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Los Angeles losing the core of its TV production to other states

By Richard Verrier, Los Angeles Times –

LOS ANGELES — The five broadcast television networks will be rolling out 23 new one-hour dramas for the upcoming season. That would normally be good business for Hollywood’s hometown industry — with bookings for soundstages and plenty of work for the costumers, camera operators and caterers needed to put a show on the air.

But not this year. Just two of the 23 new fall and midseason shows will be shot in Los Angeles County, as cost-conscious producers seek tax-friendly production havens in New York, North Carolina, Georgia and other states.

The exodus has been going on for years, especially in feature film production. But television dramas such as “CSI,” “Criminal Minds” and “Desperate Housewives” have long been anchors of Los Angeles’ entertainment economy, helping to offset the decade-long slide in moviemaking. One 22-episode-a-year network series has a budget of $60 million and generates 840 direct and indirect jobs, according to the Los Angeles County Economic Development Corp.

That economic bang is beginning to fizzle. Fewer than 10 percent of new network dramas this season are based in Los Angeles, down from 50 percent in 2010 and nearly 80 percent in 2005.

“The loss of hourlong dramas is very significant,” said Kevin Klowden, director of the California Center at the Milken Institute, noting that a typical drama shoots for eight to nine months, compared with just six to eight weeks for a film. “This is the heart of television production. If this continues, you’re going to see a direct impact on the employment base of Los Angeles.”

Though L.A. still hosts the bulk of new half-hour comedies and reality shows, dramas are more prized because they use bigger crews and have bigger budgets. That translates to more spending in the local economy.

Repercussions from the downturn are being felt across the local film and TV industry, putting the squeeze on prop houses and other businesses that rely on production and creating growing hardship for the grips, location managers and other crew members who are finding it harder to get work in the entertainment capital of the world.

David Henke is one of them. For most of his career, the 52-year-old location manager rarely went more than a month without a job. The Sylmar resident earned more than $100,000 a year working on such TV shows as “Nip/Tuck” and “Deadliest Warrior.”

But Henke hasn’t worked in more than a year, squeaking by on unemployment checks and what’s left of his retirement savings.

“Everything has gone out of town,” he said.

Like many in Hollywood, Henke has family members who are also in the business, and they’re hurting too.

His wife, Carol, who runs a film location business, was forced to close her office after receipts dropped from $300,000 in 2010 to $40,000 last year. And Henke’s brother-in-law, Cliff Rogers, a longtime unit production supervisor and producer, has been jobless for a year.

Although precise figures are not available, some of Hollywood’s below-the-line unions say at least 30 percent of their members are unemployed.

“The impact has been drastic on our members,” said Ed Brown, business agent for Local 44 of the International Alliance of Theatrical Stage Employees, which represents prop makers, set decorators and special-effects workers. “The loss of one-hour dramas has caused a major spike in unemployment because they crew so many people.”

IATSE and other entertainment unions have been lobbying lawmakers in Sacramento to extend California’s film tax credit program, which is set to expire next year. But the program has struggled to compete with more generous incentives in other states. New York offers four times as much in tax credits as California and recently tripled the credit for post-production work.

New York had a record year for TV production last year and is on track to repeat in 2012. More than half a dozen new fall and midseason network dramas are expected to shoot in New York this season, including the CW’s “The Carrie Diaries,” CBS’ “Elementary” and ABC’s “666 Park Avenue.”

At least seven new broadcast dramas will be shooting in Canada, including ABC’s “Zero Hour,” in Montreal, and “Hannibal” and “Beauty and the Beast,” both in Toronto, which also hosts the new drama “The L.A. Complex,” about a group of actors trying to make it in Hollywood. Other new dramas are being filmed in North Carolina, Georgia, Hawaii, Pennsylvania, Massachusetts and Tennessee.

To be sure, creative reasons also factor in the decision-making. It made sense to shoot “Dallas” in Texas because the story is based there. But tax credits offered by Texas were also important, said Michael Robin, an executive producer on the series, who is also a producer on the new cable crime drama “Longmire,” which is set in Wyoming but filmed in New Mexico, partly to take advantage of tax credits.

“The cost of producing these shows goes up every year, but the bottom line doesn’t,” said Robin, who is also producing the new cable drama “Major Crimes” locally. “The tax credits help close the gap.”

“The reality is, as long as Sacramento continues to balk at having real incentives, we’re going to continue to lose the most lucrative forms of television and film production,” said Paul Audley, president of FilmL.A. Inc., the nonprofit group that handles permits for the city and county. “We’re losing tens of thousands of jobs to New York.”

Even before the latest TV downturn, the local jobs climate was bleak, partly because of studio cutbacks caused by the recession but also because of the long-term effects of production flight. A report by the Milken Institute estimated that California lost more than 36,000 film industry jobs and $2.4 billion in wages between 1997 and 2008, which it attributed mainly to the effects of so-called runaway production.

Some local craftspeople are making contingency plans.

Elion Olson, an assistant director on “The Defenders” and “Criminal Minds,” has worked sporadically since Christmas. When he and his wife ran out of money to buy groceries, they moved to Alabama temporarily to live with her parents.

The 41-year-old North Hollywood resident recently returned to L.A. to work part time on an ABC show. But he isn’t banking on a long-term career in the business.

He recently began taking courses to become a scuba diving instructor.

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