Hawaii’s film industry is organizing amid a slump in shooting major television series and feature films to better fight for improved state incentives after a bruising legislative session earlier this year.
Leaders of the new effort recently announced the formation of the Hawai‘i Film Alliance, a multitrade coalition aiming to facilitate a rebound in business partly through more unified public messaging that can influence the Legislature, where industry incentives have been in play in recent years.
The organization also intends to support workforce development and improve infrastructure for productions that often employ thousands of local residents.
Vince Keala Lucero, a Native Hawaiian filmmaker and camera operator who co-founded Co Creative Studios, helped lead the creation of the new group with several other industry players who believe state leaders need to make tax credits for film work in Hawaii more competitive with other states and countries.
Lucero said considerable individual efforts have been made toward the goal, including work by the state’s Hawaii Film Office, but that they have not been effective enough.
“Nobody was really advocating for what the industry needs,” he said. “We weren’t unified.”
Other guiding members of the coalition include producer and waterman Brian Keaulana, veteran assistant director Wainani Tomich, Honolulu Film Office Deputy Film Commissioner Sanoe Damon and Irish Barber, local business representative for the International Alliance of Theatrical and Stage Employees.
One big sore point that motivated Lucero into action with the coalition was that Jason Momoa’s “Chief of War,” a historical drama about unifying the Kingdom of Hawaii, was only partly shot in Hawaii.
Lucero, a digital image technician and stunt camera operator for the show, said the Apple TV+ production debuting Aug. 1 hit a Hawaii tax credit cap that led to most of the show, a series with nine episodes, being filmed in New Zealand.
“It was a total shame,” Lucero said. “Because if we didn’t have a cap, it would have been here and would have spent all those millions here.” Such spending typically is concentrated on employment but also flows to food, rental cars, hotels and other things.
What’s worse for the industry now is a total absence of active big-budget productions in Hawaii.
“Because there’s no work, some of the best people we have are moving out of state,” Lucero said. “I’ve seen a lot of my friends (in the industry) not being able to afford the price of paradise, and so they’re moving to other places where production is more prevalent.”
The state has offered tax benefits for the film industry since 1997, and incentives have largely grown since then but also have been criticized over their cost and benefit.
Currently, rebates on qualified spending over $100,000 are 22% on Oahu and 27% on the neighbor islands. Qualified productions can include movies, TV shows, commercials and even broadcasts of long-running annual local events such as the Merrie Monarch Festival and Kamehameha Schools song contest.
Limits include a $17 million cap per production, and an annual payment cap of $50 million that allows unpaid balances to roll over to subsequent years.
Debated value
The Tax Foundation of Hawaii has called the incentives a “drain on the state treasury” with no rational basis for increasing and extending credits other than to keep pace with escalating incentives in other places.
A University of Hawaii Economic Research Organization analysis in 2021 recommended ending the program in 2030, saying the main reason productions film in Hawaii is access to the state’s natural and cultural capital.
Local economist Paul Brewbaker also has long questioned the merit of the program, and dryly noted last year that a reboot of “Hawaii Five-0” from 2010 to 2020 was not likely going to be made in Georgia where more attractive film tax credits exist.
Lucero said the new coalition aims to counteract such views and public perception, which can affect legislation that potentially helps or hurts the industry.
The coalition’s web site at hawaiifilmalliance.org describes extensive economic benefits from the industry supported by tax credits.
According to the alliance, the incentives generate a five-fold return in economic activity, supported 2,247 jobs in 2024, led to an estimated 15% to 20% increase in tourism for locations featured on screen and resulted in an additional $1.3 billion in Hawaii visitor spending.
The state Department of Business, Economic Development and Tourism has long touted the program as a net benefit to Hawaii’s economy.
DBEDT’s most recent cost-benefit analysis published in 2024 was based on 2022 credits and said the amount of spending in the local economy by productions, including wages paid to local cast and crew members, far exceeds tax credit payments.
The study said $68 million in 2022 credit claims stemmed from $260 million in contributions to the state’s gross domestic product, including $159 million in personal income. The report also said tax revenue generated by all productions qualifying for credits in 2022 amounted to $35 million, or about half of the credit payments.
“One dollar of Hawai‘i’s film tax credit generated 52 cents of state tax revenues,” the report said.
Lucero said productions seeking a Hawaii backdrop are attracted by places that offer similar scenery, including Mexico, Puerto Rico and New Zealand, while some countries are offering incentives of 30% to 40%.
Opinions vary on if or to what extent Hawaii’s $17 million per-production cap and $50 million annual payout cap limits the industry. The annual cap has been in place since 2019, when it replaced a prior $35 million cap.
Ups and downs
Annual credit payments dropped from a record $80 million in 2018 to $39 million in 2019, but rebounded to $68 million in 2022 and then fell to $22.6 million in 2023. DBEDT estimates 2024 claims at $24.5 million.
To some degree, the volume of shooting big-budget TV shows in Hawaii depends on the success of the product with viewers.
For instance, a Fox TV series about Hawaii lifeguards, “Rescue: HI-Surf,” filmed 19 episodes on Oahu in 2023 and 2024 but was canceled after one season that ended in March.
Entertainment industry publication Deadline reported in a story that ran on May 12 that Fox Entertainment CEO Rob Wade said the decision was based on the reception from viewers.
“It certainly wasn’t the locale or the budget,” Wade told Deadline. “It just didn’t quite grab the audience.”
According to DBEDT, tax credits for the show totaled about $215,000 in 2023 and $10.2 million in 2024.
The biggest tax credit claim in 2024 was $11.3 million for “NCIS: Hawai‘i,” a crime drama that CBS canceled in 2024 after three seasons.
Legislative action
In recent years, industry supporters have pushed for a higher annual cap and other improved benefits.
Earlier this year, Senate Bill 732 proposed to increase the annual payout cap to $60 million. Other provisions later added to the bill included nixing the $17 million cap per production, waiving county permit fees for certain film activity, providing an extra 5% credit for qualified productions employing at least 80% local workers and phasing credits out over five years.
On March 31, more than 400 film industry workers and supporters rallied outside the state Capitol in advance of an April 2 hearing on the bill held by the House Finance Committee in a packed conference room.
Angela Laprete, a local producer who is helping to lead the new coalition, advocated for passage of the parts of the bill that she said would lift up the film industry and restore thousands of jobs.
“This economy booms when a production comes to town — small businesses, restaurants, hotels, stores — everything tourists bring, we do in bigger numbers,” she said.
Different versions of SB 732 passed the full House and Senate, but stalled on April 25 in a conference committee of House and Senate members who could not agree on a compromise.
Rep. Greggor Ilagan, chair of the House Committee on Economic Development and Technology, suggested that they try again next year.
Sen. Lynn DeCoite, the bill’s introducer and chair of the Senate Committee on Economic Development and Tourism, was resigned to agree.
The new coalition, in its formation announcement, thanked DeCoite (D, East and Upcountry Maui-Molokai-Lanai) and said it appreciated the effort by Ilagan (D, Hawaiian Paradise Park-Hawaiian Beaches-Leilani Estates) to support the industry.
The coalition added that a recent welcome sign for the industry was the appointment of a new House Finance Committee chair, Rep. Chris Todd (D, Hilo-Keaau-Ainaloa), who replaced Rep. Kyle Yamashita (D, Pukalani-Makawao-Ulupalakua) after the session ended.
Yamashita had introduced a bill to impose an automatic five-year sunset on every income tax credit established or renewed after the end of this year, or phase out such credits over three years. That measure, House Bill 796, passed both the House and Senate despite pleas from film industry members who said it would be a death knell for their livelihoods.
On July 3, Gov. Josh Green vetoed the HB 796.
The coalition, in its announcement, thanked the governor, saying, “With the recent veto of HB 796, Governor Green protected all tax credits which allows the film tax incentive through December 31, 2032, effectively keeping Hawaii’s film industry among the most competitive locations in the world and decidedly open for business.”
Source: The Garden Island
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