The proof is in the numbers. According to Governor Nathan Deal, the film industry boasted a more than $7 billion economic impact on the state of Georgia during the last fiscal year. In fiscal 2016, 245 feature film and film productions created 2+ billion in direct spending. And many predict 2017 will be even bigger.
In my last blog, Top Takeaways from GSU’s Views From the Top, I shared entertainment industry insight from John Brooks Klingenbeck, Managing Partner of Artist Entertainment Management at Red Hill Entertainment. This month, I take a closer look at this booming industry. An industry that Atlanta Mayor Kasim Reed expects only to grow in 2017.
So, why Georgia? The state has intentionally created an attractive breeding ground for the entertainment industry to grow. Creating tax incentives and promoting an industry workforce via education are just two of the many ways Georgia has succeeded in this industry’s rapid development.
The $7 billion economic impact in fiscal 2016 represents a 2,000 percent increase since 2008. Yes, you read that right. The Atlanta Business Chronicle recently reported, “Georgia is the No. 3 location in the United States for movie and TV production, and [Mayor Kasim] Reed said it will beat out New York for the No. 2 spot before the year is out.” Georgia beating out New York; who would have thought?
But this growth did not happen by chance.
One of the main reasons Georgia landed popular TV series like “The Walking Dead” and “Stranger Things” and feature films like “The Blind Side” and “The Hunger Games” series is the 2008 passage of the Georgia film tax credit.
Wondering how the tax credit works?
According to Georgia.org’s web page Film, Television and Digital Entertainment Tax Credit, “Georgia’s Entertainment Industry Investment Act provides a 20 percent tax credit for companies that spend $500,000 or more on production and post-production in Georgia, either in a single production or on multiple projects. The state grants an additional 10 percent tax credit if the finished project includes a promotional logo provided by the state. If a company has little or no Georgia tax liability, it can transfer or sell its tax credits.”
Basically, tax credits of up to 30 percent deliver significant savings to companies for the production of feature films, television series, commercials and music videos as well as corporate video, game development and animation. And guess what? They are working!
With a growing entertainment industry, the need for a supporting skilled workforce skyrockets. Georgia is working to meet the need. Gov. Nathan Deal initiated the Georgia Film Academy (GFA) to offer professional training in the craft of filmmaking. The GFA predicts the entertainment industry will create 3,000 – 5,000 new jobs, with average job earnings of $84,000, over the next 3 – 5 years. A collaboration of the University System of Georgia and the Technical College System of Georgia, GFA currently partners with 11 educational institutions statewide. According to an Atlanta Business Chronicle article, “610 students [were] expected to have completed Course One at eight university and technical college campuses, and 274 will complete on-set production internships leading to workforce certification” by the end of 2016.
Obviously, the state of Georgia is working very hard to provide the necessary workforce to maintain its fast-paced growth in the entertainment sector.
Other GA Perks
With incredible tax credit offerings and a growing skilled workforce, Georgia’s projected industry growth is bound to happen. Here are additional reasons the entertainment industry is choosing the Peach State to conduct business:
- Infrastructure of studios and vendors, with 14 or 15 major studios statewide
- Location, location, location. Georgia has it all: urban, rural, coastal, mountains
- Hartsfield-Jackson Atlanta International Airport: offers multiple, daily nonstop flights to LA
- Quality of existing productions: feature films “Hidden Figures” and “Sully” earned Oscar buzz and TV series “Atlanta” is award-winning
Entertainment Industry + CRE
The entertainment industry’s growth can only have a positive effect on commercial real estate development and investment. At PREF, we understand firsthand the impact of the Georgia film tax credit as one of our services is to buy and sell tax credits as a wealth management tool used to reduce income tax liability for individuals and businesses.
Georgia’s entertainment industry is on fire, and it will only continue to heat up.
How has your business been impacted by Georgia’s growing entertainment industry?