Nov. 12--California's struggling film and television industries will take center stage in Los Angeles today, as lawmakers and Hollywood leaders gather to discuss the future of the state's production.
The one-day event, focused largely on runaway production and the state's tax credit program, is billed by co-sponsor Hollywood Chamber of Commerce as the "preeminent local forum" on the entertainment industry.
But the conference comes at an awkward time. State Sen. Ron Calderon, a major booster of TV and film production, is the center of a FBI probe alleging the senator took bribes over California's film tax laws.
With more film tax credits under consideration, entertainment groups worry the Calderon investigation will doom future legislation. Gregg Bilson, owner of Sunland-based prop house, called the scandal a distraction.
"It's going to dilute the conversation," said Bilson, chief executive officer of Independent Studio Services. "People are reading about this instead of the positive aspects of the film incentives."
Calderon authored legislation last year steering $100 million in tax credits to the entertainment industry, renewing the state's 2009 film tax credit program. The money, Calderon said, keeps jobs in California and makes the state competitive.
An FBI affidavit released by the Al Jazeera America network two weeks ago alleges an undercover agent posed as the head of a small Los Angeles film studio, offering bribes to Calderon. In return, Calderon promised to change the laws so smaller-budget films could qualify for film credits, the affidavit states.
The Montebello Democrat has not been charged, and the lawmaker's attorney has publicly dismissed the affidavit. Calderon suggested in a statement last week he was innocent.
But the federal probe comes as legislators were already preparing to try to expand the state tax credit program. Assemblymembers Raul Bocanegra, Mike Gatto and Ian Calderon -- Ron Calderon's nephew -- have been working on different pieces of legislation to expand credits, possibly to cover big-budget movies or TV pilots.
At an Assembly meeting last month in Los Angeles on the tax credit program, Bocanegra, D-Pacoima, and Ian Calderon, D-Whittier, heard from Bilson and dozens of other entertainment executives who want the program expanded. Ian Calderon, who co-chaired the event, isn't named in the FBI investigation.
In light of the investigation, lawmakers say they expect more questions. "We are cognizant to the fact that it might get additional attention because of what is going on," said Ben Golombek, Bocanegra's chief of staff.
Gatto, a Democrat who represents production-rich areas like Hollywood and Burbank, stressed the FBI probe "was an investigation of a legislator."
"This wasn't an investigation of the program," Gatto said.
California has offered incentives to the entertainment industry for nearly five years, an effort to curb runaway production and keep pace with competing states' programs. Films ranging from the CIA thriller "Argo" to the baseball flick "Moneyball" have taken advantage of the program.
To date, the program has avoided the type of scandals seen in other states.
In 2009, a Louisiana film official was handed a two-year prison sentence for improperly giving tax credits to a producer. And in 2011, numerous filmmakers were charged and state officials were fired in Wisconsin over fraudulent use of tax credits.
Amid the investigation, Calderon was removed two weeks ago from his position on the board of the California Film Commission. Senate President Pro Tem Darrell Steinberg also wants the senator removed from all his committee assignments at the Capitol.
California Film Commission executive director Amy Lemisch said the program's legitimacy has never been questioned. The tax credits help produce hundreds of jobs on sets, she said.
"It's never been questioned because we run a very tight operation and we have since 2009. We have strict audit procedures," Lemisch said.
But the FBI investigation could provide ammunition for those who oppose tax breaks for the film industry. California educators and lawmakers from Northern California have historically opposed expanding tax breaks. Those groups are expected to fight new legislation over the program.
Hollywood Chamber of Commerce president Leron Gubler hopes opponents see the distinction between the FBI investigation and the "positive aspects" of the film tax. The chamber is presenting Tuesday's conference, the "Second State of the Entertainment Industry Conference" at the Loews Hollywood Hotel, and featuring speakers such as Mayor Eric Garcetti and his entertainment advisor Tom Sherak, plus a range of Hollywood executives and other political leaders.
"It's unfortunate they chose the film industry for the sting," Gubler said. "Hopefully this will blow over by next year, hopefully people will see the value and importance of the credit."
Some entertainment executives say there is a silver lining to the bad publicity. Heidi Erl, a San Francisco-based production supervisor on "Moneyball," said the news stories may bring more attention to the film tax program.
"It doesn't reflect well, it's not good press by any means," Erl said. "But I have worked on enough shows where the bad press turned out to be good press."
(c)2013 the Daily News (Los Angeles)
Visit the Daily News (Los Angeles) at www.dailynews.com
Distributed by MCT Information Services
A service of YellowBrix, Inc.
Most Popular Stories
- Islamic State Obliterating Cultural Landmarks in Mosul
- The 2014 Fastest-Growing 100
- 'Lucy's' Super Powers Tops 'Hercules' at Box Office
- Boehner Says Impeachment Talk Is Democrat Scam
- You're So Vain: Microsoft to Launch First 'Selfie Phone'
- VW Site Could Mean Another 2,000 Jobs for Chattanooga
- RV Sales See Highest Increase Post Great Recession
- Report: China to Declare Qualcomm a Monopoly
- U.S. Home Price Gains Slow for 6th Month in a Row
- Insecticides Permeate U.S. Food, Water Supply