Boxoffice-March.24.1956

BRANDT, DISSENTING, URGES
LOAN PLAN FOR THEATREMEN
ITO Head Opposes Allied
Views on Controls, He
Tells Senator Group
WASHINGTON—Harry Brandt, president
of ITO of New York, appeared as the
dissenter before the Senate Committee
hearing exhibitor complaints Thursday 1 22 |
to oppose Allied and TOA views on arbitration
and government relief for theatremen.
He was on the stand for more than two
hours during which, in addition to lambasting
Allied and A. P. Myers in particular,
he urged elimination of the 10 per cent
admissions tax and giving financial assistance
to marginal exhibitors via a loan plan
as a two-way plan to help theatremen.
Both Sen. Hubert Humphrey and Sen.
Wayne Morse commented on his "forthrightness"
in presenting a "conflicting point of
view."
PLEAS FOR TAX ELIMINATION
Brandt spent more than an hour detailing
the steps which he maintains Allied has taken
to injure the exhibitors' interests. Most of his
testimony, which he had printed in a booklet
in advance, was dedicated to history, as his
group interprets it.
He disputed the statements of several exhibitors
who testified Wednesday (21) and
particularly that TOA and Allied "represent
95 per cent of the industry."
His conclusions are as follows:
"We have spoken of our opposition to regulatory
legislation, to which we are vigorously
opposed. However, there are areas of remedial
legislation that can be recommended by this
Committee which will be of inestimable
value to independent exhibition. The report
of Aug. 8, 1953, of the Senate Small Business
Committee, called the industry 'sick.'
"The industry needs additional relief and
it is our hope that this Committee will make
a recommendation to Congress as its predecessor
did for total elimination of the tax as
the most important means of alleviating
the problems of the independent exhibitor.
"According to reliable statistics gathered
for the Council of Motion Picture Organizations,
the average weekly motion picture attendance
was 45,800,000, a drop of 6.9 per cent
from 1954's weekly average of 49,200,000. In
the peak year of 1946, weekly attendance
averaged 82,300.000. The average weekly attendance
for the fourth quarter of 1955
dropped 15.2 per cent from the same quarter
in 1954, the greatest decline since the compilation
of statistics began in 1946."
DECRIES LOSS TO COMMUNITY
Brandt then presented considerable of the
statistical data which COMPO has prepared
for its tax campaign, showing the number of
theatres operating in the red, and what the
loss of a theatre means to a neighborhood or
a small town.
"The economic loss of wholesale theatre
closings far outweigh the revenues obtained
from admission taxes, for the loss is borne
not only by the theatre operator but by his
AB-PT, Western Union in
Electronics Deal
Dr. Frederick C. Henriques, president of Technical Operations, Inc., receives
two checks for $276,714 each from Leonard H. Goldenson, president of American Broadcasting-Paramount
Theatres, Inc., and Walter P. Marshall, Western Union president,
for 22 per cent stock interest (92,238 shares) in Technical Operations, Inc., of Arlington,
Mass., a nucelonics and electronics firm engaged in a broad range of scientific work
with emphasis on the applications of nucelonics, operations research, chemistry, physics,
and electronics to industry and government uses. Both companies have options to increase
their individual stock interest up to 25 per cent.
employes, all firms and services with which
he does business and by the community in
which he operates," he said. "Neighboring
merchants are particularly hard hit because
they depend to a large extent on the patronage
of persons attracted to the theatre. Real
estate values around a closed theatre invariably
decline. Franchise and license fees are
lost and more persons are added to the unemployment
rolls.
"So, while the government would appear to
sustain a net loss of $48,000,000 if federal admission
taxes were eliminated, it could conceivably
sustain a much greater loss by keeping
present taxes in effect and forcing wholesale
theatre closures. The record shows that
prior to partial tax relief in 1954, theatre
closings averaged eight per day. After tax
relief, theatre closings were more than offset
by theatre openings. Were it not for that
relief, there is no doubt additional thousands
of exhibitors would be out of business. There
is no doubt that the industry needs further
relief in the form of complete repeal. We urge
this Committee to come forward with such
a recommendation."
He then made several recommendations.
"We would be remiss in our presentation
not to further point out that this Committee
can recommend other legislation of great
value which does not encompass regulation.
During the past few years, owners and operators
of theatres not forced to close have
found themselves in a position where their
working capital has become badly depleted.
One of the primary reasons for this condition
is the lack of availability of mortgage
funds for motion picture theatres. Under
presently existing conditions, motion picture
theatres are not regarded as good financial
risks by banks, insurance companies and other
lending institutions. Small theatre owners
have been finding it increasingly difficult to
obtain loans with which to refurbish theatres,
to purchase new equipment and to supply
much needed working capital for other operating
purposes.
"In conclusion, we urge the Committee to
make a finding urging the Department of
Justice to permit the former affiliated circuits
to engage in film production and to invest
funds in film production.
"We again urge the Small Business Committee
to renew the recommendation of its
1953 report to the effect that responsible
elements proceed with the establishment of
an industry wide system of arbitration,
without a provision for the arbitration of film
rentals, which should do much to expeditiously
minimize trade disputes and set a pattern
for intra-industry harmony.
"And finally, we urge the Committee to find
that any efforts by a group of independent
exhibitor representatives to resort to government
regulation of industry film rentals
would be most unwise and inimical to the
best interests of the industry in general and
independent exhibitors in particular."
BOXOFFICE :
: March
24, 1956 27