Recently elected Republican Governor of New Mexico Susan Martinez has this as one of her proposals for cutting the budget:
New Mexico may be running away from runaway production.
One of California’s biggest rivals for film production has proposed a heavy cut in its tax rebate program, which offers filmmakers a 25% rebate on their production costs.
New Gov. Susana Martinez, a Republican who has vowed to curtail government spending, on Monday called for reducing the credit to 15% under a plan to balance the state’s budget.
I write a bit about the real reason vfx jobs for US films leave: government subsidies offered to producers to do the work in other states and countries.
I once asked about the problems these subsidies had for a big facility owner and he cut to the chase:
Look, these subsidies will not last. They can’t hand out free money forever.
Will the new governor be able to lower the subsidy? I don’t know but back when I called the UK Film Council’s report on subsidies bogus (which was closed a month later), I pointed my target at New Mexico and indeed what is happening now is what I predicted:
While the race for governor in the state heats up as the Republican candidate would order a review of New Mexico’s 25% film subsidy. Didn’t I say that Hollywood is a favorite target for conservatives?
In 2007, things were very bleak for the vfx market in Southern California. Imageworks opening facilities in New Mexico. Imageworks and ImageMovers in Novato. Laika in Oregon. VFX projects being lost to the UK. Later, some Imageworkers were being offered 6 month contracts in New Mexico or the prospect of being laid off. Most just ended up going to other facilities in So Cal.
For many who were eager to settle down, buy a home, and start a family, they jumped at the chance to move. One producer I chatted with shook his head and rolled his eyes:
What were they thinking? There are no other vfx companies out there.
Indeed, with so few facilities to bargain with it wasn’t a very good idea. One blog at the time even wrote:
If Sony opens a studio in NM, will many people really pack up their lives and move to a one pony town? I realize the cost of living is lower there (and you can be assured your income will drop too), but is it worth the gamble? If Sony goes through with it, I guess we will find out.
Now almost 4 years later what do we have now? For So Cal there has been quite a bit of work flowing in. However, ImageMovers and Imageworks Novato facility closed. Laika downsized very quickly. Imageworks’ New Mexico facility was supposed to be huge but was scaled back to a few office spaces. The new executive regime of Oshwitz at Imageworks is now focused on Vancouver’s super large subsidy. We’ll see how long that lasts but in the end the work will ultimately go where the talent resides.
As the years passed, I heard of nightmare scenarios where vfx artists signed mortgages and came into work the day it was announced ImageMovers was closing. I point out that buying a home is a bad idea for VFX artists even if it’s affordable because the industry is so unstable and we move around so often.
I was saddened to hear a story by a friend who worked at Imageworks at the time. One executive basically told the group that eventually all of Imageworks would move to New Mexico with just a small crew in Culver City. At one point the executive told the group that they already purchased a home in Albuquerque. Of course it turns out that the executive was lying.
I always found it funny that in every other part of life lying is bad. In business it’s just a part of good strategy.