San Francisco: The New Hollywood?

“48 Hours.” “Princess
Diaries.” “Mrs. Doubtfire.” These are just a few of the megahit
movies that took place in San Francisco proper. Is San Francisco
positioned to become the next Hollywood?

With all of the innovations
coming out of San Francisco as of late, the City by the Bay may
become a businessman’s dream come true. San Francisco is known as
a city of independent-minded citizens, yet citizens who also cherish
their city as a global financial and business center. And with Mayor
Gavin Newsom’s recent forays into noticeable pro-business measures,
is the city moving more toward classical liberalism and libertarianism?

Keep in mind, also, that the notoriously “liberal” city of San Francisco
also was authorized by its citizens in 2003 to keep a “rainy day fund”
to save money. Mayor Newsom dipped into the fund on March 10, in order to save teaching jobs that were
otherwise threatened by hard times. In the statement, Newsom explained
the removal of $23 million from this fund to “save all of our teachers’
jobs… We are lucky in San Francisco to have saved our extra revenue
for when times get tough.” Food for thought, anyway.

On March 3, Mayor Newsom
announced a major investment into the City of San Francisco. The press release
associated with Newsom’s announcement hails Mayor Newsom for “Spur[ring]
Job Creation” with his unveiling of nearly $30 billion in proposed “capital investments”
in the city, for the city and county of San Francisco’s Proposed
Capital Plan for Fiscal Year 2010-2019.

The ultimate goal of this monetary infusion?
“To spur local job growth.” The investment of $28 billion will take place over a ten-year
period, and will be composed of $10.5 billion from “investments of… local
agencies” and $17.5 billion worth of “capital investments” from the city government.

Newsom cited infrastructure
additions and improvements, the creation of “high-paying jobs,” the rebuilding
of local “streets, parks, libraries… and… new residential and economic centers that will
sustain and transform our vibrant city” as the ways in which the $28 billion will be
dispensed over the coming decade.

The goal of this plan is
to “create at least 200,000 new construction-related jobs in San Francisco… At a minimum,
200,000 new jobs will be created through these projects in San Francisco with additional
jobs created around the Bay Area.” In the statement, Mayor Newsom noted that
in the face of a hard-hit national economy and a large city budget as well (reported
by the Mayor, in December, to be over $575 million), that leaders “must continue
to think strategically and invest in the people, infrastructure and businesses that will pull
our economy” out of the current slump.

On March 2, Mayor Newsom also
proudly announced that NBC will soon begin filming a television show,
to be titled “Trauma” on San Francisco’s very own Treasure Island.
Mayor Newsom stated that the production of the show “is a great opportunity
to create several hundred jobs and stimulate the local economy with
as much as $7 million in revenue.” Newsom went on to extol the beauty
of San Francisco, and its choice location as a “beautiful and welcoming
city.” The statement also references a recent Los Angeles Economic
Development Corporation study, which estimated that a T.V. production
of the size of “Trauma” would realistically create more than 300
jobs.

In a 2007 report commissioned
by the San Francisco Film Office, it was found that “although the
past few years have been difficult ones for the film industry in San
Francisco, the City possesses many advantages and his well-suited to
capitalize on significant trends affecting film, the broader media landscape,
and the Internet.” According to the report, the most recent statistic
showed that in 2004, filmmaking “directly provided 1,389 salaried
jobs in San Francisco.” The study concluded that “severe challenges
in infrastructure” prevented certain elements of the film industry
from expanding in SF, also making “the price of production” increase,
“making San Francisco uncompetitive in competing for film production,
forcing a contraction in the local performing arts, and driving down
employment in both industries.”

It was also noted that the cost of
filming in SF was the biggest barrier to more filming, and “the City’s
greatest weakness,” though the “locations and natural beauty of
the area, and the quality of life,” were good marks for the city.

To put this into context, the report showed that in 2005, Los Angeles
employed 127,671 people in the film industry, while San Francisco employed
6,782.

Since then, it appears that film officials in the Bay Area have
been working hard to drive business back home. The report concluded
with four goals: create better indoor shooting facilities, link together
films and digital technology [ahem, Mayor Newsom’s new online State
of the City addresses?], “promote locally-based production in San
Francisco” and the goal of making San Francisco and the Bay Area more
overall competitive for filming. The report noted that competing cities
were utilizing tax credits, tax rebates, grants, loans, sales and use
taxes and hotel taxes to attract filmmakers. The SF Film Commission
is now apparently moving to do the same.

The San Francisco Film Commission
publicly stated excitement over the news of the selection of SF as the
backdrop for “Trauma,” noting that the more exposure to San Francisco
via television series, the greater the amount of tourism to the city.
When contacted, the San Francisco Film Commission could not comment
further on the status of the city as a film and television production
hub. However, during the January meeting of the council (the most recent
meeting), an amendment to extend financial assistance to film crews
was put on the table. The Administrative Code encourages the promotion
of “film activities in the City.”

One of the ways in which this
is done is by offering rebates to film crews in SF, which are currently
capped by the amount of taxes paid by the crew. In the proposed amendment,
there would no longer be a cap dependent solely on taxes paid, but the
cap would be raised to $600,000 and would “remove sales tax and hotel
taxes paid to the City from the list of payments subject to the refund
process.” The stated purpose of the Film Rebate Program is to “increase
the number of qualified film productions being made in San Francisco,
increase the number of City residents employed in the filmmaking industry,
and encourage the resulting economic benefits to increased filmmaking
in San Francisco.” The rebate is explained as such: “The City shall
pay one dollar for each dollar the qualified low budget film production
or qualified film production paid in qualified production cost not to
exceed $1.8 million dollars by June 30, 2011. The rebate shall be paid
from the fund into which the qualified production cost was originally
deposited. In no event shall the amount of the rebate exceed
$600,000.00.

Cheers to the hopeful-Hollywood of the north.