Media Money with Julia Boorstin

From Hollywood: The Saddest Story Ever Told


The Los Angeles economy is already suffering from the economic downturn and the bursting of the housing bubble.

Now, new statistics reveal that filmmaking in the Los Angeles area is at an all-time low. The total number of days shot on-location in Los Angeles fell more than 14 percent to 7,043 in 2008, the lowest level since FilmL.A. began tracking film permits in the city in 1993.

Movie studios are leaving town in search for less expensive locations. They're seeking state tax incentives, now offered in nearly every state but California and overseas, where countries from Australia to Romania are making it cheap for Hollywood to come shoot, hoping to boost the local economy and tourism.

There are other factors hurting the business -- the delayed affects of the writers strike and ongoing concerns that the Screen Actors Guild could strike.

Entertainment industry economists are pointing fingers at state legislators and the "Governator" for not passing tax and other financial incentives to keep productions in Los Angeles. Governor Schwarzenegger proposed tax credits as part of an economic stimulus plan in November. But two months later the state doesn't have a revised budget, and with its coffers so empty it seems a tax credit would be unlikely to pass.

The sad state of finance in the entertainment capitol is also being felt by retirees of "the biz."

The Motion Picture & Television fund announced this week it's closing a hospital and nursing home by the end of 2009. This charity was started by Charlie Chaplin, Mary Pickford and other big stars with the motto "We take care of our own", and Jeffrey Katzenberg, Steven Spielberg, and stars including Tom Cruise and Brad Pitt all help raise money for the home. But it's been losing $10 million a year and its financial state will only get worse in this economy, so it'll be the latest of 70 hospitals that have closed in California in the past 12 years. The end of this era will mean 290 workers lose their jobs, but the charity says the 185 residents of its independent and assisted living facilities and the six health centers that serve 60,000 entertainment industry workers, will not be shut down.

The home will start moving its 100 residents to other long-term-care facilities in March.

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