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From "Hee Haw" to Hollywood

When people think of Nashville, most people think of one thing: country music. Legendary venues such as the Grand Ole Opry and Ryman Auditorium are the popular sites, but dozens of smaller music venues such as the Bluebird Café, Tootsie's Orchid Lounge, and the Wildhorse Saloon dot the Nashville landscape as well. Public administration officials tout the name "Music City USA" as a way to capitalize on tourism and entertainment revenue. In fact, the city's new $585 million convention center, to be completed in 2013, holds the name Music City Center. The city has been no stranger to celebrity sightings, red carpet events, or music video shoots, but when television dressing room trailers, film equipment trucks, and stars such as Connie Britton (well-known for her roles in Spin City and Friday Night Lights) rolled into Nashville, the landscape began to change.

For some time now, cities around the Southeast, such as Atlanta and New Orleans, have increasingly seen growth from the film industry. Nashville is now joining the ranks. When the new ABC prime-time drama Nashville started filming during the summer of 2012, it produced a spark in Nashville's television industry and has infused millions of dollars into the local economy. Nashville residents, city and state officials, film industry workers, caterers, hotels, and local attractions are taking note of the economic impact on the state's capital city from filming each episode.

Crews of approximately 150 people work on the filming and production of the show, which is scheduled to last at least through the end of 2012. The direct and immediate expenditures can be quantified in several different ways. For instance, some of the television crew members are from out of town, so things such as food and lodging expenses and trade done with local vendors can add up. Local craftsmen such as electricians and carpenters have been recruited to work on the set. Additionally, some 350 to 400 Tennessee vendors have been involved in the show's production.

Producers of the show estimate that $44 million in direct spending could occur in Tennessee if the full 22-episode season is filmed in Nashville. While the longer-term benefits can be impossible to measure, the show's producer considers it "a 43-minute advertisement, prime time, once a week" for Nashville each time the show airs. About nine million people watched the premiere. In a perfect world, this would equate to nine million people potentially wanting to visit Nashville and spend money on souvenirs, food, and visiting local attractions. The Blue Bird Café, which is featured prominently in the show, is collecting little direct immediate revenue, but the publicity it is receiving could result in revenue for years down the road. John Valentine, vice president of Lionsgate, which is one of the production companies filming Nashville, estimates the overall impact could exceed $75 million in one season. This sum, of course, is contingent on the show being extended from its current 13-episode deal to a full 22-episode season.

The city's mayor, Karl Dean, is pleased that the show can provide national exposure to Music City and views it as an asset to Nashville's national profile. Of course, this exposure comes with a price. The state's Economic and Community Development Department has approved reimbursable grants of $7.5 million for the show, which covers 17 percent of spending in Tennessee if a full season airs. A combination of state grants and an additional tax credit has allowed the show to obtain incentives that accounted for 32 percent of the Tennessee-based costs. Based on recent legislation changes that would cap reimbursements at 25 percent, Nashville producers hope to convince state economic and community development officials of a larger, multifaceted incentive package.

Far removed from the barnyards and cornfields that we used to see on Hee Haw, country music is now big business. Music Row is alive and well in Nashville and cashing in on the glamorous side of country. The small screen drama of romance, music tour deals, and even a little local politics as seen on Nashville is providing the old pickin'-and-grinnin' sessions with some competition in the Music City. And if you've never been to a pickin-and-grinnin', well, then you're missing out; come to Nashville and experience one of the finer things in life.

By Amy Pitts, senior REIN analyst, and Troy Balthrop, REIN analyst, both at the Atlanta Fed's Nashville Branch

October 31, 2012 in Nashville , Tourism | Permalink


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