Film: Eight Below (Original Movie Title: Antarctica)
Location: Filmed in Smithers, Northern BC, Canada; Population approximately 5,000
Film Commissioner: Karen Cameron, Northern British Columbia Film Commission.
Disney invited the Northern BC Film Commission to be as involved as they wanted to be in the development of an economic impact study. Disney shared the figures requested by the film commission, although not all productions may be as willing to participate in this fashion. The commission was prepared to survey local businesses if Disney did not want to share the information. A consultant was hired to work with the film commission and it was decided that a provincial model would be used to collect and report the data.
It was determined that a multiplier of 1.87 would be used in this study because the Northern BC Film Commission is a regionally based commission; the communities in the region are geographically close, and the production was not only focused on the city of Smithers. The multiplier was developed by the Province of BC. It was determined that data would be reported to show the effects of the production regionally. A study isn’t something the Northern BC Film Commission would do for every production, as they can be expensive and time-consuming.
The report provided good news for the area and many stakeholders such as the board of directors, government officials, and film industry personnel were happy to receive the information. This was fairly simple study; many are more complicated. Participation by the Disney Studio was very important because it was used to show the value and impact of creative resources. Had Disney not been involved, the final economic impact figures would have been much more conservative. The total cost of the study was between (Canadian) $3,000 and $4,000.
Film: The Last Samurai
Location: Filmed in Taranaki, New Zealand; Population approximately 100,000
Film Commissioner: Paul Voight,
Film Venture Taranaki
The main reason the Film Taranaki Region conducted its economic impact study was the need to justify the film commission’s existence to government funders, and to demonstrate the importance of a major studio film to the respective economies in New Zealand.
The Last Samurai, a Warner Bros. picture, began working with Film Venture Taranaki about a year before actual production began. New Zealand was chosen as a filming location because it was possible to replicate areas of Japan there. In addition, the local community had skilled crew and craftspeople available for wardrobe and set construction. The film was shot in three countries including New Zealand over about five months which represented about 75% of the total filming. The budget was approximately U.S. $112 million. The area used had a film commission office in place since 2001 and was able to provide on the ground support for the production, however, the area’s film infrastructure was underdeveloped and it had little experience in providing more complex film production support. Close to the end of the shoot, the Film Taranaki Region undertook an economic development study focused on the country and the region, not just on one of New Zealand’s larger cities.
Film Venture Taranaki contracted a company to develop the framework and the methodology for the economic development study and standard industry practices were used. The study began with the creation of budgets indicative of the entire production. Warner Bros. was able to provide budgets for the art and locations departments. The balance of the budget for build ups was created by experts in economic development. These consultants conducted interviews with key suppliers in order to obtain actual figures as well as anecdotal information. For example, the shoot took place during the hot summer months, and a bottled water supplier was spending approximately $15,000 to $20,000 USD to supply cast and crew.
A multiplier was established and it was in line with the local Treasury. This was a relatively conservative figure. It was estimated that of the U.S. $16 million spent, 58% of that was spent in the Taranaki region, rather than nationally. The gross output calculated using the economic multiplier was $125 million USD. The shoot added another $17 million USD to the GDP, and the picture employed 1,400 full-time equivalent employees.
In addition to the economic impact, the product created other legacies. The Japanese village used in the filming still stands and continues to draw tourists, for example. The shoot provided a catalyst to a region that had been in the doldrums. It also created a sense of pride among local residents which can have significant long-term impact on a community. For the Taranaki Region, film production is now seen as a viable alternative to traditional industry activity and the film commission and other organizations have been pursuing additional production opportunities.
Warner Bros. reviewed the economic impact study in a draft form to confirm that the methodologies and breakdowns used were correct. They confirmed the figures were on the conservative side.
The Lord of the Rings trilogy was also filmed in New Zealand, however, there was no economic impact study undertaken for these films. The lengthy and elaborate shoot took place from 1999 to 2003 with principal photography done from 2001 to 2003 and approximately three months of pick-up each year. Miniature and model shooting was also done between 1999 and 2003. New Line Cinemas announced expenditures of U.S. $320 million, with approximately a 90% spent in New Zealand.
Other important economic impact factors developed as a result of Lord of the Rings. Media coverage was intense. The New Zealand government became a strategic partner with the media and hosted the world premiere of Return of the King, with New Zealand becoming the permanent home to Producer Peter Jackson’s production houses. Over 200 media covered the premier and provided global coverage. It was estimated that the equivalent advertising value was U.S. $100 million (this figure provided by New Line Cinemas). It is difficult to measure the actual cost of additional media coverage, as well as the ensuing Oscar nomination buzz.
The original motive for the economic impact study associated with The Last Samurai was to educate funders and government staff who didn’t understand economic impact and regional impact of film and the creative industry. New Zealand is now viewed as a center for innovative screen production, with new infrastructure and talent in the country and new businesses that have started up to serve the production industry. Tourism has provided themed attractions and the country has undergone a complete re-branding. Once associated with mountains and sheep, it is now known as an innovator in a much wider creative sector. Screen production is now a key industry for Film Taranaki and all of New Zealand. These spillover effects are difficult to measure.
In the appendices to this handbook, you will also find an example of an economic impact report from the Gold Coast in Australia. This is a report that spans a period of years and reflects a number of important data elements you could potentially review in your own jurisdiction. The report, “The Economic Contribution of Film Production to the Gold Coast Economy,” provides an excellent example of contributions not only from feature films but from other production activity as well.
There is a lot to understand and use to create an economic impact report for your region. Be sure you start with a simple report and then move towards more detailed reports as you gain confidence about your skills and resources from which you can work. If you are comfortable involving your economic development office, please do so, as they can be an invaluable resource for many film commissions.