But filming a hit show in paradise comes with a high price tag, she said. And that is why Touchstone is talking with state officials about reducing costs if the show returns to O'ahu next season.

Today, legislators and film industry officials are meeting on the matter at the state Capitol. Negotiations have been under way between studio and state officials, after the show's budgetary issues raised concerns for "Lost" producers.

"We want to stay in Hawai'i, and we want to make it work," Gilmore said. "We recognize the state's part in our ratings success; everyone — the people, the state — have been incredibly helpful, supportive.

"I cannot imagine shooting in Canada, or in L.A., but it is more costly to do business in Hawai'i than Los Angeles. Our commitment is we want to stay. But we are a business. Show business. We have to look at the finances involved."

"Lost" episodes have been estimated to cost between $1.5 million and $2.5 million apiece. The show generates about 200 full- and part-time jobs, with more than 60 percent of workers coming from the local community, state officials said.

Harry V. Bring, a producer of Fox's Hawai'i-based series "North Shore," said industry talk circulated last year that "Lost," with its hefty cost per episode, might consider pulling up stakes here. "I heard rumblings midseason that they were contemplating shooting back in Los Angeles, doing second unit trips to Hawai'i," he said.

Reaction to the prospect that "Lost" would leave Hawai'i were mixed yesterday, with at least one observer characterizing demands for more tax breaks as blackmail.

"So if they leave, where will they go that will have the backdrop that they have here — that is still in the U.S.A. and that has not flooded or is freezing cold at the moment?" asked Lowell Kalapa, president of the nonprofit Tax Foundation of Hawai'i. "Remember, time is money in a production schedule.

"Funny how the request is coming in just as the Legislature is opening."

Still, the possibility of losing "Lost" has some state and city officials scrambling to boost the level of industry incentives aimed at reducing the costs of producing films and TV shows in Hawai'i. Among these is a bill pushed by Gov. Linda Lingle that would raise the 4 percent production tax credit to 15 percent on O'ahu and 20 percent on the Neighbor Islands.

The costs of the credits would be capped at $7 million a year per project, under a bill similar to one introduced last year that died in the waning hours of the session because of a lack of money.

Thanks to a healthy economy and strong tax collections, money is less of an issue this year. Whether the state needs to offer more money to land entertainment work remains an issue.

"Are there enough benefits such that the loss of 'Lost' is significant enough that it requires us to keep it here?" said Ted Liu, director for the Department of Business, Economic Development and Tourism. "If it is important, how much should taxpayers bear?"

Just how much the state provides "Lost" in the form of tax breaks is not available to the public. The TV series is claiming both the existing production tax credit and credits available under Act 215, which provides a 100 percent tax credit for qualifying technology and entertainment-related investments.

Donne Dawson, state film commissioner for the Hawai'i Film Office, said more comprehensive analysis of the costs versus benefits of film and TV incentives is under way, adding that raising the production tax credit should make the state more competitive with other U.S. and foreign locales.

"We have obvious competitors on the international scene and it's a lot more challenging for us to compete with them," she said. "We feel raising it up to that level will make us more competitive with those areas."

"Lost" is filming its 15th episode on O'ahu. The 22-episode first season ends production in April.

"The shows provide steady jobs; locals are getting some parts, with background actors called on a regular basis," said Brenda Ching, executive director of the Screen Actors Guild in Hawai'i. "A series simply provides steady work."