Lights ... camera ... hold it! What do the film incentives mean for the rest of Michigan?

Author:Williams, Brad
Position:VOTE4BIZ
 
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In 1999, two different young producers released projects that centered on teenagers in Michigan. "American Pie" was the surprise hit of the summer and was based on high school seniors from East Great Falls (E. Grand Rapids), Michigan. "Freaks and Geeks," was a one season wonder for NBC set in Macomb Country, which has since become a cult classic and launched the impressive career of Producer Judd Apatow (Superbad, Anchorman). The sad fact of both of these productions is that not one dollar was spent in Michigan to produce them.

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It is productions like these and the desire to attract the film industry in Michigan in general that led the Legislature to pass the most generous package of incentives in the entire nation to woo the film industry. Film makers are eligible to claim a refundable credit against the new Michigan Business Tax for up to 42 percent of eligible production costs, which generally include most in-state investments. To put that in perspective, this year's blockbuster "Indiana Jones and the Kingdom of the Crystal Skull," with a $185 million budget, could have been eligible for a credit of up to $77.7 million. The key is that the credit is refundable, so the state would actually have been writing a sizable check to Steven Spielberg and George Lucas in order to get them in the state.

If success is measured by the number of scripts that have been submitted to the Michigan Film Office for consideration, the program is an unquestionable success, So far this year, the Michigan Film Office has gotten 44 applications for the program and approved 21 of them. This is an increase from a half-dozen last year.

Proponents of the incentives point out that with the economy struggling, it is important to diversify the economy. Also, while the upfront costs might be high (current estimates point to a price tag of well over $10 million in rebates in year one), the incentives can lead to vital investment in the infrastructure of movie making such as studios and soundstages.

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