NEW YORK — Having experienced some success at convincing Hollywood film companies to make more movies at home, Gov. George Deukmejian Thursday night tried to persuade Madison Avenue advertising executives to use California locations in more of their television commercials.
Deukmejian, whose efforts on behalf of the movie industry until now have been concentrated on halting the flow of runaway film production out of California, promised advertising agency and TV commercial executives special help on a range of concerns such as speedy permit approval and assistance in obtaining a special sales tax break.
The governor made his pitch to advertising executives during a $12,000 cocktail party at a hotel near Central Park.
State officials said the tax break mentioned by Deukmejian in remarks to more than 100 advertising industry representatives would save film producers about $10 million annually by eliminating the 6% sales tax currently levied on post-production services such as film editing and sound-dubbing.
Deukmejian appeared to be a hit.
James J. Barry, senior vice president of Campbell-Ewald Co., said, "This is a real nice move on the part of California to show that they are hungry for business." Barry, who helps produce commercials for Eastern Airlines, Chevrolet and Bridgestone Tires, said commercial production dollars represent "a good piece of revenue."
Barry and several others in the New York advertising industry said California appeared to take for granted that everyone in the film business knows what it has to offer. Deukmejian, in his brief remarks, said he hopes to change that perception.
"The very fact that we are here underscores the fact that we have a new attitude," he said.
Specifically, Deukmejian is concerned about maintaining Califor nia's current level of television commercial production as well as stealing business away from rival states such as New York and Florida. New York currently ranks first among states in producing television commercials. California is second. Florida ranks third.
There are no reliable figures about the relative amounts of commercial business each state does. But Deukmejian Administration officials estimate that California now receives about 30% of the roughly $1 billion spent annually producing television spots, not counting the cost of air time.
Deukmejian said he wants to sell producers of television commercials on "what we have to offer" in California--a wide variety of good locations, favorable weather conditions, an abundance of technical and creative talent in Hollywood, and the assistance of the California Film Commission, which he helped set up in 1985.
The first job facing the commission was to stop runaway film production, the trend by California movie makers to make more and more films out of state. The Film Commission and Deukmejian believe the trend toward out-of-state production has turned around. The commission, in a midyear report, said that film starts in California this year are up 80% over what they were in 1985 and have increased 32% since 1986.
'Able to Turn Corner'
Deukmejian earlier this week boasted that California has "been able to turn the corner" on production of feature films outside the state. "We've been increasing the number of film starts in California in the last couple of years. We've stopped, really, the major bleeding that was taking place," he told reporters in Sacramento.
For Deukmejian, the pitch to ad agency executives is part of a much broader program he has developed to promote California business, foreign trade and tourism. As part of the campaign, Deukmejian last year opened trade development offices in London and Tokyo.
Politically, the reception will also help Deukmejian maintain close ties to supporters in the film industry. During his last reelection campaign, the entertainment industry gave Deukmejian more than $116,000 in contributions.
Lisa Rawlins, director of the Film Commission, said she hopes the sales campaign will create "dollars and jobs for the state."
Rawlins pointed out that a film company shooting a new movie in Mendocino, a coastal community frequently used by film makers wanting to capture the look of New England, recently made out $395,778 in paychecks to local residents hired to perform various jobs.
Sales Tax Revenue Cited
According to a commission report, the average feature film shot entirely in California generates $85,800 in sales tax revenue for the state.
Rawlins said television commercials operate on substantially smaller budgets, but are still worth pursuing. She said that $38,000 was spent in the small desert community of Mojave recently by a firm shooting a commercial for a Japanese auto maker. "That might not sound like a lot, but for a community like Mojave it was quite a shot in the arm. They spent $3,000 alone on soft drinks," she said.
Rawlins said that advertising agencies spend an average of $124,000 per spot. "It's an industry rule of thumb that one third of the production budget is spent on location," she noted.
Since 1985, Rawlins added, Film Commission officials have made annual visits to New York ad agencies. But this is the first sales trip by the governor.
Rawlins' office assists film makers in finding locations and it helps them cut through red tape by expediting often time-consuming government permit procedures. The commission maintains a library of 50,000 photos of possible locations in California.
In the past, Rawlins said the state charged film companies $800 to $1,400 a day to use state property. Since the state stopped charging in 1985, "the use of state property by commercial film makers has quadrupled," she said.