News Story

YouTubes Praising Special Tax Breaks for Filmmakers Getting Yanked

It may be political expediency or just coincidental timing, but videos discussing Michigan government's controversial programs that give special tax breaks for filmmakers didn't have much of a shelf life on YouTube last week.

One video is of former state Rep. Bill Huizenga, R-Zeeland, and features him giving a favorable and detailed explanation of how the Michigan Film Office's tax credit program for filmmakers works. It was yanked down late last week.

The other video took its place in an ongoing controversy surrounding the Hangar 42 movie studio near Grand Rapids, the Michigan Film Office, and a questionable land deal related to the studio. The video featured a legislative aid to a Michigan state representative. This video was also taken down by its creator - whose name matches that of the aid - and the aid later resigned.

The video featuring Huizenga was posted by the Compass Film Academy.

Jim Barry, a spokesman for Huizenga's campaign, said Huizenga had no knowledge of why the video of the former lawmaker was taken down from the Compass web site last week. Barry said Huizenga still supported the film tax credits but that the program would benefit from more transparency.

As a state representative, Huizenga was one of the main supporters of the film tax credit program that is promoted by the Michigan Film Office. He is now one of several candidates hoping to replace Congressman Pete Hoekstra, R-Holland, in the U.S. House of Representatives.

Evan Koons, an industry relations specialist for Compass Film Academy, said the video was no longer available and that Huizenga didn't request it be taken down. Koons wrote in an e-mail: "We're currently revamping our online video presence and working to update our marketing materials for Fall 2010."

An identical copy of the Huizenga video resurfaced Friday on another YouTube page, by a user named "zeelandchick," with the title "Bill Huizenga's Michigan Film Incentives."

Zeelandchick provides the following caption to the reposted video:

Bill Huizenga talks about the Michigan Film Incentive that he helped pass into law in Michigan.

Over the next year, it is predicted that the Michigan Film Incentive will cost the tax payers of Michigan $150 million due to the 42% refundable tax rebates towards all film costs. The average length of job created by the Michigan Film Incentive is less than 30 days and costs far more in tax payer's money than it puts back into the Michigan Economy.

The Michigan Film Incentive is just another example of politicians trying to "pick winners and losers". This is not the proper role of government.

Zeelandchick also provides a hyperlink to a June 18 news release from Congressman Pete Hoekstra, wherein Hoekstra demands a "thorough investigation of the Michigan Film Office and MEDC process in awarding this $10 million tax credit to the Hangar 42 project."

Michigan Attorney General Mike Cox announced Friday that an investigation has begun.

The on-again, off-again, on-again, YouTube video regarding the Hangar 42 project was discovered by the Grand Rapids Press last week, pulled down by its creator, and then reposted by the newspaper.

Noah Seifullah, the chief of staff for state Rep. Robert Dean, D-Grand Rapids, was seen in this video explaining how to make millions in profits using the state's film infrastructure credits program, according to the Grand Rapids Press.

Seifullah resigned shortly after the Grand Rapids Press article was published.

Seifullah's description in his video is remarkably similar to the controversial Hangar 42 deal that is now under investigation by the Attorney General.

Hangar 42 Studio was involved in a land deal that involved a refundable infrastructure tax credit worth 25 percent of the investment in the project. The studio agreed to buy the facility for $40 million. It is located at the site of a former Lear Corp. manufacturing facility near Grand Rapids. But as late as February, the facility had been listed by a realtor for $9.8 million.

The question being raised is: Why would investors pay $40 million for a building that did not sell when listed for a quarter of that price?

In addition, contractors hired to help convert the property into a studio said they had not been paid and there were six liens outstanding. Since the Mackinac Center for Public Policy broke the story, several politicians have brought legislation looking to make the tax credit program more transparent.


(UPDATE 7/6/2010: Shortly after this article was posted, the video of Rep. Huizenga put up by "zeelandchick" was also taken down by YouTube. Then it was reposted on June 25 by a user named "Zeelandfirst" and yetanother copy was put up on July 6 by a user named "ThirdCoastPolitics." MichCapCon has saved a full copy of  this oft-deleted and controversial video and created an excerpted version of the section wherein Rep. Huizenga discusses the refundable nature of the film tax credits. This excerpted copy is now embedded above this article). 

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.