Saskatchewan can’t afford to turn its nose up at movie millions

News | by Gregory Beatty

When the Saskatchewan Party government delivers its 2019–20 budget on March 20, it will mark the seventh anniversary of its controversial decision to axe the Saskatchewan Film Employment Tax Credit. Canada’s film and TV industry have been in full-on boom-mode the last few years, so it’s hard to say how much money that decision has cost the province.

But here are some numbers to chew on.

The figures are from 2016–17, which means they’re likely higher now, but according to the Canadian Media Producers Association, screen-based media production generated $12 billion in economic activity in 2016–17. That jumps to $23.6 billion when the “full sector value chain” — production, distribution, film festivals, broadcasting, etc. — is considered.

Toronto and Vancouver capture the lion’s share, but regional centres such as Calgary, Halifax and Winnipeg are also doing roaring business. Between April and December 2018, for instance, Winnipeg did $210 million in film and TV production. The city started 2019 strong too, with Amazon announcing in January it would be shooting a multi-million dollar science-fiction series Tales From the Loop in the Manitoba capital.

So yeah, the hit to Saskatchewan’s treasury has been big. And it’s not limited to film and TV either. [See sidebar]

Spilled Milk

Saskatchewan’s film and TV industry was a few years removed from its $70 million a year heyday in the mid-2000s when the Sask. Party cut the tax credit in 2012, but it was still a viable industry. As predicted, most of the workers and service companies left for other cities and are now contributing to their thriving scenes.

In the seven years since, says ACTRA Saskatchewan’s Mike Burns, the government and industry have never stopped talking.

“There’s no point crying over spilled milk,” Burns says. “They made a choice, and we’re just trying to show them that we can make it work again if they want to. It could start with a small project, just to get a crew going again, and maybe get a small series.”

Getting a quality crew together would be a challenge initially, says Burns, but Saskatchewan has an ace up its sleeve in the old Canada/Saskatchewan Sound Stage in Regina.

“It’s our greatest asset,” says Burns. “They’ve built a nice sound stage in Calgary, but the ones in Winnipeg are kind of crappy. Then the ones in Toronto and Vancouver, they’re booked three years down the road. If we had even a half-assed tax credit, or a bumped up grant system, we’d have the place humming.”

The grants come courtesy of Creative Saskatchewan, an agency the Saskatchewan Party established in 2013. It’s geared to promoting arts entrepreneurship, which is a worthy goal. But agency funding is limited so grants are pretty modest — only up to $600,000 for feature films — and programs are quickly over-subscribed.

“There’s some real pluses for small local producers to have up-front money,” says Burns. “But with a film tax credit you can attract broadcasters and studios that are doing larger-scale projects. I think the long-term solution would be to have both.

“Bring back the tax credit, but keep the grant system as it really serves a niche with smaller productions.”

Glaring Hole

Regina-based Java Post is one industry stalwart that has stuck it out since the loss of the tax credit.

But it hasn’t been easy, says partner/supervising producer Randy Shumay.

“It was a really big dent in our business,” says Shumay. “There were different episodic television shows and films that were being shot in Saskatchewan. We specialized in post-production, and that wasn’t happening any more. The sound stage was empty, whereas it used to have sets that were seasonal.

“They were churning out productions all the time, and we were part of that,” he says.

When it comes to film and TV, the actors and director grab most of the headlines.

But they’re just the tip of what amounts to an industry iceberg.

“When I take my son to a movie, we always watch until the end of the credits,” says Shumay. “You see the names of all these people, as there’s so many jobs that make the production happen.”

When I met Shumay, Java Post was doing final colour correction with a Montreal producer for a movie shot in Vancouver. They also do some corporate work shooting commercials and communication videos, along with the occasional independent production.

But otherwise, pickings can be slim.

“We have a great facility, but it’s pretty tough to entice producers to come here,” says Shumay. “People are always happy with our work. But if they can move one province over, and save tens of thousands of dollars based on their incentive program, obviously they’re going to pick that over here.”

One sideline Java Post has expanded into is drones. That’s a growing technology with application in mining, agriculture, real estate and other industries. Sometimes, the company even gets called in to do drone work on film and TV projects shooting in neighbouring provinces.

“Our reputation is well-known enough that we get contacted by film producers who want us to come in for a two or three-day shoot,” Shumay says. “These are big projects with big budgets and large crews, so it’s great to be a part of that. Unfortunately, we can’t entice any of them to do any post work with us.”

Because of limited revenues, Java Post has to run a bare-bones operation. That can make keeping up with the latest technology a challenge, says Shumay.

“Technology is always changing. To keep up, we have to ensure the equipment can pay for itself in a reasonable time. I think we’re doing okay with staying up to date, but it does put us in a bind.”

Assembling a skilled crew, especially in the summer and other peak periods, is a challenge too. Same with getting the high-quality gear needed to shoot bigger projects. Saskatchewan once had a core group of suppliers, but now gear has to be imported from other provinces.

“Sometimes I see a graphic of what’s filming in Canada,” says Shumay. “Vancouver will have 30 productions, Alberta and Manitoba, there will be a dozen or so. And then for Saskatchewan, there’s this glaring hole with nothing listed. And you can’t help but think, ‘My goodness, we really could have a piece of that large pie’.”

In the old analog days, Saskatchewan faced real disadvantages in trying to compete with bigger centres in film and TV. The film employment tax credit the Roy Romanow NDP government introduced in 1998 gave the province the leg up it needed to compete.

With digital media, the geographic barriers Saskatchewan once faced in attracting business have disappeared. Yet here we sit, without an industry that, in other provinces, is a major economic driver.

“We recognize the government has to make tough choices,” says Burns. “But we think there’s value, not just in film and TV, but with the whole idea of innovation in Saskatchewan. Right now, there’s a brain drain. I know so many people in their twenties and thirties — as soon as they’re done school, they’re gone to Vancouver, Toronto, Montreal, Winnipeg and Calgary.”


Canada Rocking, Saskatchewan Sucking

Film and TV isn’t the only creative sector where Saskatchewan is missing out. There’s also the booming video game industry which, worldwide, is worth an estimated $100 billion.

For comparison purposes, music is valued at $17 billion.

And as it happens, Canada is a major “player” (haha) in gaming, says local tech entrepreneur Kai Hutchence.

“Canada is the third largest producer of video games behind the U.S. and Japan,” says Hutchence. “China’s trying to move fast on that. So is Britain. So when you consider who we’re competing against, that’s pretty amazing.”

Ottawa, on the strength of software companies like Nortel, was an early leader. Toronto and Vancouver were in it from the start too, and lately they’ve been joined by Montreal as part of a broader tech surge that’s revitalized its economy.

Halifax, P.E.I. and Winnipeg are other hotbeds.

“Saskatchewan, sadly, there’s almost nothing,” says Hutchence. “But Winnipeg just made a major announcement with Ubisoft building a studio there. So all of a sudden they have one of the largest and most successful video game companies right downtown.”

Ubisoft is based in France, but has a strong Canadian presence — one that extends beyond gaming, say Hutchence. “In Montreal, the tools and capabilities they built in 3-D modeling were so powerful that they have a $1 billion a year office that does 3-D modeling for aeronautics, automotive, architectural and medical engineering.”

It’s no coincidence that Canadian cities with vibrant gaming industries all have strong film and TV industries. The tech side is undoubtedly important when developing a game, but the creative side is important too — and that’s where writers, animators, musicians, voice actors, post-production staff and other “creatives” come in.

Film and TV benefit, in return, from a thriving gaming industry, Hutchence says.

“If you want to have a successful TV or film production, and earn money off your creative project by keeping your fans engaged, you put out an app or interactive website that supports it,” says Hutchence. “Good game design will keep viewers engaged and make them buy into your product in a way that nothing else will,” he says. “It’s such a powerful marketing tool.”

Step one in building Saskatchewan’s gaming industry, says Hutchence, is investing in education to improve coding skills.

“The demand is huge. Our kids want the opportunity. They deserve the opportunity. It’s just a matter of putting some seed money into workshops and training programs.”

Step two would be getting an effective government incentive program. Creative Saskatchewan has experimented with an Interactive Media grant, and is now supposedly revamping it. But no support is available at present.

Hutchence has organized several well-attended Game Jams in Regina, and Saskatoon’s Noodlecake Studios has enjoyed success both as a developer and more recently, a publisher of games by other developers. So the potential certainly seems to be there.

“This is what society is doing,” says Hutchence. “This is where the market has moved. We’ve already lost a generation, and out-migration proves we continue to fail to provide a future for young people.

“Until we actually invest in building that future, kids will continue to pour out of Saskatchewan.” /Gregory Beatty