MOVIES/MUSIC

Studio lease worries some in music, film industries

City Council set to vote on sublease of Austin Studios space to Nashville group.

By Michael Corcoran
AMERICAN-STATESMAN STAFF
Thursday, August 27, 2009

Soundcheck Nashville owner Ben Jumper expected open arms when he decided to expand his revered music rehearsal business to Austin this year. Instead, he found some members of the local film and music communities up in arms.

"We're coming to Austin one way or another," said Jumper, 52, who bought Soundcheck Nashville from Glenn Frey of the Eagles in 2004. But whether the new location will be at the Austin Studios film complex, which recently completed negotiations on a long-term lease with Soundcheck, or elsewhere, is up to the City Council. The vote on whether to approve the lease on the city-owned property is on today's council agenda.

Opposition comes from two sides — local music business owners who say the Nashville company will be given an unfair advantage on city property, and some in the local film industry who, in the aftermath of film incentives signed into law in May, don't want to see 28,000 square feet of Austin Studios' 100,000 square feet of total production space taken out of play. They don't want to see Stage 4 rented to a business best known for providing band rehearsal space and renting sound equipment.

"We thought we were at the tail end of a long negotiation process," said Jumper, who approached Austin Studios, which is operated by the nonprofit Austin Film Society, in October 2008. "It's been kind of disheartening."

Unfair advantage?

Danny Cabela of Music Lab, which offers the same sort of services as Soundcheck Nashville, said he's not against the competition, but he says Soundcheck doesn't qualify to be a tenant at Austin Studios, which pays no property taxes because it's on 20 acres of city-owned land at the site of the former Mueller airport.

"I voted for Proposition 4 because it was all about helping the film business grow," Cabela said of the 2006 bond that earmarked $5 million for soundproofing, insulation and air conditioning of Stage 3 and Stage 5 at Austin Studios. "There was nothing in (Proposition 4) about renting to a music business."

Austin Studios executive director Rebecca Campbell would not say how much rent Jumper's company — which would be known locally as Soundcheck Austin — would pay, except that "the range is 51 to 85 cents per square foot, per month," Campbell said. "Soundcheck's rent falls in that bracket." At the lowest end of that spectrum, Soundcheck would pay $14,280 a month.

In response to an information request filed by the American-Statesman under the Texas Public Information Act, the city declined to say how much Soundcheck is paying for the lease. Melissa Alvarado of the city's Economic Growth and Redevelopment Service Office said that "the information was deemed proprietary by the Austin Film Society" so the city has forwarded the information request to the Texas attorney general's office, which can take up to 45 days to issue an opinion.

The sublease stipulates that Soundcheck Austin would spend at least $500,000 for improvements at Stage 4, with Austin Studios kicking in up to $475,000, which it received as a loan from a charitable foundation.

"This is not a sweetheart deal," Jumper said. "The only financial advantage is no property tax. We figured out that, at a standard rate of $1.15 per square foot, our property taxes would be about $30,000 a year. And I'm putting $500,000 in cash into improvements that the city owns. How's that a sweetheart deal?"

There are five converted aircraft hangars at Austin Studios, which pays the city $100 a year in rent. Austin Studios began operations in 2000 as a city economic development project to bring more film dollars to Austin. A 32-year-lease extension, approved by the council in June, adds the adjoining National Guard Armory to the Austin Studios complex in 2012.

According to the lease, "the premises shall be used only as a studio complex for the production of films, television programs, commercials and multimedia productions ... " as well as "other accessory uses associated with such productions," giving sound stages as an example.

"The wording in the lease couldn't have been more clear," said film producer Paul Alvarado-Dykstra, who worked on "Secondhand Lions," which was filmed at Austin Studios in 2003. "It's for film, period."

Jumper said his business is in compliance with the use of premises clause because of the convergence of music and film during the current digital revolution. His plans for Soundcheck Austin include video filming of live performance rehearsals, live scoring of films and music video shoots.

Jumper also will be a back line (sound system and instrument rental) provider for the South by Southwest Music Festival.

Soundcheck's specialty is staging full production tour rehearsals for major touring acts. Soundcheck Nashville is also the headquarters for Crew One, which staffs technical workers and stagehands for live events.

Calls for openness

According to the deal with Austin Studios, Soundcheck could have as many as eight tenants of its own, but they must fall under the parameters of the sublease, which limits use of the premises to "digital media and multi-media productions and related support services ..." Jumper said that some of the offices would be rented to music equipment manufacturers to demonstrate their products but that there would be no retail sales.

The sublease is for five years, followed by two five-year options. But other pertinent terms of the agreement, such as how much rent Soundcheck will be paying the nonprofit, have not been made public.

"There should be more openness about a sublease for a space on city land," said Cabela, who has allies in studio owner Stuart Sullivan of Wire Recording and instrument retailers Robert Strait of Strait Music and Ray Hennig of Heart of Texas Music.

Ray Benson of the band Asleep At the Wheel, who also owns Bismeaux recording studio, has known Jumper since the days Jumper headed security for Charlie Daniels from 1976 to 1980. "He's a great guy, super-professional," said Benson, who backs the move to Austin Studios, even though the capability for bands to record at Soundcheck could cut into his business. "That infrastructure is needed to keep people here. Sure, it's competition — for me, too — but it's welcome competition."

No turning back

Jumper and his wife are shopping for a condo in town, and he said, after two years of scouting Austin, there's no turning back.

The movie business is down all over, and during the past two years, Austin Studios spent more money on staff, utilities and upkeep than it brought in. The passage of House Bill 873, which entices film and television productions to Texas with incentive payments up to 15 percent, should help.

"Why reduce the potential film footprint now — just when the tax incentive for film making in Texas has passed?" producer Nan Bernstein of "Friday Night Lights" wrote in an e-mail to the City Council last week. "Friday Night Lights" shot part of its pilot at Austin Studios, but Bernstein said there was no space available in 2005, when the series was picked up. "Friday Night Lights" occupies 40,000 square feet of office and pre-production space on Burleson Road.

Campbell said that space won't be a problem when the National Guard building, with 61,500 square feet of office and 18,000 square feet of production space, becomes available.

"I'm not sure what the controversy is all about," said documentary filmmaker Paul Stekler, who teaches at the University of Texas and is on the Austin Film Society advisory board.

"The whole deal of filmmaking as entertainment has changed. It's not just movie theaters anymore. There's synergy with music and interactive and video games. This (deal with Soundcheck) makes sense and keeps the Studios financially viable."

mcorcoran@statesman.com; 445-3652