There’s No Business Like Show Business

By Cody Worsham

Liza Kelso always knew she’d live in the film capital of the world. What she didn’t know was that capital would be on the Gulf Coast, not the West Coast.

An aspiring film producer, Kelso landed a job on the set of The Adventures of Huck Finn in 1993, filmed nearby her hometown of Natchez, Miss. “I was a green P.A. that took lunches to Disney executives,” she said with a laugh. “I had to explain what a muffuletta was.”

Sandwiches soon gave way to spreadsheets, as Kelso put her economics degree to use as a film production accountant. That work took her to the set of Ace Ventura 2: When Nature Calls, where she met her husband, Gary, a grip. The two married and moved to Hollywood. “We ended up thinking we would be out in California forever,” she said.

Instead, “a perfect storm,” as Kelso calls in, carried the displaced southerner from the old epicenter of global film production to the new one.

“Ten years ago if you had told me we would be in Louisiana, and we would be named film capital of the world, I wouldn’t have believed you,” said Kelso, who now works as the executive director of the Baton Rouge Film Commission.

Start believing. Earlier this month, a study released by FilmL.A., Los Angeles’ regional film office, revealed Louisiana hosted more major motion productions in 2013 (18) than any other state – or country – in the world, outpacing Canada, Great Britain, New York, and, yes, California.

“Louisiana has always been one of the top production destinations in the world,” said Chris Stelly, executive director of Louisiana Entertainment. “That’s what we’ve always known.”

Now, the rest of the world knows, too, and it didn’t take long to find out, either. Louisiana introduced its Motion Picture Investor Tax Credit Program in 2002 under the administration of Gov. Mike Foster with high hopes, but unsure of a timetable for success.

“There was no doubt we were going to be successful,” said Stelly, a former Foster administration official. “To what level remained to be seen. It was really about focusing on what we needed to do to build up our infrastructure and create a program that’s stable and reliable.”

Stability and reliability meant tweaks. In 2003, credits were made transferrable, meaning producers could sell credits that exceeded their tax liability; in 2005, an infrastructure investment incentive was tacked on, encouraging construction of facilities in state, like the Celtic Media Centre in Baton Rouge. Money and movies subsequently began flocking into the state, but equally as important, many say, was the creativity that stopped fleeing from it.

“When I first got out of grad school with a Masters, the best I could do was get a job making $19,000 as copy writer with an advertising agency,” said Patrick Mulhearn, an LSU alumnus and the executive director at the Celtic Media Centre, which is the largest purpose-built motion picture studio facility in operation in the state. “I was a creative who didn’t want to leave. The state needed to diversify its economy. It’s about attracting and keeping the creative class, and we saw our best leaving to go to Boston and New York or L.A. Something needed to be done.”

And Louisiana did it. The industry boomed. Even in tough financial times, producers flocked to the state to shoot their movies. From 2008 to 2012, actually certified spending from film production increased by $250 million. By 2012, the tax credits supported just over $1.1 billion in sales, $770.6 million in household earnings, and 15,184 jobs for Louisianans, according to a 2013 report by Loren C. Scott and Associates.

The incentive isn’t without its critics, especially among those keeping an eye on the state’s general fund. Though credits don’t cost taxpayers a dime, they do prevent the flow of millions into the state’s coffers, costing the treasury as much as $169.8 million in 2010, according to Legislative Auditor Daryl Purpera.

But the economic benefits appear to outweigh the fiscal costs, if California is to be believed. For Kelso, FilmL.A.’s report highlighted how California’s reeling film industry needs a boost if it is to boost California’s reeling treasury.

“Here we are in Louisiana constantly trying to prove what an impact the film industry is to our own economy, and a report comes out of California saying it for us,” she said. “I found it very ironic. I was blown away.”

So was Mulhearn, who agrees with the economic arguments, and adds an artistic one, to boot.

“We use the football analogy,” he said. “LSU turned its program around by recruiting instate, by keeping the best talent here. That’s what this program is doing. We’re taking the best and brightest from other states, and we’ve been able to keep our creative class.

“I’ve seen so many friends move away from Louisiana never to return. Now they’re coming back. The best return of all is having someone move back. It’s hard to put a real price tag on that.”

That doesn’t mean there isn’t room for improvement. Stelly says the state should select CPAs at the expense of tax credit applicants to assure more accurate reporting, while taking another look at programs that have a minimal direct impact on the state’s economy, such as related party transactions and “soft costs” like travel and bond fees.

“There’s always a better way to administer,” he said.

And on the content side, Mulhearn says scripted television – with its longer runs and less-established-but-more-likely-to-reside-and-spend-money-in-state stars – is Louisiana’s next frontier.

“We’re amazing at hosting production,” he said. “We’ve gotten so good at making other people’s movies. We need to get indigenous and make our own.”

As long as the tax credit system stays in place, that’s likely to happen. More Mulhearns will stay in the state, and more Kelsos will come to it.

“I love California, don’t get me wrong,” said Kelso, “but I was thrilled to bring my family back to the South and let my husband do his craft. It’s been amazing to have the best of the both worlds.”