Riches-to-Rags Story Developing For Movie Operations in Michigan

House budget proposes eliminating state's $50M film subsidy program

If the state’s film subsidy were a movie itself, it likely would be a riches-to-rags story.

Just five years after the Michigan House of Representatives and Senate passed a bill by a combined 145-1 vote that gave huge subsidies to the movie industry, Republican state representatives are proposing to eliminate the film credit completely.

Nancy Cassis was a Republican state senator from Novi in 2008 and the only legislator to vote against the film subsidy.

"I think the mounting body of evidence that the economic return of using film credits is minuscule and actually a questionable subsidy to the movie industry led to the realization that such 'taxpayer giveaways' needed re-evaluation," Cassis said. "In Michigan's case, there is a pressing priority to improve our transportation infrastructure. Thus, the accountable effort to leverage tax dollars more responsibly."

Cassis said the publicity from a failed studio project in Allen Park as well as state public employee pensions having to bail out another studio in Pontiac by making its bond payments have led people to rethink the film tax giveaway. 

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"… the 'handwriting on the wall' became too overwhelming to ignore," she said.

The state gives approved production companies up to 35 percent incentive on qualified expenditures. The state awarded $93 million in tax credits in 2012, some for projects in production as far back as 2008.

Ari Adler, spokesman for House Republicans, said legislators are looking at all areas to find money for roads within already existing revenues.

"For now, one of those areas is the film incentives," Adler said. "I'm sure this issue will continue to be a focal point of budget negotiations as the process moves forward toward completion on June 1. Certainly, there is some work to be done by those who believe the film incentives should be increased to prove the overall value."

House Democrats asked that the budget for the state film office remain at $50 million.

"We consider the film incentives to be proven job creators in this state," said Katie Carey, spokeswoman for House Democrats. "Additionally, why are we getting rid of a program that has created jobs when Michigan still has an unemployment rate higher than the national average?"

State Rep. Tom McMillin, R-Rochester Hills, said a sign that the film credits were a bad deal is that both the Michigan Education Association and some tea party members oppose them.

"It is becoming more clear that these Hollywood film subsidies mainly send our Michigan taxpayer dollars out of the state to subsidize the salaries of millionaire actors and directors," Rep. McMillin said. "Those tax dollars come from the pockets of our citizens and businesses. If those dollars stay in their pockets, more people are employed in Michigan."


See also:

Five Reasons Government Subsidies For Films Are A Bad Idea

Hollywood Transforms Itself to Milk Multiple States For Movie Money

Public Employee Pension Systems Raided To Pay Film Studio Bills

Big Hollywood Bailout: Taxpayers Spent Nearly $40 Million To Subsidize Disney's 'Oz'

HBO Cancels Taxpayer-Supported 'Hung'

Hollywood Grinch: Michigan Taxpayers Give 'A Very Harold & Kumar Christmas' Millions

Should Michigan Taxpayers Have Been Forced To Spend $30 Million on 'Iron Man 3'?

New Transformers Flick Costs Each Michigan Taxpayer $1.36

Real Steel or Reel Steal? New Film Costs $4.26 Per Michigan Taxpayer

Michigan Film Subsidy Winner Costs 10x More to Make Than It Earns

Republican-led Legislature Votes Overwhelmingly to Continue 'Big Hollywood' Film Subsidy

Box Office Bombs: Made In Michigan

Related Articles:

Clock is Ticking on Michigan's Film Subsidies

Film Incentives Clearly Hurt

Mackinac Expert Talks Film Incentives on NPR

Poll Shows Overwhelming Support for Redirecting Film Subsidies to Roads

Michigan Film Incentives ‘All But Dead’

Skorup Film Subsidy Op-Ed Published in Wall Street Journal

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Participants in the 2016 Detroit Children's Business Fair show their grasp on how markets work. Featured are responses to the such thoughts as hoarding profit for personal gain, penalizing those who earn more and regulating private business.

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