Vince Gervasi, president and CEO of Triscenic Production Services, saw opportunity in 2021.
The Santa Clarita-based company has been the largest provider of set and scenic storage, transportation and other services to the entertainment business for nearly 40 years. With the industry still in the midst of a streaming surge and the number of productions filmed in Los Angeles increasing dramatically, the company has built seven soundstages.
Three years later, Triscenic, like the industry today, is shrinking. In the past 19 months, only one of those sound stages has been in use. The facility, which once housed 2 million square feet of sets across 41 buildings, has shrunk to half that size. In July, Gervasi laid off 78 of his 85 employees.
“I could get through the strike,” he said, “but the reality is, nothing is happening in the industry. The shows aren’t coming in.”
As Hollywood pushes back, many are asking the same pointed question: Can California do more to revitalize a local industry battered by pandemic closures, actor and technology changes and increased global competition?
The answer is a resounding “yes,” according to Times interviews with dozens of producers, executives, studio executives and film crew members, but the solutions are neither easy nor sure.
Industry insiders and experts agree that, first and foremost, a substantial subsidy for California’s film and TV tax credit program is badly needed to compete with incentives offered in other jurisdictions, but it’s also widely acknowledged that such a boost would be difficult, if not impossible, to obtain.
Others have proposed more modest measures, such as lowering film permit fees in Los Angeles and providing free police services on set.
Underscoring the sense of crisis, Los Angeles Mayor Karen Bass has convened a task force to look at ways to help the industry.
“We’re going to bring in some film experts to give us advice, because this is a crisis and we need all hands on deck,” said Chris Fuentes, a veteran location manager whose work includes “Good Trouble” and “The Big Lebowski.”
Despite disagreements about solutions, there is consensus on the problem: California is simply not competitive with many other states and countries that offer more generous incentives to attract film crews.
Santa Clarita Studios President Mike DeLorenzo said this was the “slowest period” he’d experienced in more than 40 years. Before last year’s strike, DeLorenzo told The Times, 35 of the studio’s 37 sound stages were booked. That number has since dropped to 10.
“I believe the best filmmakers in the world are here in Los Angeles, but they’re outsourced because of tax credits,” DeLorenzo said. “I’m not competing with Universal or Warner Bros. or another big, beautiful facility. I’m competing with Canada, I’m competing with New York, I’m competing with Mexico, and it’s hard.”
These days, studios may even have their own incentive departments that direct location managers and scouts to the territories that offer the best deals.
Lori Balton, a longtime location scout whose work includes films like “Top Gun: Maverick” and “Inception,” said studios have recently been pushing locations in Central Europe, including Hungary.
“A lot of times, when we get a script, they’ll say, ‘Go out and find a place where we can shoot this,'” Balton said. “Now, when we get a script, they say, ‘Here’s the incentive state. Here’s where I want you to look.'”
Former 20th Century Fox chairman Bill Mechanic said he never considered shooting his previous Oscar-nominated film “Hacksaw Ridge” or his upcoming crime thriller “The Dane Conspiracy” in California, instead taking both productions to Australia.
“Should I shoot here? Yes,” he said. “But you go where the money is.”
Production flight
The problem of so-called runaway production galvanized a coalition of unions and labor groups to create the Ugly Betty Act, a modest incentive bill providing $100 million annually for five years. Supported by actor and then-Gov. Arnold Schwarzenegger, the bill was dubbed the “Ugly Betty” bill, after the ABC sitcom that moved its setting from Los Angeles to New York.
Five years later, with the industry in further crisis, the program was increased to $330 million per year and offered tax credits of up to 25% to help producers offset eligible production expenses such as set construction, stunt equipment and crew wages.
Last year, it was given another five years. The law included a new bill for states to pay if their credits exceed their taxes.
Despite the improvements, movie activity has struggled to recover: In the second quarter of 2024, filming days in the Los Angeles area were down 12% compared to the same period last year and 33% compared to the five-year seasonal average, according to FilmLA, the region’s film permitting company.
There are many reasons.
Studios, suffering big losses from streaming and lucrative talent deals, are releasing fewer films and TV shows and are still recovering from the disruption caused by strikes last year.
At the same time, California’s rivals continue to aggressively court Hollywood. The competition is drawing an increasing number of participants from other U.S. states, as well as international locations like Canada, the U.K. (where “Barbie” is filmed) and Australia. A grim reality was underscored this week: Of the 12 shows up for a Primetime Emmy Award, only two have won.
Since 2015, Georgia, which unlike California does not have a cap on its film tax credit program, has spent more than $5 billion to bring shows like Netflix’s “Stranger Things” and a string of Marvel movies to the Peach State.
Last year, the New York State Legislature increased its annual film tax credit allocation from $420 million to $700 million, doubling the state’s movie business.
And New Mexico, home to “Breaking Bad” and “Better Call Saul,” continues to be a big draw for productions: In June, Netflix announced it had built four additional sound stages and other facilities in the state. The streaming giant said it has pumped nearly $900 million into its productions over the past five years.
The California Film Commission recently detailed a number of productions whose incentive programs have helped revive the industry, including giving $12 million to “Suits LA,” the Toronto-filmed spinoff of NBC’s “Suits.” The commission announced that it has allocated nearly $40 million to 18 big-budget and independent films.
“While we can’t always compete with other tax credit programs, they still have great value here in California,” said Colleen Bell, executive director of the California Film Commission.
Still, the amount of filming is still just a drop in the bucket compared to the big-budget, large-scale shoots taking place elsewhere.
Part of the problem stems from the state’s program, which is not only smaller than other areas but also subject to many restrictions.
Joe Cianese, senior vice president of Entertainment Partners, a Burbank-based payroll and production services company, said the Golden State would need to significantly raise the cap on tax incentives to seriously compete with other production hubs.
California’s program is also hampered by its inability to cover the salaries of stars and other top workers, who can eat up a large chunk of a film’s budget.
“The funding and the inclusion are probably the two big game-changers for California,” Chianese said. He added that, like Ireland, California could attract more independent productions by allowing producers to get a large portion of the tax credit up front.
Additionally, California may broaden the scope of its incentives to include more types of productions, including animation, unscripted shows and commercials, said FilmLA president Paul Awdry.
“Competitors from around the world have figured out how to cherry-pick the most expensive and best in class filming, post-production and production support,” Audrey said.
Lindsay Dougherty, chief executive officer of Teamsters Local 399, which represents studio drivers, location crew and casting directors, said the goal is to raise the annual film and TV tax credit cap to $1 billion and expand it to an amount that would allow for over-the-line workers and commercial production, ideally within the next few years.
“Even when we met with politicians last year to expand the lending, we said … ‘This needs to be expanded. This is not enough,'” Dougherty said.
Such a big increase in the program is likely to face fierce opposition from other groups vying for scarce state funds. Critics argue that entertainment subsidies divert money from other important areas, such as education and health care.
“When we look at corporate tax incentives like the film credit, one of the things we think about is, is this effective at creating a more equitable and prosperous California, and could that money be put to better use,” said Kayla Kitson, a senior policy expert at the California Budget and Policy Center. “The evidence is mixed about how well it actually creates jobs.”
But subsidy supporters counter that the credit has worked. “This isn’t just a handout to businesses,” Doherty said. “This is a jobs stimulus.”
Making filming in LA easier
Beyond the state tax credit program, industry leaders in Los Angeles are considering local measures to help filmmakers.
“There’s a lot that can be done around core issues like training and incentives,” said Ellen Goldsmith Vain, CEO of Gotham Group and chair of the task force. “The Mayor has always supported the industry and wants to continue to find ways to incorporate Los Angeles as a key force for filming, make it easier to shoot and stimulate the economy.”
One idea is to allow production companies to double their incentives by offering local tax credits and qualifying for tax incentives from both the city and state, Chianese said.
Base managers also called on the city.
The move is meant to streamline the permitting process, but they say it currently is costly and cumbersome, and they lamented FilmLA’s decision over the past two years to raise fees and reduce the maximum number of filming locations per permit from 10 to five.
“Lower these fees,” said Fuentes, the base manager, “and find ways to reduce the bureaucracy and red tape.”
Audrey said FilmLA’s turnaround time for permit approval is “very quick,” at about three business days. He said lowering permit fees has been difficult because of rising costs of doing business in the city, and the organization has been cutting staff and downsizing its offices to cut expenses.
Frank Schama, president of “Summer of Soul” production company Radical Media, praised the “Made in New York” campaign by the New York City Mayor’s Office to promote the local film and TV industry through subway posters, TV spots and production assistant training programs.
“We stopped taking pride in what we were doing here in Los Angeles,” Sharma said. “How do you bring that back?”
FilmLA says it plans to launch a similar campaign by late fall or winter.
Sharma said Los Angeles should consider offering free police and traffic control services to film crews, as New York does, adding that film crews also pay a “high price” for parking. Los Angeles has done “almost the exact opposite,” he said.
Greg Bilson, whose Sunland-based ISS Props has served the industry for three generations, also would like to see more local film action.
“I never want to hear, ‘This is Hollywood, this is where movies and TV used to be made,’ and that’s what it is now,” Bilson said.
Times staff writer Samantha Masunaga contributed to this report.
