When you think post-apocalyptic North America, you think western North Carolina, right?
That’s what Lionsgate Entertainment is betting on. On March 23, the über-hyped Hunger Games will open worldwide. The movie is expected to make millions for Lionsgate Entertainment and author Suzanne Collins despite being made on a relatively shoestring budget for a project of this magnitude. That assumes that audiences will buy into the story as authentic which is, of course, where setting comes into play.
The movie was filmed in 2011 using a number of North Carolina locations. Most of the arena scenes were filmed in western North Carolina, in and around Asheville. Filmmakers also relied on footage from Pisgah National Forest, near the town of Brevard, and DuPont State Forest. Scenes of the Capitol were shot in Charlotte and its much smaller neighbor to the northeast, Concord, while District 12 filming was divided between the hamlets of Shelby and Hildebran. All in all, nearly 100% of the film was shot in North Carolina.
Why North Carolina? Well, besides the fact that it’s beautiful (yes, of course, I’m biased since I was born and raised there), it’s relatively inexpensive. That mattered a lot to Lionsgate which was hoping to make Hunger Games for a mere $60 million. Costs ballooned to $90 million but were kept low by subsidies and state incentives from the Tarheel State.
One particularly appealing incentive is the state’s film tax credit. On July 22, 2010, Gov. Bev Perdue signed into law a new Film Incentive Credit that provides a 25% tax credit on productions spending over $250,000 in qualified expenses within the state up to a maximum of $20 million. The credit is refundable, meaning that to the extent that the credit exceeds any taxes due, the overage will be refunded to the production company.
To qualify, production companies need to spend money in North Carolina. That’s not too hard since eligible spending includes payment for services performed in the state (as well as per diems, living allowances, and the like), regardless of the tax residency of the recipients. So, Kentucky born Jennifer Lawrence, who was said to have been paid just $500,000 for her role as Katniss Everdeen, didn’t need to relocate to North Carolina for her wages to be considered for the credit. Similarly, Stanley Tucci, Elizabeth Banks, Josh Hutcherson, and other actors in the film can stay put; their wages also qualify for the credit so long as their services were performed in North Carolina.
Will the film credit pay off? Perhaps. Even before the opening, Hunger Games is said to have brought in nearly $60 million to the Tarheel State. In addition to Lawrence and the stars of the film, the production employed a whopping 5,000 people, many of them locals who worked as extras. In addition to the taxes paid on those wages, that means money spent by the cast and crew eating, drinking, – and apparently, ziplining.
In addition to money spent on filming, N.C. is hoping for a little something extra: good publicity. To qualify for the tax credit, productions are required to give on-screen credit to North Carolina. That publicity will – the state hopes – to lead to increased tourism; Asheville already has a Hunger Games section on its web site where you can sign up for a movie-themed vacation package.
Amanda Baranski, Executive Assistant & Assistant Corporate Secretary for the Western North Carolina Film Commission, agrees that publicity can lead to a pay-off for the state. She says that the movie industry definitely makes a huge impact on tourism. “People want to be where the film was,” she says, noting that years later, people still flock to western North Carolina to see where The Last of the Mohicans was filmed. It’s one of a number of films that draw folks to the area, including Dirty Dancing, Hannibal, Patch Adams, and Forrest Gump.
Baranski credited Gov. Perdue with being “very proactive” in her efforts to push the film tax credit through in 2010. The credit had been somewhat controversial when, in 2009, despite a gaping hole in North Carolina’s budget, it became apparent that other states were willing to wave more incentives at film companies. That year, the poster child for the new tax credit became Miley Cyrus’ project, The Last Song, which was signed on as a Wilmington, NC, project but moved to Savannah, GA, after Georgia offered Disney “more lucrative incentives to shoot there.” While North Carolina believes that the film tax credit boosts its economy, some states haven’t been so lucky with Connecticut has reported a loss on each dollar of investment in the industry. Michigan and Wisconsin reported similar losses. And, of course, there’s the reality that all publicity isn’t good publicity: New Jersey yanked its tax support of Jersey Shore because, well, have you seen the show?
That is, of course, the concern about film-related tax credits. If all goes well at the movies and the dollars flow back, states can share in the good fortune. But it’s a difficult balance to put out enough incentives to woo moviemakers without bankrupting the state in the process. Like the movie itself, it’s a game. And not everyone can be a winner.
