EXCLUSIVE: Today the board of the California Film Commission will vote on draft regulations for how the state’s now-greatly expanded tax incentive program will be administered. With a system based on qualified wages and potential bonus points for economic drivers like VFX, the vote comes just over a year to the day that Hollywood heavyweight attorney Ken Ziffren was officially appointed as Los Angeles’ second Film Czar. He took the job after the death of former AMPAS president and studio exec Tom Sherak. who had died about two weeks before.
In the year that Ziffren has been running point for LA Mayor Eric Garcetti, the Golden State went from handing out $100 million a year via a much-lamented lottery and production fleeing to more lucrative states and territories to a program of $300 million a year for five years based on a job-creation-centric criteria. It now also includes features with budgets over $75 million and network pilots – a massive shift for the town, the state and the industry. In anticipation of today’s vote, Czar Ziffren and his deputy Rajiv Dalal talked with Deadline about the upcoming efforts to persuade the studios to now film in California, the public next steps to bringing back and keeping production at home in Hollywood and a poignant phone call with Gov. Jerry Brown that set the whole thing in motion.
DEADLINE: You saw the tax incentives dramatically rise last year, and a lot more productions are now eligible. But did it sting not to see the final number come in at the $400 million that was first being discussed last summer?
ZIFFREN: We were disappointed at first that the annual number had gone down from the $400 million first proposed, Yes. However, the (fact that the) breadth of the productions that were covered had been expanded to a modern universe and that all forms of TV, Internet and feature are now eligible took a lot of the disappointment of the lower annual number away. So we’re hopeful on production numbers. It’s not going to happen the first year, but in Year 2 and hopefully Year 3, we’re hopeful we’re going to get six, maybe as many as eight big pictures being shot here.
DEADLINE: That’s a big change from the one or two tentpoles that have been shooting here the past few years.
ZIFFREN: Yes, it will be.
DALAL: Here’s the thing. It’s not as though this program is going to be undersubscribed in any way. This program will still be oversubscribed, so we’re not worried that we’re going to have any challenges getting people to film here, but we still need to make sure that the right productions are made here.
DEADLINE: So, getting the studios onboard. Because they’re still looking at all those incentives in Georgia, Louisiana, New York, up in Canada and other places.
ZIFFREN: From the beginning of this process, the studios had to do two things, which might have been contradictory. They had to say, “We’re totally behind this,” and they had to do it in a way that doesn’t alienate the other 49 states. I thought they handled as well as they could.
DALAL: The message that ultimately came from the studio side was, “We’re going to make these movies regardless.” It’s a matter of where and who on the crew is going to be employed or not, and that was just the reality of it. Now, the dynamic within the studios is that they can’t go out there and be like, “Oh, we got to do this because we want to be here instead of New York,” but if you ask the individual studio execs — especially the physical production execs — they want to be here.
DEADLINE: So the motivation is really there now that the money is there?
ZIFFREN: Early on in the process, after I became Film Czar, I got on the phone with them and said, “We want you to do this,” and they say unanimously, “If we had our choice, we’d do it here. If all things are equal, you’ll win.” That got spread out and well known by everyone, and now we’ll see whether that works.
DEADLINE: What, then, are the next steps?
DALAL: It’s going to be a two-phased marketing plan — the first of which is going to be “inside outside,” as Ken always likes to say. We like to refer to it as a roadshow effectively, whereby we’re going to go to the Greenlight Committees at each of the studios and we’re going to go to the packaging agents, we’re going to go to the Independent Finance Agents, and basically say, “Hey, remember us? We’re open for business, and let us explain to you what’s been going on and how this new program works so that you can package your movies and make them here.”
DEADLINE: So an internal industry push? Will the agencies be involved?
DALAL: The second phase will be run largely by Film LA, and it will dovetail with the larger branding campaign that the Mayor’s office and the city of Los Angeles are going to come out with this summer. We’re not privy to what their brand is going to be, whether it’s Made in LA or Brand LA, who knows? That will be the more public campaign end used in location shows around the world and at film festivals, etc. I think that between those two, this will be a fairly strong campaign.
DEADLINE: OK, so mission getting accomplished — but Ken, for you? You took over the LA Film Office for Eric Garcetti a year ago; you saw the legislation that you thought the industry needed get passed. Is your work basically done now?
ZIFFREN: Well, the Mayor’s office is going to see this through until the next round of legislation, which probably is three years off, maybe four, and then beyond that. So we will stay involved on the regulatory side and help studio labor, guilds and other areas to make sure that there are easily understandable regulations that people can function within them. We’ve been extremely pleased at the reactions that we’ve gotten from Amy (Lemisch) and her staff over at the California Film Commission so far, in terms of various policy issues that have already popped up along the way.
DEADLINE: So you’ll continue working for the Mayor as LA’s Film Czar?
ZIFFREN: Yes, at his pleasure.
DEADLINE: What else is on the agenda?
ZIFFREN: The overall push gets into three or four different areas. There is the infrastructure level, and we are working on that with essentially five city departments, which will end up being three city departments in terms of making them more responsive to the needs of the production community. We’re working to make them informed about what the studios would like to do, on the assumption there will be increased activity. So instead of being unable to reach anybody at 5 o’clock because they’ve all left for the day, we’re going to make sure people have cell phones and stuff like that so you can get in contact with them. There’s some administrative stuff that will be working on that will be announced hopefully next month. And there’s that marketing campaign Rajiv talked about that we’re in the process of working on with all the interested parties.
DEADLINE: You guys didn’t go for a mass-marketing campaign to get the legislation passed. It was in many ways very low-key and behind the scenes, as you are known to be, Ken.
ZIFFREN: We were as public as we needed to be, but it just wasn’t a mass-marketing campaign.
DALAL: Sometimes strategic communications are far more important than the public communications, and I think that this was certainly one example.
DEADLINE: Was that the case with the Governor because he wasn’t talking about this at all until the final days before the deal was made.
ZIFFREN: Let me take you back to just before I got this job. The weekend before the announcement, after I had spoken with my colleagues at my firm and then with Rajiv and the Mayor and basically had locked in, I called Jerry and I said, “I’m going to take this unless you tell me not to,” and he said, “No, no, no. That’d be fine.” He says, “I don’t intend to get involved in this until the end. I’m going to let the process go the way it goes, and if that works for you, it’ll work for me,” and I said, “Absolutely.” So I was never concerned about it because he and I have a long relationship, and we trust one another. Then people would come up to me and say, “The barn is going to burn, and he isn’t going to do this,” and I’d say, “Eh, don’t worry about it.”
DALAL: We had to be very mindful that the Governor asked us not to make this a mass media spectacle.
ZIFFREN: He had other things to do. Not saying that ours wasn’t a priority, but there were others. The bond deal had to get done before they could address this. That was just the way it had to be.
DEADLINE: Let’s be honest, since the tax incentives were first brought in back in 2009, there doesn’t seem to have been a lot of appetite in Sacramento to add more money to the pot. This certainly looked like it could have been a losing proposition.
DALAL: I feel that part of the reason why this didn’t get the traction that it did in Sacramento the last several times that there was a question of raising the incentives was that there was never a full, comprehensive understanding that this was about labor and the middle class and small businesses. That really played into the legislators, other than they ones here in LA, all kind of fragmenting on this issue.
DEADLINE: Was there a feeling that this was almost like corporate welfare from Hollywood?
ZIFFREN: Yes. That was the concern.
DALAL: I don’t believe that it was ever communicated previously in a way that made the legislators comfortable that this was actually about small business and labor, and absent that communication, what else were they supposed to think?
DEADLINE: But it got done eventually. Ken, your predecessor Tom Sherak was a very public guy, but you have always been known as a behind-the-scenes guy – more of a mandarin. Was that a concern taking on this gig?
ZIFFREN: I really don’t like to be out in front — and in a weird way, I wasn’t, which is very suitable for me.
DEADLINE: Why was that?
ZIFFREN: The facts changed. The facts changed because when Tom was in office, the legislation hadn’t really started rolling out. Once the legislation rolled out, that became the focal point so the public role wasn’t. It was still somewhat necessary, but it wasn’t a primary interest because what we really needed to do was make this state competitive again. And I think we helped do that.
DEADLINE: It’s a very different industry from when you first started practicing law back in the late 1960s – no tax credits back then.
ZIFFREN: When I started practicing entertainment law, there was no pay television, no home video, no VOD or EST, no made-for-cable programming, and a half-hour TV show had 27 minutes of program content. The modern technology and financing models we have today were unimaginable in those days. Living and working through all of these developments has obviously shaped my perspective of what now needs to get done and how.