VES Open Letter – Call to Action

First, we call upon Governor Brown and the State Legislature to immediately expand its tax incentive program for the entertainment industry and to include a focused approach concentrated on the visual effects and post production sectors of the industry.

Secondly, because we have reached a tipping point for the visual effects industry and there is much pent up energy, anger and frustration right now, the VES, under its good offices, is organizing a VFX Congress to take place within the next few weeks to allow all artists from around the world to share their concerns to find common ground on the issues that face us today. It is hoped that this effort will lead to a number of direct follow up actions that will gain consensus from visual effects artists everywhere.   Everyone is invited and should attend.

As has become all too apparent over the past few years, and especially in the past few weeks regarding the status of Rhythm & Hues, Digital Domain, DreamWorks, and other visual effects facilities, the future for professionals who work in the visual effects industry – and the entertainment industry at large  – in California is in serious jeopardy.

We certainly recognize that we live in a global economy and in fact, VES has members in 30 countries around the world. Many of those countries – and many states elsewhere in the US – offer aggressive tax incentives – which seek to lure visual effects work to their communities and away from our state. While California finally created a tax incentive program in 2009 (AB1069, Chapter 731, which was recently extended it to 2017), it is woefully inadequate to the needs of today’s entertainment industry. In effect, thousands of talented visual effects artists are joining the unemployment lines or becoming “migrant film workers”, chasing the work outside our borders because that’s where the jobs have been going and are still going.

The amazing irony is that while 47 of the top 50 films of all time are visual effects driven and billions of dollars of profits are generated yearly, the actual people who create the work are becoming an endangered species in California. In short, Hollywood, the birthplace of all this art and commerce, is quickly becoming the land where creative dreams die on the vine and pink slips for dispossessed artists are being issued at an alarming rate.

We know that there are some out there who are calling for the elimination of all subsidies & tax incentives everywhere around the world. We think that’s a great idea and if there were a magic button that could be pressed to make that a reality, we would press it in a nanosecond. Why? Because California can compete with anyone, anywhere if there’s a level playing field.

But in today’s global economy, where many hundreds of localities around the world are feverishly devising new ways to make California’s piece of the entertainment pie smaller, the fact that California’s program doesn’t meet it’s current needs (it only allocates $100 million yearly … which meets the needs of only about 20% of the work that would stay in California otherwise. For comparison purposes, New York caps its program at $420 million yearly and both Louisiana and Georgia are uncapped in the amount of incentives they offer), and is recklessly negligent to the thousands of visual effects professionals who are daily losing their jobs to other locales around the world. This not only hurts those artists, but also California’s economy because thousands of good paying jobs wind up buttressing the economies of states and countries elsewhere and the technological advances that otherwise would be birthed in California are now taking root elsewhere.

According to a Milken Institute report from July 2010, commenting on the changing entertainment industry economy in California since 2008, their “research shows that if California had managed to retain the 40 percent share of North American employment it once enjoyed, 10,600 direct jobs would have been preserved here in 2008. Furthermore, those direct jobs would have had broader economic impact, generating an additional 25,500 jobs after rippling through other sectors. If the state had maintained its former level of dominance, a total of 36,000 jobs would have been saved, generating $2.4 billion in wages and $4.2 billion in output.”

But until such time as all tax incentives everywhere are a thing of the past, California will need to take action– right now – or we’ll lose many thousands more jobs and Hollywood will soon be the equivalent of an empty storefront.  

If you support this call to action for a larger incentive program in California that matches the needs of filmmakers and would keep jobs here, then send letters to our state lawmakers that urges them to get to work immediately to increase our incentive program. See the sample letter below.

Additionally, for the benefit of our membership and visual effects professionals worldwide, we will work with our global VES Sections and others to promote a healthy and vibrant visual effects industry in every country where visual effects are created.  It is for all of our worldwide colleagues – here in California and everywhere else – that we hope a VFX Congress can bring us all together in a truly meaningful way. Details of when and where the Congress will take place will be forthcoming. Together we can make amazing things happen.

As always, feel free to send us your comments at leadership@visualeffectssociety.com.

Respectfully,

Eric Roth

Executive Director

Visual Effects Society

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SAMPLE LETTER TO GOVERNOR BROWN AND THE CA STATE LEGISLATURE

Snail Mail is Strongly Recommended – It Gets Noticed Much More

(All have the same address at the State Capitol in Sacramento)

Governor Jerry Brown

Assembly Speaker John Pérez

Senate President Pro-Tem Darrell Steinberg

Senator Ron Calderon, Chair

Select Committee on California's Film and Television Industries

Assembly Member Ian C. Calderon, Chair

Committee on Arts, Entertainment, Sports, Tourism and Internet Media

To Find Your Own Assembly member and State Senator, go to: http://www.legislature.ca.gov/legislators_and_districts/legislators/your_legislator.html

State Capitol

Sacramento, CA  95814

Dear:

As has become all too apparent over the past few years, and especially in the past few months with the bankruptcy and dislocations of  highly respected visual effects houses, the future for professionals who work in the visual effects industry – and the entertainment industry at large in California – is in serious jeopardy.   This is particularly ironic in light of the great success of Ang Lee’s Life of Pi, this year’s Oscar winner for visual effects whose work was primarily created at Rhythm & Hues, a visual effects company that just declared bankruptcy.

With the above in mind, I am calling upon you to immediately expand the tax incentive program for the entertainment industry, and to create a more focused approach concentrated on the visual effects and post-production sectors of the industry.

Because we live in a global economy, many foreign countries and other US states are trying to lure visual effects work to their communities by offering incentives in a much more aggressive way than California does. While California created a tax incentive program in 2009 (AB1069, Chapter 731, which was recently extended it to 2017), we need to do much more to meet the needs of today’s entertainment industry here in California.

Thousands of amazing visual effects artists are becoming “migrant film workers” who either join the unemployment lines or get on airplanes to chase work outside our borders because that’s where the jobs are going.  The most amazing irony is that while 47 of the top 50 films of all time are visual effects driven ( http://www.imdb.com/boxoffice/alltimegross ), and billions of dollars of profits are generated yearly, the real people who actually create the work are becoming an endangered species in California.

If all the tax incentives everywhere around the nation and the world were eliminated tomorrow, California could compete with – and beat - anyone, anywhere if there’s a level playing field. California’s economy is not reaching its full potential because thousands of good paying jobs are leaving our state which winds up buttressing the economies of states and countries elsewhere.

California leaders need to take action – right now – or we’ll lose many thousands more jobs, and Hollywood will soon be the equivalent of an empty storefront, all green screens and no magic left to film in front of it.   I therefore urge you to expand California’s entertainment incentive program to keep our work here in our home state.   Thank you for your time and kind consideration.

Respectfully,

Your Name