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New Low Budget Theatrical Motion Picture Pact

Tuesday, January 6, 2004

The IATSE and a group of leading independent producers have renegotiated the only IATSE Theatrical motion picture Agreement that covers production anywhere in the United States. Several major breakthroughs were achieved in the negotiation of the Low Budget Theatrical Motion Picture Agreement, which became effective January 1, 2004, replacing the 2001 Agreement that expired December 31st.

In an effort to stimulate theatrical production by independent producers who found the prior $7 million low budget cap no longer realistic, the low budget cap will increase immediately to $8.5 million and to over $9 million on January 1, 2006. Additional budget flexibility is permitted by conforming budgets to current completion bonding requirements. The new Agreement continues to recognize the need of lower budget productions for operating flexibility. In turn, the producers participating acknowledged that crews willing to work on low budget productions should have appropriate working conditions and agreed to improved rest periods and meal provisions. Agreed increases in wages and benefit contributions will keep wage rates in step with the cost of living and support the viability of the health benefit and retirement plans covering employees who work on new low budget productions.

IATSE President Tom Short stated, “I hope other segments of the industry will support the leadership of the IATSE in recognizing the important contribution made by independent producers to motion picture production and employment by expanding the number of motion pictures that can qualify for “low budget” treatment. Our goal in this negotiation was to stimulate production and create jobs for our members that provide appropriate wage rates, benefits, and working conditions. I believe this Agreement achieves these objectives while meeting the production flexibility sought by independent producers.”

Production companies represented in the negotiation included Bob Yari Productions, Lion’s Gate Films and its newly merged affiliate Artisan Entertainment, Franchise Pictures, Intermedia Films, Lakeshore Entertainment, Miramax Pictures, and New Line Pictures.

The IATSE negotiating team was led by Vice President Matthew Loeb with the support of representatives from IATSE Locals from a number of geographical areas. The producers’ negotiating committee was co-chaired by Howard Fabrick of Akin, Gump, Strauss, Hauer & Feld and Richard Kopenhefer of McDermott, Will & Emery.

The IATSE is an International Union that represents members employed in the stage craft, motion picture and television production, and trade shows industries throughout the United States, its Territories and Canada.