We Are Thriving – How the Movie Industry Affects Our Local Economy
If Culver City is the Heart of Screenland, then there’s no doubt that screenland is the heart of the Culver City economy.
From restaurants and hardware stores to florists and even the city itself, Culver City’s myriad collection of production companies and industry giant Sony Pictures Entertainment have kept the city economy thriving, even in a down market.
“Film and television production really are the lifeblood of Culver City,” said Mayor Jeff Cooper. “We all know someone who works in the industry, but more important than that, all the people who work in the industry shop and eat in Culver City.”
In fact, the film industry is the lifeblood of California, itself. According to the Los Angeles Economic Development Corporation (LAEDC), almost 39 percent of national employment in motion picture and video industries occurs in California, and 60 percent of all labor income in the industry is earned in California. The proportion of freelance workers (independent artists, writers and performers) in California and their income is similar, with almost 62 percent of all national labor income in this sector earned in California.
California’s rich history in film making has allowed the development of a deep pool of talented workers in the variety of occupations needed to produce a motion picture or television series. This makes it possible for the industry to find suppliers for almost all its needs within the state, keeping this economic activity here. Almost 92 percent of all the goods and services purchased by the industry are sourced within the state.
The industry purchased $6.4 billion in goods and services from other firms within its own industry; it purchased $1.7 billion in advertising services and paid $1.5 billion in rent or real estate services. In aggregate, the industry spent $15.4 billion on goods and services in California last year from a wide variety of industries.
Culver City is no exception.
“More than 25 percent of our business comes from the studios,” said Mike Eskridge of Culver City Flowers. “The film industry is in all the time to buy flowers for film shoots as well as buy the everyday flower orders that get sent to or from the studio. It impacts is a lot.”
Eskridge said his shop used to provide all the flowers for the television show “Dallas,” especially after its fans demanded more realism.
“First, we did artificial flowers, but the audience complained when they saw the same thing over and over,” he said. “So, then, they switched to fresh flowers. That kept us busy. If I could get another Dallas, that would be great.”
Located in the middle of a triangle that includes Los Angeles International Airport, the Sony Pictures lot and Playa Vista, where former aircraft hangars are regularly used as sound stages, the Doubletree by Hilton – Los Angeles Westside, does a robust business with the industry.
Melissa Williams, director of sales, handles all the hotel’s entertainment business and said production companies often book large blocks of rooms for lengthy periods to accommodate film and television productions.
“It’s definitely the leader in the group business that we do,” she said. “It’s extremely significant because the groups we acquire come in in large numbers and stay for long periods – sometimes for months at a time.”
She said that while those room nights often translate into increased business for the hotel’s restaurant and catering business, those long stays mean hotel guests want to go out and explore.
“It’s a real positive impact for the city,” Williams said. “They go out into the community. They go to the mall. They go to downtown Culver City. And we do our best to direct them to places within the city because we know how important that is to the local economy.”
The numbers are staggering.
For example, according to 20th Century Fox, the television show Modern Family, which recently spent a week filming in Culver City’s Veterans Park, supports 200 jobs in the Los Angeles area and pumps $20 million into the local economy every year. A single $70 million movie sustains 928 jobs and generates $10.6 million in state and local tax revenue, according to the LAEDC.
Amazingly, for each Starbucks Coffee location in California, there are three companies here that are involved in the film business.
Still, Culver City and California as a whole struggle with runaway production.
California once accounted for more than half of all motion picture production in the United States, but production has shifted elsewhere in recent years, particularly in response to tax incentive programs. Competition comes not only from other states, but increasingly from other nations. The development of excellent production and post-production facilities in Canada, Australia, New Zealand, the United Kingdom and Germany is enabling a shift of work that was once done almost exclusively in California. All of these nations have attractive incentive programs.
While relocation of production to London or Auckland may be more costly than filming in Albuquerque, tax credits combined with favorable exchange rates can make the move cost-effective, in particular for large budget productions that involve the construction of complex sets and filming for 12 months or longer.
John Zabrucky, who founded Culver City-based Modern Props 32 years ago, said he is fighting runaway production not just because he is trying to save his business — he is also trying to save the film and television industry. Modern Props’ 120,000-square-foot facility includes more than 70,000 props, including furniture, lighting and electronic equipment used in film and television productions.
At a recent State Assembly hearing about runaway production, Modern Props Vice President Ken Sharp told lawmakers that, “the [film & television] industry is one of the last great industries we have left. If we let it go, what will we have left?” Sharp is increasingly frustrated at the “economic warfare” other states are waging against California. “With tax incentives,” Sharp said, “these other states are trying buy our industry.”
For Adam Goldberg, the creator of the Fox network’s television comedy “Breaking In,” which lasted only a year even the tax incentives weren’t enough to take him away form Culver City.
“When we were deciding where to shoot, there was a version where we were going to shoot in Chicago,” Goldberg told Annenberg News. “We would have saved a little bit of money shooting there, but ultimately Sony was willing to produce on the Sony lot.”
Creatively, working in L.A. was an advantage for Goldberg.
“For a comedy, I just thought the best thing was to keep it in L.A. so that we could be around the actors and have them a two-minute walk away,” said the producer.
“Breaking In” was set against the backdrop of Culver City, where the Sony lot is situated. The show revolved around a new heist in every episode, and by setting it in Culver City, the producers could feature the town prominently, rather than making the location vague, as is done in many other television shows.
“Anyone who lives in L.A. wants to shoot in L.A.,” said Goldberg. “It’s just a matter of whether they can afford to or not.”
As for the City of Culver City, it is trying hard to make filming not only cost-effective, but also easy.
“We really are trying to be progressive in helping companies film here in the city,” said Dan Hernandez, director of the city’s Parks, Recreation and Community Services Department. “I’ve gone out to meet with production companies to see what we can do to make it easier. A lot of other communities make them jump through hoops, but we’re trying to make it easy.”
Hernandez said he and his staff routinely meet with production companies, both on the film and television side, to see how best to serve them and keep them coming back. In addition to Modern Family, the television show Rake recently filmed at Veterans Auditorium and numerous films, including Pirates of the Caribbean, have used the Culver City Plunge as a filming location. And while those productions are local, Hernandez said more and more production companies from out of town are seeking out Culver City.
“It’s private shoots, independent films, commercials – not just Sony,” he said. “I think they come because we’re such a full-service agency and we have great locations. We have City Hall, city businesses, the pool, the auditorium, parks, even residential streets. We’re also very production-friendly – probably the most friendly city in all of L.A. County.”
Hernandez said that reputation is no accident.
“We constantly follow up with them,” he said. “We take the time to call them back and help them out whether they’re filming in our parks, at our pool or at City Hall. We try to leave a good taste in people’s mouths when they do business in Culver City.”
And Williams said that is exactly what is happening.
“We hear the production companies gripe sometimes that there’s a lot of red tape and bureaucracy in other places where they film, but Culver City does a good job with filming permits and such,” she said. “Of course, making the process easy for them is a good idea because making it easy entices them to film in the area, stay in the area and shop in the area. That’s good for everyone.”