- Special Projects
Right now, film and TV production is booming in Hawaii, but it’s precarious. The state’s film tax credits are set to be capped at $35 million starting on Jan. 1, 2019.
Any cap is dangerous, as it means productions are reluctant to bring shows here. The $35 million cap is also far too low, and will most likely result in a substantial decrease in productions. In 2017, the state paid out $55 million, and is set to pay out more for 2018. That’s a lot of money, to be sure, but it brings in exponentially more in economic benefit to Hawaii.
We are a valuable, thriving, and growing industry. Local people are busy working good jobs on “Hawaii 5-0” and “Magnum, P.I.”, and feature films. Graduates of the University of Hawaii’s Academy of Creative Media are working entry level jobs on Hollywood blockbusters. Hotels and restaurants, hardware stores and equipment vendors are doing brisk business.
I am not a neutral observer. I am a member of the International Alliance of Theatrical and Stage Employees, chapter 665. I’ve worked my way up on film and TV productions, everything from local commercials, low budget independent features, to the latest blockbusters. I’ve seen firsthand the benefits of having the industry, and lived the consequences of not having enough work.
And now, not only is the fate of the production business uncertain, lawyer and producer Tim Chey has filed a lawsuit against the film office, alleging an anti-Christian bias that prevented him from getting tax credits for his production of “The Islands.” In his complaint for damages, he’s asking “for an Injunction requiring the Hawaii Film Office to cease any and all operations until the FBI, Hawaii Attorney General, (the) Honorable U.S. District Court, and State Legislature clear the Defendants and the Hawaii Film Office of any wrongdoing.”
Tim Chey isn’t someone shy about using the legal system. He’s sued Netflix, claiming they owed him “an absolute minimum of $10,000,000” because they declined to carry his film “Suing the Devil.” He lost.
He sued Orbitz and Air China, claiming they didn’t properly inform him that he needed a visa to travel to Brazil. He lost.
He sued Pure Flix Entertainment, a Christian faith-based media streaming company, claiming they stole his idea for “God’s Not Dead.” He lost.
Currently, he’s engaged in a lawsuit against Facebook in a dispute over ads he purchased. Lawyers for Facebook filed for a motion for summary judgment April 13. His lawyers objected. On June 21, his lawyers filed for a dismissal of the lawsuit (that he started). The case is still active.
I’m not a lawyer, and I do not know whether his lawsuit has any merit. I do know people who worked on his production of “The Islands,” and the people I know weren’t making the “$500 to $700 a day” he quoted to Civil Beat. Tim Chey has also sued the producer and caterer on that production. It’s a shame that his lawsuit, and the one-sided press coverage about it, has maligned the film production business in Hawaii.
Our industry is unique. It supports an entire ecosystem of businesses, laborers, and artists. Major TV shows and movies, aka, the “big shows,” and the outside money they bring to the state, are vital to sustaining and growing our community. Not only is the economic impact tremendous, but it creates the environment necessary for locally produced independent films to get made, and get made well.
The tax credits do not exist to be a subsidy for Johnny Depp’s salary. They are designed as a rebate on money already spent, and taxed, in Hawaii. It’s far and away different than the sweetheart deal New York just gave Jeff Bezos for bringing in Amazon’s headquarters. The state-designed system in place monitors the expenditures of each movie. If, as the state’s 2016 audit suggests, there are problems with accounting and auditing processes, those problems should be remedied, not used as an excuse to scrap the whole program.
The state tax credits do not exist to be a subsidy for Johnny Depp’s salary.
Think of any major motion picture shooting in Hawaii as one tourist. They come, dump money into the economy, and leave. And when they leave, the landscape is the same.
One example: While shooting “Kong: Skull Island,” the rigging grip department was tasked with building a staircase on the Manoa Falls trail. That was a crew of about a dozen people, working 12-hour days, making their full rate, with overtime. That’s three drivers, three medics, two location reps, all locals. That’s rental fees for trucks, heavy equipment, and stage truss, all rented from local companies. That’s $1,865 in lumber from Hardware Hawaii.
When it was done, the staircase was taken apart, and the lumber donated to Re-use Hawaii. That’s thousands of dollars spent, on one set, by one department (out of many), on one production.
When the mainland crew flies away, while the hardware stores and restaurants and hotels deposit their cash. Locals employed go home with decent paychecks. Hawaii isn’t paying for corporations to have helipads. Rather, money goes into the hands of locals who spend it. And when it’s all over, Hawaii looks the same. Sometimes better. The Boy Scout rule applies: Leave a place better than you found it.
“Jurassic World: Fallen Kingdom” paid $193,725 to use Heeia Kea pier from June 5 to July 3, 2017. Meghan Statts, Oahu district manager of the Department of Land and Natural Resources Boating Division, says the NBC Universal production went “above and beyond” to work with the community. “They held community meetings. They said they wanted to move 50 boats. I said good luck.”
Yet, the production individually negotiated with each boat owner. For the boaters, they built a pier on Coconut Island, and had a boat to get there seven days a week. That’s in addition to paying $1,000 to the boat owners. When the production left, they donated a $38,385.53 security system to the pier.
Big shows pay our bills. Big shows train us. The crews that fly in from across the globe are the top technicians in the industry, employing locals to work with them side by side. On-the-job training opportunities abound. I’m currently working with UH ACM graduates Caleb Baltensperger and Sawyer Chestnut-Pinto are VFX Production Assistants on a big budget feature. It’s worth noting that the 2016 audit of the tax credits was critical that there wasn’t a more formal training and education system linking productions to the tax credits, which is a fundamental misunderstanding of the nature of film production work.
Big shows pay our bills. Big shows train us.
Most training is on-the-job training. Paid jobs are always better than unpaid internships, and as more productions come to Hawaii, more UH grads get hired in entry-level positions. They have the opportunity to move up.
I worked with Erin Lau, an ACM grad, on “Jurassic World: Fallen Kingdom,” where she was a VFX PA. She’s now a Sundance Native Fellow, her film “The Moon and the Night” won second place at HIFF, and because of that film’s success, she’s now represented by United Talent Agency.
“I want to one day get to the ‘Star Wars’-level productions,” she says. Eventually, “the dream is that I’ll have enough influence to bring projects home.”
Talent can’t exist in a vacuum, either. Movies need gear. Cameras, lights, and scores of specialty equipment are needed to make anything look professional. Hawaii Media Inc is a locally owned equipment rental house. During the filming of “Go For Broke,” a locally produced film about the origin of the Nisei fighters of World War II, there was a scene re-creating the climatic march of recruits of Japanese ancestry on Iolani Palace. To get that shot, the producers had access to a telescoping Supertechno crane. It’s a specialty piece of equipment that can move the camera seamlessly. It’s expensive.
Hawaii Media Inc. keeps Supertechno cranes on consignment. They have to send a certain amount of money every time the crane is rented to the Supertechno company in Europe. When HMI rented it to the producers of “Go For Broke,” they did so for the bare minimum, sending all proceeds to the Supertechno company in Europe. HMI didn’t make a dime. If “Hawaii 5-0” and “Magnum, P.I.” weren’t around to rent that crane, HMI wouldn’t have it in stock, and “Go For Broke” wouldn’t have had access to it.
Every ecosystem consists of interconnected elements, each dependent on another to grow and thrive. The film production business in Hawaii is an ecosystem. I believe it’s one that’s beneficial to the state. In the way a lo’i needs a stream, we need these tax credits, and the productions they bring, to grow and thrive.
It puts people to work. It dumps cash into local businesses. It provides opportunities for our young people to pursue their dreams, and it does so all in the form of an industry that doesn’t require permanently changing the landscape of our home.
I hope the judge can put aside Tim Chey’s request for an injunction. I hope our legislators can continue to invest in this business. I have reason to be hopeful, too.
Extending and improving the tax credits were the focus of House Bill 1328 in the last legislative session. The bill passed the Economic Development and Business Committee, which suggested the bill go even further. The EDB Committee said upon passing it, “Should the Committee on Finance deliberate on this measure further, your Committee on Economic Development and Business respectfully requests that it consider increasing the aggregate tax cap or deleting the tax cap in its entirety.”
A full commitment by the state into this business would go a long way to cementing Hawaii as the go-to tropical shooting location in the world. I hope our legislators see the benefits of keeping this thriving industry in Hawaii.
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