IF IT WAS SLOW WHEN WE HAD AN 80 CENT DOLLAR
WHY IS IT SO BUSY WITH A 90 CENT DOLLAR?
Those of us that go back to the first film town hall meeting back in late 2004, when the local film
industry was slow, may remember the fear that was felt when the Canadian dollar had hit 80
cents US. There were suggestions of pegging the dollar somewhere in the 75 to 79 cent US range
to ensure we remained competitive. This may seem quite strange given that the recent fall of the
dollar to 90 cents US has, in no small part helped make 2014 a banner year in the film industry in
BC. Yes, the economy down south has been improving but tax credits in significant competing
film regions in North America, outside of LA and New York, have essentially remained
unchanged in the last 4 or 5 years. The drop of the dollar from par with the US to where it stands
now seems to be the most significant change in encouraging production since the “90%
unemployment” protest days of early 2013. So why is today’s 90 cent dollar better than an 80
cent dollar a decade ago?
While it is always an inexact science to speculate in situations where there may be no definitive
answers, I will do it anyway.
Unlike today’s dropping dollar, in 2004 the dollar was rising rapidly. From the beginning of
2003 until late 2004 the dollar had gone from about 65 cents US to 80 cents US. For an industry
that many locals felt existed due to our advantageous dollar, it was becoming concerning. But
there was another important factor at play.
Until 2002, Canadian film jurisdictions not only had the dollar advantage over our US
counterparts but we also had film tax credits. In 2002 this was about to change. With Louisiana
leading the way, in the next ten years or so, the majority of US states introduced their own tax
credits and their tax credits were often superior to ours. In one state they were so enthusiastic to
give out tax credits that the head of the Film Commission and the CEO of the largest production
company in the state ended up in jail.
It wasn’t just new states entering the film industry mix that put pressure on our local production
but countries outside North America. In BC we were also being “one upped” by other production
jurisdictions in our own country. It was concerning times.
Fortunately, the government increased our tax credits. Although the dollar continued to rise we
were able to get through the worst until early 2013 when we perceived another crisis. In 2013
there were fewer moving parts to our downturn and this time it was solved by a 10% drop in the
dollar.
In 2004 we were a film jurisdiction still establishing ourselves. Ten years later we are an
established jurisdiction, perhaps not requiring the financial advantages needed in the past. As
long as our crew and other infrastructure continue to evolve we will remain a top choice of
producers looking for locales to shoot their production.
Business Manager