New bill will wipe out tens of millions of dollars paid out in film incentives

Posted at 11:30 PM, Jun 18, 2015
and last updated 2015-06-18 23:30:11-04

GRAND RAPIDS, Mich.—The bill to wipe out the tens of millions of dollars in state film incentives is sitting on Governor Snyder’s desk. The senate voted to end the tax kickback for the film industry Wednesday. The film incentives would end next year, and would phase out the state’s film office altogether by the end of 2018. It would be the final ‘death blow’ to a program that was once considered a crown jewel of the Granholm administration.

“We are talking about literally dropping millions of dollars into West Michigan," said Rick Hert, commissioner of the West Michigan Film Office, "and that could all blow away in the next few days. And that’s very concerning.”

We’ve seen the stars in Michigan, from 50 Cent and Val Kilmer in “Gun” to Jesse Eisenberg in “30 Minutes or Less."  In Detroit, Clint Eastwood filmed “Gran Torino.”

Blockbuster filmmakers like Zach Snyder say film incentives attracted them to the mitten, but the new bill will change that. It would remove all film incentives starting in 2016 and eventually phase out the film office completely.

Rick Hert, commissioner of the West Michigan Film Office, said it’s a bad move.

“They are saying we don't generate enough taxes coming back to the state government, but you've got to look at the number of vendors and crew and impact," said Hert. "We do give "Batman v. Superman" $35 million, but they dropped $131 million into our economy. It’s significant.”

Tricia Kinley of Michigan Chamber of Commerce said the state doesn't have much to show for the tens of millions of dollars in incentives over the last seven years.

“The reality is the program actually rewards out-of-state Hollywood moguls at the expense of Michigan workers," Kinley said, "and we just think it's time to get rid of this program. There are so many better ways to redirect and use those precious tax dollars.”

Oscar-nominated director Rob Reiner, who directed box office hits like the “Princess Bride,” “Stand By Me,” and "This is Spinal Tap," also directed a movie in Michigan in 2010 called "Flipped.”

“At that time in Michigan, you could get a 40 percent rebate for any money you spent below the line.”

Reiner said an affordable location is always a top priority when filming a movie. “That will affect peoples' decisions, you know, film maker's decisions, because, if they don't think they can get a tax break in a particular place, they are going to go somewhere else.”

Reiner tries use local businesses and crews as much as possible. “You do not have to house them, fly them in, and the costs are way lower.”

Hert said movies generate money for Michigan, and failing to stay competitive with other states is going to give a black eye to Michigan.

“I do this for only one reason: for jobs and economic development. I try to make that connection with our local vendors for the film industry. I want to make sure they spend as much of their money here as possible.”

The Michigan Chamber of Commerce says there are no measurements that show feature films in Michigan are putting the state on the map or benefitting tax payers.

“It’s not the Hollywood movies that might feature Michigan,” said Kinley. "But keep in mind a lot of those Hollywood movies might be filmed in Michigan, but they are filmed in a giant studio that never show the beautiful backdrops."

The film folks said that cutting incentives will also hurt restaurants, hotels, and other businesses that benefit from productions coming to the town.

“There are two types of figures,” said Hert. "There’s ones that look at the impact, and we have shown for every dollar we spend there are six dollars that come back into our economy. Tourism does the same thing, so the impact is significant. But what they do for film is they look at it as what kind of taxes does it generate? If you put that same metric with others that would make a difference as well."

Now the objective is to let the film office to continue to assist people who hold current contracts, instead of just ending the operations., but it would diminish over the next three years.