New bills would bring back Michigan film incentives

Is it time to bring back film incentives to Michigan? Some legislators in Lansing think so and just introduced legislation to help make it happen.

The legislation would create a two-tiered tax credit that provides incentives for Michigan-produced commercials, as well as film, television and streaming productions.

“This is about Michigan jobs,” said Sen. Adam Hollier, D-Detroit. “As we witness the devastation and business losses from the pandemic, we know that attracting an industry that reinvented itself amid the crisis is a wise investment in our state’s economy and its workers.”

Hollier and Sen. Wayne Schmidt, R-Traverse City, along with Reps. Kyra Bolden, D-Southfield, and Jack O’Malley, R-Lake Ann, introduced the bills to create jobs and retain Michigan talent.

Senate Bills SB 862-863 are now on the way to the Senate Economic and Small Business Development Committee, while House Bills HB 5724-5725 will head to the House Commerce and Tourism Committee.

Brian Kelly, first chair of the Michigan Film Industry Association (MIFIA), has been leading the charge to bring incentives back for a few years and has been working with leaders in Lansing.

What’s being proposed is a far cry from 2008 when Michigan had the most lucrative incentives in the country. Hollywood types tripped over each other to take advantage of the up to 42% tax rebate on qualified expenses in Michigan when it started.

The incentives were a mega-success at drawing business but their cost to the state’s coffers became an issue as then-Gov. Rick Snyder ended them in 2015.

I’ve written much about films, incentives and Michigan as we watched them take off like a rocket and fizzle by 2015. Many folks — millennials, businesses — who benefited economically remain upset and continue to look for ways to bring something back.

Some movies, TV series and other production work remains but nowhere near 2008 levels.

Right now, 39 states offer some sort of film incentives. That Michigan does not puts it at a disadvantage.

This new effort is supported by lots of research into what other states are offering. “These 39 states offer film incentives and, in turn, receive the jobs, economic boost and related upstream, downstream and peripheral benefits from a multibillion-dollar industry,” said Kelly.

Kelly, an electrician, worked on a major film this summer in Cleveland (he could not reveal more as he signed a confidentiality agreement) that was drawn there by its incentives. “I was there for four months,” Kelly said. “The taxes, meals, gasoline and recreational income that was spent in their state, along with 20 other members of the Michigan film community also there, would have been much more beneficial if the opportunities were available in Michigan.”

Ohio is among four states MIFIA sees as its key competition: Pennsylvania, Georgia and Illinois are the others. “Those four states have been studied, distilled and localized for our upcoming competitive legislation to be one of the best programs in the country,” Kelly said.

This new legislation would help position Michigan as a more attractive location for film, commercials and growing streaming content.

“Bringing the film industry back to Michigan will create more jobs and boost Michigan’s economy,” said Bolden. “Michiganders will be proud when movies made about icons like Aretha Franklin and Motown can be made right here in Detroit.”

Among the bills' highlights: They give preference to state-based companies that hire Michigan residents. They also include:

A base tax credit starting at 25% for in-state spending with an additional 5% awarded for the inclusion of a “filmed in Michigan” logo.

A commitment from production companies to spend at least $50,000 for a single commercial campaign or project under 20 minutes or at least $300,000 for productions over 20 minutes.

A 30% tax credit for hiring Michigan residents and 20% for nonresidents.

A requirement that qualified Michigan vendors provide proof of brick-and-mortar presence, have inventory and full-time employees on staff.

“The incentives will provide direct economic benefits to Michigan communities,” said Schmidt.

Added O’Malley: "Film production is a manufacturing industry that depends on labor and a range of supporting goods and services to survive. This well-crafted and competitive film incentive program will attract new industry opportunities to our state and support Michigan's talent base and labor force."

No doubt there will be much more conversation about these bills, film incentives, helping Michigan’s economy and supporting our creative class, which is so needed in our state.