Mr. Schwarzenegger, who bragged during the campaign that he personally intervened to get the production of his latest movie, Terminator 3, moved from Vancouver to Los Angeles last year, has been outspoken in his criticism of so-called "runaway productions" -- films and television series shot outside the United States.
Shifting Terminator 3 to California at the last minute "helped create jobs, hundreds of new jobs, and that's what I want to do as governor," he declared in early September. "I want to bring businesses back to this state."
Now that he's won, he is in a position to do something about it through changes in the California tax structure, the creation of incentives or simply by using his political position to sway the film industry.
Although Mr. Schwarzenegger may not have the inclination to take such action while he has much more pressing problems on his plate, "we are concerned," said Stephen Waddell, national executive director of the Alliance of Canadian Cinema, Television and Radio Artists (ACTRA). "The positions that we imagine he might take do concern us a great deal."
Most provinces have tax credit systems that give incentives to produce films, so it would be hypocritical to condemn any U.S. states from considering similar incentives, Mr. Waddell conceded. But it would still be very damaging to the Canadian industry if California moved in this direction.
The biggest worry for Canadians, he suggested, would be the "moral suasion" that Mr. Schwarzenegger could use on decision makers in the California film business.
"If he comes out against production leaving California, which has a further rallying effect on leading performers -- that's where we're really vulnerable," Mr. Waddell said.
"If the Harrison Fords, or other performers who can green-light a movie just on their participation in it, take a position that 'we're not working outside of California,' it's going to have a devastating effect on production in Canada."
Mr. Waddell is less concerned that Mr. Schwarzenegger is going to institute tax changes or incentives. Anything that would put more money into the pockets of the huge film and television production companies probably would be politically unpalatable, he said.
Mr. Waddell said production in Ontario is down 40 per cent this year, but the culprit is not a U.S. backlash against runaway productions. There's been a much greater impact from the outbreak of severe acute respiratory syndrome and the higher value of the dollar.
In British Columbia, provincial film commissioner Susan Croome said it is too early to determine if the new California administration will take any action to keep productions there.
Mr. Schwarzenegger "has talked about his intention to promote filming in California, but we really don't know what it is that they are looking at or planning," she said.
"I suspect that this is lower down on the list of things that need to be addressed with respect to the California economy."
Mr. Schwarzenegger's detailed political agenda, disclosed on his Web site, does not mention the film industry or the issue of runaway productions.
Ms. Croome said she is not worried about Mr. Schwarzenegger's influence on U.S. film companies' decisions to shoot in Canada because they "come here based on sound business decisions based on cost-benefit analysis."
Peter Leitch, general manager of Lions Gate Studios in North Vancouver, agreed that U.S. studios will shoot wherever "it is cost effective to do so." He doesn't expect any changes to that financial dynamic in the near future.
Still, if incentives are introduced in California, "we'll have to look at it and see how we can become even more competitive to keep the production coming up here."
The relatively high level of the dollar is a more immediate concern, he said, although "there is still a significant savings for [crews] coming up to Canada."
One vocal group of U.S. lobbyists would prefer that the new governor help the fight against subsidies and tax incentives in Canada and elsewhere, rather than instituting them in California.
The Film and Television Action Committee contends that Canadian subsidies, ranging as high as 44 per cent of payroll costs, "have removed three-quarters of U.S. long-form television production and one-quarter of U.S. feature film production from our shores." The impact on the U.S. economy is about $10-billion (U.S.) a year, the FTAC says.
The organization wants the U.S. government to use the provisions of the North American free-trade agreement to get the Canadian subsidies removed.
FTAC chairman Brent Swift said yesterday that his group has tried to contact Mr. Schwarzenegger about the issue but has had no response.
"His intentions are good," Mr. Swift said, but the FTAC is worried the new governor will consider offering new subsidies rather than working to eliminate them elsewhere.
