That sounds expensive. How is the contribution due the FMSMF calculated? What else should I know about the FMSMF?
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- Bruce Howard
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2 The Film Musicians Secondary Markets Fund is a notfor-profit organization that works in association with the American Federation of Musicians (AFM) and the Alliance of Motion Picture and Television Producers (AMPTP) to ensure the collection, processing and payment of residuals to qualifying musicians who have performed music used in films and television. FILM MUSICIANS: Members of the American Federation of Musicians: the world s best musicians, helping create the world s best scores. SECONDARY MARKETS: The FMSMF covers ONLY the Secondary Markets and NEVER any Primary Markets never from domestic or foreign box office. FUND: Operates similarly to a not-for-profit with virtually all of the residual payments collected being disbursed to the musicians who help create music for film and television. WHICH MOTION PICTURE AND TELEVISION SERIES/FILMS QUALIFY FOR PAYMENT TO THE FUND? In order to be covered, the title must meet the following 3 conditions: 1. At least one original scoring or sideline session must be filed with the AFM. 2. The work must be done for a signatory employer. 3. A theatrical production (a film initially released in theaters), must have been produced after Jan. 31 st, 1960, a television series/film after July 1 st, 1971.
3 You ve Got Questions We ve Got Answers How does the Film Musicians Secondary Markets Fund assist the American Federation of Musicians and also assist producers (from the studios to the smallest independents? The AFM, including Local 47 here in L.A., is home to some of the most talented studio musicians in the world. When a film moves into the secondary markets and pays into the FMSMF, the FMSMF processes all the paperwork for every musician regarding payroll taxes and benefits and makes certain the musicians receive their residuals. A producer pays with one check to the FMSMF and everything is handled from there. That sounds expensive. How is the contribution due the FMSMF calculated? When a film is scored using members of the AFM, a producer has taken a giant step toward making his/her movie more desirable. For this privilege, the producer owes (generally) 1% of the Producer s Gross BUT only from supplemental markets revenue, NOT from Primary markets (domestic or foreign box office). For example, a film that makes $100,000 in DVD sales would owe the FMSMF a mere $1000. What else should I know about the FMSMF? All residual contributions are made before income taxes are paid on revenue, thus reducing IRS obligation. Also by executing a Buyer/Distribution Assumption Agreement, a producer can transfer and/or terminate residual obligations, as is routinely done with DGA and SAG. When do contributions to the FMSMF begin? Contributions to the FMSMF are to begin on or before 60 days after the end of a calendar quarter in which those payments were accrued.
4 Some examples: A 2010 low budget film with a domestic box office gross of $38 million, foreign box office of $7 million none of which resulted in any payments to the Fund has contributed a cumulative total of $301,000 to the Fund, but only as a result of pay TV, free TV and substantial DVD revenues. A 2010 thriller feature generated a domestic box office of $13 million and foreign box office of $4 million and has contributed a cumulative total of $194, to the Fund. A major studio 2010 international action feature with a domestic box office gross of $176 million and foreign box office of $182 million, plus millions more in DVD and TV sales has yielded contributions to the Fund of $664, A 2009 indie low budget release with a domestic box office of $5 million has yielded contributions to the Fund of $47,434 to date.
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