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State should promise
not to leave ‘Lost’ stranded

THE ISSUE Producers of the smash TV drama series "Lost" are considering relocating for financial reasons.

THE ABC television series "Lost" has been such a hit that it is difficult to understand it is a money loser. Competition among states in attracting film production has prompted the producers of "Lost" to seek a more economical location. State officials and legislators should assure the producers that help is on the way.

The series about airplane crash survivors stranded on a tropical island has been a huge success in TV ratings and has been nominated for an Emmy as best drama series. However, "Lost" may be the most expensive series to produce, costing as much as $2.8 million an episode. The series is losing about $500,000 an episode for a total of $11 million for the first season's 22 episodes. It is spending $45 million in Hawaii during this season.

A major reason for the relatively high cost of shooting the series has been attributed to backlash from the application of tax incentives enacted four years ago to attract high technology, including the film industry. Production companies for two movies, "Blue Crush" and "The Big Bounce," received especially high -- some suggest exorbitant -- tax credits.

Last year's Legislature extended the tax-credit law but tightened the criteria to qualify for the credits, up to 100 percent tax credits over five years. ABC/Touchstone intended to cut its expenses by using the law's tax credits, but the Star-Bulletin's Tim Ryan learned from sources that the state allowed fewer tax credits per dollar than the producers had expected.

The Hawaii Film Office, the local Screen Actors Guild and others in the film industry are proposing that the Legislature provide tax credits of 15 percent to 20 percent for money spent on film production. That is similar to tax credits offered to eligible productions by New Mexico, whose governor, Bill Richardson, lobbied major Hollywood producers last year.

Other states are increasing efforts to attract production. Hawaii now offers hotel room tax credits and other tax breaks to producers, but those are not as attractive as incentives offered elsewhere.

Ted Liu, director of the state Department of Business, Economic Development and Tourism, says he hopes to have an assistance package ready to present to "Lost" producers by the end of February. Liu properly is making sure that the package contains only assistance that will be available to other film producers.

The bill before the Legislature is not expected to be enacted until after ABC/Touchstone executives have decided whether to relocate. The state should be able to provide assurance before then that producers will not be stranded on a tropical island without assistance from the state.