Facilities fuel New Mexico production boom

Facilities fuel New Mexico production boom



The Hollywood Reporter.com


September 18, 2007


by Wolf Schneider



When Paul Haggis began searching for locations to shoot his intense Army drama "In the Valley of Elah," he knew he wanted a place in the South with a 1960s-style motel adjacent to a diner and an Army base nearby -- and, of course, in a state with generous tax incentives. Although he had booked scouting trips to New Mexico, Louisiana and South Carolina, he landed first in Albuquerque and quickly discovered he'd found the perfect spot to begin production.

"Within an hour and a half, I'd locked in four locations! Not found them -- I mean, locked them," Haggis says. "I said, 'It's great. It's perfect. Move on!' So that was just remarkable. I really found a terrific variety of architecture where I thought I'd just find unending adobe."

The Oscar-winning writer-director-producer isn't the only filmmaker who's been lured to the Land of Enchantment recently. Since Gov. Bill Richardson, now a presidential candidate, pushed through an aggressive package of tax rebates and no-interest loans in 2002, New Mexico has become one of the top five filmmaking destinations in the U.S. More than 80 feature film and television projects have been made in the state since then, and annual direct expenditures from film and television production have skyrocketed from $3 million in 2002 to $159 million in 2007. This year alone, the state has attracted more than 30 feature films and television projects.

And it looks as though Hollywood is here to stay. Infrastructure is now solidifying in this artists' mecca of high chaparral and low population density, striated by the southernmost Rocky Mountains. The crew base has deepened to almost 1,500 -- or four to five crews -- with homegrown training programs at schools like the University of New Mexico cranking out a new generation. Sustainability is the strategy now, with three seminal events coalescing in the last year.

First, Albuquerque Studios, a $74 million 28-acre site, opened its first six soundstages in April and is already fully booked up.

Second, Sony Pictures Imageworks broke ground on a 100,000-square-foot satellite facility at Albuquerque Studios. It'll open in June 2008 with 100 jobs in animation, visual effects and digital media, eventually growing to 300.

Third, the "sunset" clause on the 25% tax rebate was removed, so that rebate is now permanently in place. What's more, the loan fund has been increased so it now holds about $280 million that can be outstanding at anytime -- and the state is about to receive its first profits on the loan program from Lionsgate, which advanced $500,000 against the profits of 2006's "Employee of the Month" and ABC Family's "Wildfire," according to state investment council topper Greg Kulka.

Entertainment attorney Peter Dekom helped structure the up-to-$15 million loans that protect the state's principal since the qualifications include a solid guarantor, distribution in place and the hiring of New Mexico residents for 60% of the below-the-line crew payroll. Mind you, Dekom doesn't actually read any of the 50 to 100 scripts a year he puts into serious evaluation; his forte is assessing deal elements -- which is why the political comedy "Swing Vote" obtained a loan with just foreign distribution in place, plus a personal guarantee from star Kevin Costner, who's also producing it with Jim Wilson. In midproduction now, the picture just got a domestic deal with Disney.

"Kevin's an amazing guy," comments Dekom. "Kevin is in it so deeply. It's his money that guaranteed the letter of credit that guarantees us. And I think he's going to make a lot of money on it."

In return, Costner says, "I have several films that feel like they could work here. I feel like there is a great crew base here."

"Swing Vote" writer-director Joshua Michael Stern explains of his film: "It's about the presidential election coming down to one vote, and it had to come from a swing state -- a state that was sort of independent, that was a free-spirited, free-thinking kind of place. So I set the script in New Mexico." Stern imagined his setting to be "a little desert town like in (1971's) 'The Last Picture Show.'"

Producer Wilson found that sleepy town in Belen -- complete with an area they could use as a backlot. Wilson found everything else in the script here, too. "It was like, I need some stately buildings for the capitol -- that's in Santa Fe," he recounts. "I need large warehouses. I need chicken factories. I need something that looks like Vermont for Dennis Hopper's character's palatial house -- we found a big A-frame home in the Sandia Mountains. I need Santa Barbara for where Kelsey Grammer, (who plays) the incumbent president, can live -- that's in Corrales."

Wilson knew New Mexico, having teamed with Costner on 1994's "Wyatt Earp." "The industry has come a long way here in the last 10 years. There's an infrastructure now that's capable of handling numerous movies," he observes.

Albuquerque, with a population of half a million, is New Mexico's biggest production center -- though Santa Fe and other points north attract the atmospheric Westerns, like New Line Cinema's "Appaloosa," directed by and starring Ed Harris. "That area seemed right for what we were looking for. It was the dramatic quality of the landscape, I guess you'd say -- the water, the cliffs, the sky, the clouds," says Harris, who also considered -- then nixed -- Canada, Texas and Arizona, because "the great rebate situation is difficult to pass up."

The master strategist behind those 25% tax rebates (which are true tax rebates on New Mexico spends, not tax credits as so many other states offer), and indeed the whole production boom, is Eric Witt, Gov. Richardson's director of media arts and entertainment development. Since Richardson took office in 2003, film production has brought the state $409 million in direct expenditures. "The key now is our reputation and the relationships we develop, and because of that, companies like Sony Imageworks are relocating on a permanent basis here as opposed to sending individual productions," evaluates the savvy Witt, who was vp finance at Dino De Laurentiis Communications before donning his cowboy boots.

"Yes, we are a case study in a general economic development sense," allows Witt. "But the film business doesn't always make sense for every state." Hosting film and television productions requires more than just varied locations and, in the case of New Mexico, 300 days a year of sunshine, Witt elaborates: "You have to design your program in way that makes economic sense for your state, and that largely depends on your tax structure and your job base. Do you have crew? The reason we are able to give a 25% tax rebate and still make money -- we are one of, if not the only state that makes money on its rebate program -- is because of our gross receipts tax and personal income tax and corporate income tax."

"States that don't have that tax structure -- like Nevada or Texas -- can't just take New Mexico's model and co-op it lock, stock and barrel," he continues.

With 15 projects either here or coming, New Mexico is now the busiest ever. Two futuristic films both in the $50 million range are headquartering at Albuquerque Studios: Lakeshore Entertainment's "Game," in which a fictional prison institutes a process whereby convicts can commute their sentences by participating in a deadly game, and Lionsgate's "The Spirit." Other projects include Paramount Pictures' latest installment of the "Indiana Jones" franchise, USA Network's drama series "In Plain Sight" and AMC's crime series "Breaking Bad." "The Burrowers," a sci-fi thriller about underground creatures who prey on the inhabitants of a 19th century Western town, just wrapped, as did the Cuba Gooding Jr. action thriller "Linewatch," which was promptly picked up by Sony Pictures Entertainment, and there's talk about a Taylor Hackford movie coming.

State film commissioner Lisa Strout observes, "To have the infrastructure with a major company like Sony here on the ground has already spurred other people to want to be here too in a sort of media cluster."

"We're scouting a lot these days for Iraq and Afghanistan and Pakistan on the western face of the Sandia Mountains and the Florida Mountains near Deming," Strout adds.

Anticipating more activity, producer Lance Hool is in advanced talks to open a soundstage complex in Santa Fe County called Santa Fe Studios, and Lionsgate has a soundstage in the planning for north of Albuquerque. Says Lionsgate executive vp Mark Manuel, "We are looking at numerous options for our film studio. If anything, we have seen the volume of production in New Mexico pick up dramatically over the past few months."

It's enough to make Dekom punningly promise, "You'll never get a chile reception in Tamalewood!" And to drive it home with "We can keep our crews busy all the time -- we are a hot tamale."

IN PRODUCTION: Projects currently shooting in New Mexico

"Breaking Bad" (AMC) "Malcolm in the Middle's" Bryan Cranston stars as a high school teacher who suffers a midlife crisis and becomes a criminal.

"Five Dollars a Day" (ThinkFilm) Christopher Walken toplines as a con man on a road trip with his conservative son, played by Alessandro Nivola.

"In Plain Sight" (USA Network) Mary McCormack stars as a federal marshal who works with people in the witness protection program.

"To Live and Die" (MGM) Joe Pantoliano plays an assassin on the run in Albuquerque.

"Swing Vote" (Disney) Political comedy stars Kevin Costner.

"The War Boys" Drama based on the acclaimed play by Naomi Wallace about vigilantes who police the Mexican border.

COMING UP

"Appaloosa" (New Line Cinema) Ed Harris, who co-adapted the Western drama, will produce and direct, as well as co-star with Viggo Mortensen and Renee Zellweger.

"The Burning Plain" Charlize Theron stars in this drama, which marks the directorial debut of Guillermo Arriaga, screenwriter of 2006's "Babel."

"Game" This high-concept thriller stars Gerald Butler.

"Hamlet II" A high school teacher attempts to write a sequel to Shakespeare's "Hamlet" in this comedy starring Catherine Keener and Steve Coogan.

"The Spirit" (Lionsgate) Graphic novelist Frank Miller's first solo directorial effort stars Gabriel Macht as a cop who returns from the dead to fight crime. Also stars Samuel L. Jackson, Scarlett Johansson and Eva Mendes.





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