Everyone knows subsidies are one of the biggest reasons US Studios choose to do VFX work in certain locations.
What could be the biggest misconception in the VFX industry is to think that it’s the facilities we work for that receive government rebate money. According to some that I talk to in the industry, it’s the studios that receive the money, not the facilities.
This was recently verified when I asked Former ILM General Manager and Digital Domain Founder Scott Ross about them. Here is what he said:
How I understand it is…. the studio says I need the budget to be $9….
The VFX studio bids the work in LA and the cost is $9 so the bid is for $10.
The VFX studio bids the work in BC and the cost is $9 so the bid is $10
But if the work takes place in BC, the studio receives a 25% rebate so now the work costs the studio $7.50, even though the work is bid $10.
The good news for the studio is they get $10 work for $7.50
The good news for the VFX facility is they get the work.
The bad news for the VFX facility is….. they get the work, which after change orders,redos, bad management etc., …. They get the shaft.
What about facilities owned and run exclusively in Canada?
It’s the same deal, the US Studio gets that money. That was revealed many months ago in a twitter discussion VFX artist Joe Harkins had with Adam Stern, owner of Canadian facility Artifex Studios. Here is what Mr. Stern tweeted when Harkins wanted to get rid of the subsidies:
@JoeHarkins honestly? maybe, but not sure. so hard to disagree. not like we get subs, they go to studios.
So think about that for a second.The VFX facilities get none of this rebate money being offered to the studios. The California facilities have to cover the extra costs of opening up a new facility, hiring production overhead, executives, and facility crew. Then they have to purchase all the hardware, software, and furniture. Then they have to pay for lodging, travel, and probably big raises to get key talent to move there.
How much do you think that costs? How about a fucking shitload? We’ve got to be talking millions of dollars. The idea that facilities are moving up there to save money is bogus. They lose money! The US Studios get the big payoff and they didn’t even have to lift a finger.
When you finally realize that you understand why I’m so strongly against this. It’s one thing to be on a path of self destruction, it’s another thing to break out a slip-n-slide drenched in gasoline to see if it will make the ride faster!