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Billion Dollar Location – Canada: Production Ties Still Bind U.S. With Northern Neighbor

Variety logo Variety 4/11/2017 Katherine Brodsky
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Let us count the ways that Canada is an attractive place in which to shoot.

The country offers an outstanding assortment of locations, state-of-the-art facilities, and crews with vast experience working on everything from productions with budgets exceeding $100 million to small indie films.

A U.S. dollar will buy about $1.34 in Canadian currency, effectively allowing U.S. producers to get a dollar’s worth of production in Canada for about 75 U.S. cents.

On top of this, a patchwork of generous tax incentives throughout the country means that U.S. producers can get a very big bang for their bucks — in addition to luring producers from other countries. Plus, Canadians have a reputation as polite, tolerant people.

“We believe that incentives play an important role in positioning Canada as a partner and location of choice for producers,” says Mélanie Joly, Canada’s Heritage Minister. “Film and television production is a valuable source of economic activity in Canada.”

Last year, the sector generated more than 140,000 jobs and C$8.4 billion (about $6.27 billion in U.S. currency) in gross domestic product.

“This sector not only directly employs a wide range of creative workers with a variety of skill sets, but also creates spillover effects that benefit the whole economy,” she says.

A few years ago, the Canadian dollar had overtaken its American counterpart and production slowed down. Now the pendulum is swinging back in Canada’s favor. As the Canadian dollar sinks further, the number of U.S. productions shooting in the Great White North has risen to an all-time high.

When U.S. producer Marc Bienstock (“Split,” “Before I Fall”) was considering where to take his most recent project, “Life in a Year,” starring Cara Delevingne and Jaden Smith, he looked for a site that would serve the story esthetically and dramatically, as well as financially.

“We were looking for a city that has a film community and infrastructure for filmmaking that would allow us to make the biggest movie possible with our limited resources,” he says. Toronto had the northeast regional look he was going for, as well as a strong sense of seasonality that was integral to the film.

Canada is certainly not alone in offering tax incentives. Plenty of them can be found in U.S. states such as Georgia and Louisiana, “but once you combine the incentive with the exchange rate for the U.S. dollar, there’s a pretty compelling financial argument to be [in Canada],” says Bienstock.

His financial team keeps track of currency fluctuations, making buying decisions based on projections. “On $5 million, 1 cent is going to result approximately in a $50,000 slide, which doesn’t sound like a lot, but those are resources you can put on the screen.”

Veteran producer John Davis, whose sequel to the 1987 sci-fi “Predator” is filming in Vancouver, also is no stranger, having shot projects such as “Timeless,” “Chronicle,” and “I, Robot.” “Canada is a great place to shoot right now,” he says.

Davis is quick to praise the crews, infrastructure, locations, and the “reservoir of Canadian talent” in what he refers to as the pre-eminent production center of the world. “At the end of the day though, I always look for a location that’s right for the movie, but also the one that’s most inexpensive. That’s just the way decisions are made now.”

The financial factor is especially significant for $2 million TV movies that would otherwise struggle to be made, says producer Dan Paulson who discovered the advantages of filming in Canada years ago when he handed a waiter a $20 U.S. bill and got $21 in Canadian change. Since then, he’s spent so much time working on shows and MOWs for Hallmark and Lifetime in Canada that he’s actually claimed permanent residency, which also gives him some tax advantages.

“We have a model here that works,” he says. Tax incentives, rebates, and the cheap dollar are all part of the financial plan because “you can put more on the screen … we can make a better product for less and people here make a lot of money because everyone’s working.”

It’s rare these days to get to shoot in L.A., Davis says, and he doesn’t see that changing, despite California’s relatively new incentives package. “I don’t think anyone [in government] is focused on California [offering incentives similar to those in England or Canada],” he says. “I would love to shoot [in California] but the incentives just aren’t there. … Production in our state isn’t seen as a financial priority.”

Even with the more protectionist stance of the Trump administration, Bienstock doesn’t see any ramifications on the film industry in the near future. “There’s been an effort over the years to keep productions in the U.S., and, quite frankly if you look at it, Toronto is busy and Vancouver is busy, Atlanta is busy, New York is super busy, so there’s a ton of work going on and it appears there’s enough for everyone.”

Right now, says Paulson, the effect any new U.S. government policies might have is a bit of a wildcard. “I don’t think that borders will necessarily be affected,” he says. “We still have NAFTA, but if that agreement went away it wouldn’t be good. … Right now I’m paying the taxes in Canada because of the treaty, otherwise I would have to pay taxes twice, which would disincentivize us.”

For her part, Joly says, the “close ties between Canada and the U.S. will continue to play an important role in both of our countries’ film and TV production industries, as good middle-class jobs in all sectors rely on our strong connection.”

(Pictured: Fox’s “War for the Planet of the Apes” was shot in British Columbia.)

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