Backers: Studio is real deal
State funds denial a snag, they say
The state’s recent refusal to provide $50 million in infrastructure bonds for the movie studio planned in Plymouth surprised Plymouth Rock Studios executives as well as local officials.
But studio principals were quick to recover, getting a word of assurance out to Plymouth Rock followers late last week via their daily Internet blasts as well as through a press statement from company cofounder David Kirkpatrick.
The state’s funding denial, while disappointing, was just a minor snag, they said.
The question now is whether Plymouth officials as well as the general public believe the project remains viable. Last week, the state’s Executive Office of Administration and Finance said state economic experts determined that the net revenue from the $500 million studio wouldn’t be enough to cover annual payments on the $50 million bond.
“Public perception is now going to be impacted by action, and we’re moving toward action,’’ said Plymouth Rock partner Bill Wynne. “This is real. It’s going to happen. All the pieces are there, and there are no huge holes in the game plan.’’
The $50 million in bond money, under the state’s infrastructure investment incentive program called I-Cubed, was to cover construction of an access road to the studio site on the Waverly Oaks golf course, and to install other infrastructure such as water and sewer lines. The work is considered an important early step in getting the studio built.
Rock executives, in a preemptive move, told Plymouth selectmen two days before the state publicly announced its rejection of the bond application that they had already secured sufficient private funding for both the access road and the first phase of the building project. That includes construction of sound stages, back lots, and other film production components as well as some of the amenities.
Studio officials have offered to show the selectmen proof of the financial commitment, which would have to take place in a closed session since the names of investors have yet to be announced.
Selectmen chairman Dick Quintal said he planned to meet with studio principals some time this week. “I’m sad with the state and the governor, and the antibusiness message he sent with the denial,’’ Quintal said. “As far as the town goes, I’m optimistic this project will still go forward. There are a lot of jobs this will create, and that’s what we’ll be focused on.’’
Plymouth Rock was the first company to apply for bond money under the state I-Cubed program. According to Rock spokesman Kevin O’Reilly, just putting together the application cost the studio about $500,000. So far, Plymouth Rock has spent over $12 million trying to launch its project.
State officials with the Department of Revenue said the movie studio didn’t meet the requirements for I-Cubed funding, once all the tax credits to film producers working in Massachusetts were factored in, since it wouldn’t have enough net revenue for bond payments.
Wynne said the project’s yearly revenue will far exceed the requirements under I-Cubed - before the tax credits are factored in. The state, he said, never said it expected revenue from the studio project to cover the 25 percent in tax credits that film producers get.
Wynne said the state’s rejection also “blindsided’’ company executives for another reason: The money had been all but guaranteed for the project nearly two years ago. “It wasn’t just a verbal commitment,’’ Wynne said. “They put it in writing.’’
The letter that state economic officials sent to Rock executives in April of 2007 promised $103 million in incentives for building in Massachusetts. About $55 million in I-Cubed funding was on the written breakdown of perks.
Cyndi Roy, spokeswoman for the state Executive Office for Administration and Finance, said the 2007 letter from the state “was a proposal, not a promise.’’ She added the regulations for the I-Cubed program had not even been promulgated when that letter was sent.
“I take exception to the word ‘blindsided,’ ’’ Roy said. Wynne “was told in March that the film tax credits were likely to be considered,’’ she said, adding, “the administration continues to support the project and we’ll work with the developer toward identifying other sources of funding.’’
Quintal said the Memorandum of Understanding between the town and the studio will have to be redone since many of the terms of the agreement were based on I-Cubed funding for infrastructure. The town will have to share in some of that expense.
Company officials say they plan to put the I-Cubed rejection behind them. “Development is a process,’’ Wynne said. “In the big picture, this is minor and has no ability to derail the project.’’
Dick Silva, president of Yes To The Rock, a citizens group backing the studio, said members remain upbeat. “We heard a lot of things, and there were a lot of people confused by what we heard,’’ Silva said. “But I have all the confidence in the world in this project. They said they have the financing and I believe that.’’
Waverly Oaks will continue to operate as a golf course until the end of October. “We’ll move forward with the purchase when we’re ready to start work on the site,’’ Wynne said.
Christine Legere can be reached at email@example.com.