ATL/BTL Breakout

Defining the “Line”

The concept of ‘Above the Line’ (ATL) and ‘Below the Line’ (BTL) is the fundamental organizational principle of any professional film budget. The term originated in the early studio system, where a top sheet of a budget would literally have a line drawn on it. Above this line were the individuals considered to have the most significant creative and financial influence on the project, whose compensation was often negotiated before the project was even greenlit. Below the line was everything and everyone else required for the physical execution of the film. The ‘breakout’ is the detailed document or report that shows this separation and lists the costs within each category.

Above the Line (ATL) Costs

ATL costs represent the creative and intellectual property elements of a film. These are typically arranged and secured during the development phase and are often considered the most variable and heavily negotiated part of the budget. If a production needs to reduce its budget, it is often easier to make cuts BTL than to renegotiate a star’s fixed salary.

The primary ATL categories include:

• Story and Script: The cost of acquiring the rights to an underlying property (like a novel or play) or the fee paid to the screenwriter(s).
• Producers: The salaries and fees for the credited producers, executive producers, and associate producers.
• Director: The director’s fee.
• Principal Cast: The salaries for the main, recognizable actors in the film.

These costs are often ‘package’ deals, where a star, director, and producer might be represented by the same talent agency.

Below the Line (BTL) Costs

BTL costs encompass all of the practical, logistical, and technical expenses needed to actually make the movie. This category represents the vast majority of the crew and physical assets. BTL expenses are generally more standardized and can be budgeted with greater accuracy based on union scale rates, equipment rental catalogs, and other fixed costs.

Major BTL departments and costs include:

• Production Crew: Everyone from the Director of Photography and Production Designer to the grips, electricians, hair and makeup artists, and production assistants.
• Camera and Sound: The cost of renting cameras, lenses, lighting packages, and sound recording equipment.
• Art Department: All costs associated with production design, including set construction, props, and set dressing.
• Wardrobe: Costumes, from creation to rental.
• Locations: Fees for renting and managing shooting locations.
• Post-Production: The salaries for editors, sound designers, colorists, and visual effects artists, as well as the costs for facility rentals.
• Insurance, Legal, and Contingency: Includes production insurance, legal fees, and a contingency fund (typically 10% of the BTL budget) to cover unforeseen expenses.

Why the Distinction Matters

Separating the budget this way is critical for several reasons. For financiers and investors, the ATL costs indicate the ‘attachments’ and perceived commercial value of the project, while BTL costs represent the fixed cost of production. For producers, it provides a clear framework for managing the film. The BTL budget is the direct responsibility of the Unit Production Manager (UPM) and their team to manage on a day-to-day basis.

Perhaps most importantly, the distinction is crucial for film tax incentives. Many states and countries offer tax credits or rebates to productions to encourage them to film in their jurisdiction. These incentives are almost always calculated based on the ‘qualified,’ in-state BTL expenditures (i.e., money spent on local labor, services, and rentals), while the salaries of high-earning ATL talent are often excluded or capped. This makes the ATL/BTL breakout an essential tool for film financing strategy.