From The Times Herald-Record by Deborah Medenbach

By DEBORAH MEDENBACH
Times Herald-Record
Published: 2:00 AM - 09/07/10

Pieces of the puzzle are falling into place.

With the approval of the state budget in early August came confidence that an approximately $450 million pot of film tax-credit funding each year through 2015 would continue a job-growth trend in the state.

New York had been losing film jobs to surrounding states with more generous tax programs until 2008, when Gov. David Paterson signed a bill that increased the state's film tax credit from 10 to 30 percent.

Analysis since then shows the move stemmed the film job losses and more than paid for itself with a 1.9 return on investment.

Filmmakers say the impact is even higher.

"We spend so much money that it pays for the tax credit fivefold," said film producer Jonathan Burkhart. "They may allocate $1.2 billion over the course of the credit, but it generates $5 billion in income. That's taxable income in the state of New York."

Shooting the feature film "Peace, Love and Misunderstanding" in Ulster and Dutchess counties this summer, Burkhart gave an example:

"For the one day we'd be shooting in Rhinebeck, aside from paying location fees, we'll probably drop $15,000 in cash in six hours. "» We have a 90-man crew every day, plus the people in the production office. When we spend money, we touch everything."

New York is the only state that does not include actors, producers, directors and writers — known as "above-the-line" expenses — in its tax credit.

"It's about creating jobs and getting more crews to be hired. It has more direct impact if the credit is directed to below-the-line expenses," said Patricia Swinney Kaufman, executive director of the governor's Office of Motion Picture and Television Development.

Ulster County Executive Mike Hein said giving a tax break to one portion of the film industry helps strengthen all of the businesses in support.

"It's important to note that we have many local studios that do not receive the benefit of the state film tax credit because they are smaller," Hein said.

With an existing infrastructure of three certified soundstages in Ulster County, a new production studio in Kerhonkson and a list of available union cast and crew members at the Hudson Valley Film Commission that more than doubled in the last year, the region is well on its way to keeping the smaller studios humming, too, in what Kaufman calls the "industry cluster effect."

Real estate agent Eric Bean of Westwood Metes & Bounds in Stone Ridge said he's already been contacted by cast and crew members from several productions that filmed here this summer about renting or buying homes in the area.

"They know people who are already here and had good experiences working here," Bean said.

"I mean, Jane Fonda took a break from filming at the Saunderskill Farms (in Accord), and not one person bothered her. That would never happen in other areas. It's laid-back here."