations qualify for our tax money shocks me.
Thanks
Barry H | April 25, 2015 |
No Barry. I am saying they are part of the production that is NOT subsidized
Bill | April 25, 2015 |
Hi Bill,
I believe the Digital Media Payroll Rebate program under the Finance Department may be more generous than the proposed Film Tax Credit. There are of course many different clauses but IIRC it is approximately 35% of eligible payroll costs with a 10% bonusing outside of Halifax.
George Hornmoen | April 24, 2015 |
A major difficulty in understanding this match up between the McNeil Gov’T and the film industry is that there appear to be ‘bad actors’ in leading rolls on both stages.(no pun intended) On the larger stage, it would seem to be long past time that this administration started playing a Leading. role…
bob mackenzie | April 24, 2015 |