News
Screen International, November 2006
Producers will be singing "Oh, What a Beautiful Morning” if they wake up with a production in Oklahoma.
The western US state has recently given permission to one company - Indion Films - to include film in an existing tax credit programme which encourages investment in rural sections of the state and which insists on a diversification of investment.
"The credits are designed so someone will set up four Starbucks or four diners or four factories -- there's a specification that you can't put all your investment in one place," said Ted Kroeber, who with partner Chad Burris established Indion Films LLC as a conduit between producers and purchasers of tax credits . "For our purposes, we couldn't bring in a $20 million movie tomorrow and be in good graces with the state; we have to bring in four $5 million movies." So the independent arena is where Indion is directing its energies.
Through Indion, investors can access an upfront 30% tax credit against Oklahoma taxes, and if you are not an Oklahoma tax payer, Indion will bring one in who will invest funds in trade for your credit.
The scheme is not to be confused with a state rebate fund which provides 15% cash rebate at the end of production and can be accessed by any film-maker regardless of where they are based.
Burris said that once news spreads about the Indion programme -- which sweetens various aspects of similar incentives in New Mexico, Illinois, Louisiana and New York -- the state will sell itself.
"First, the cost of doing business in Oklahoma is just so much cheaper that it is in a lot of other places," Burris said from his Tulsa office. "Your hotels, gas, food, to a certain extent labor; everything is going to be cheaper in Oklahoma. Also, Oklahoma is a crossroads for a lot of different topography -- it all comes to a point here. In the eastern half we have hills, mountains and lakes; we have deserts and plains areas. We have a lot of really good rural settings, locations for period pieces, and urban settings as well. You couldn't fake New York City but, other than that, Oklahoma covers just about anything you want to shoot."
Burris added that the film doesn’t need to shoot in rural areas, just that the film film company has to be based in one of those rural areas.
Indion is "the only shop in town" at the moment to qualify for the credits and parlay them into cash, Kroeber said -- "until somebody else sets their company up the same way. The hurdles for us right now aren't competitors. It's getting people to see Oklahoma as a viable place to make film."
He said the types of films they're looking to lure in are the "Little Miss Sunshines" and "Thank You For Smokings" and other mini-major productions.
"If you're [producer] Albert Berger and 'Little Miss Sunshine' is going to be an $8-million movie, and you've got $6 million, an Oklahoma investor can come in, invest that money and take the whole 30 percent credit for the entire production,” he said. “So they get the big fat tax credit and are out of the process because they've gotten their return and you're holding the equity of the film to divvy up amongst your investors. You're getting 30 percent up front if you're an Oklahoma credit taxpayer; if you're not, we can broker the credits for a producer and they'll get 18 percent back, on their money; they're selling about 60 cents on the dollar now."
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