The group highlighted sharp losses of revenue and increasingly cautious strategies for area studios — changes that have resulted in job cuts and economic contraction.
Those challenges should be a cause for alarm in the region, with at least 40 other states offering tax incentives that could eventually pull the industry elsewhere unless the region pays closer attention to keeping it in Hollywood, the report said.
“We have to be very, very cautious because the industry is focusing on the cost of production, so if somebody has an incentive that works to their advantage, they will take advantage of it,” Kyser said.
He predicted industry job growth in 2010, mostly because of a new California tax incentive for local productions and NBC’s decision to move “The Jay Leno Show” out of prime time and create more opportunities for more expensive scripted dramas.
But major motion picture and television studios are so willing to trim expenses that they will likely not think twice about relocating elsewhere if it makes financial sense, similar to defense contractor Lockheed, which abandoned its headquarters in Burbank, he said.
“We just can’t take anything for granted in the very competitive environment that we’re in,” Kyser said.
While a complete shift of the industry’s center of gravity is unlikely, the prospect of California’s new tax incentive making a serious difference in the way that studios make their location decisions is also a long shot, said Ariel Levy, head of production at the Los Angeles Film School who worked as head of production for “Home Alone.”
