Hollywood of the North? Lawmakers mull film incentive

Michigan has moved one step closer to making a film tax credit program a reality.

State Rep. Robert Wittenberg, a longtime supporter of the area’s film industry, recently introduced House Bills 6504 and 6505 in the state House.

“I’m extremely excited but obviously skeptical,” said Brian Kelly, co-chair of the Michigan Film Industry Association (MiFIA) Board of Directors. “There will be a lot of people to sell this on.”

The legislation creates a twotiered tax credit that provides incentives for Michigan-produced commercials as well as film, television and streaming productions.

As a member of the film industry credited for his work in the camera and electrical department on such blockbuster films as “Batman v. Superman,” “Transformers: Age of Extinction” “Scream 4” and the “Ides of March,” Kelly said there is no reason why Michigan should not be competing with other states.

“Why can’t Michigan be competitve in the industry?” he said.

More than 30 states currently offer film incentives and, in turn, receive the jobs, economic boost and related upstream, downstream and peripheral benefits from a multi-billiondollar industry

“This is about Michigan jobs,” Wittenberg said in a statement following the announcement of the two bills. “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 smart investment in our state’s economy and its workers. This is a smart first step to rebuilding Michigan.”

As outlined in HBs 65046505, preference is given to state-based companies who hire Michigan residents.

Other specifics of the legislation 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 brickand-mortar presence, have inventory and full-time employees on staff. Passthrough companies and transactions will not qualify; and

• Accountability requirements for independent verification of approved expenditures.

Kelly said a cross-disciplinary team of Michigan film professionals from Macomb, Oakland and Wayne counties worked tirelessly with Wittenberg to come up with the legislation.

In the process – which has taken three years — the group studied four of the country’s most successful programs including those in Illinois, Ohio, Pennsylvania and Georgia.

“We took the best things from all of them but also worked out some of the kinks,” Kelly said.

That includes the problems associated with Michigan’s former film incentive program, which ended in 215, because of the financial burden that it placed on the state, among other things.

“The last package was a rebate system,” Kelly said. “You really can’t blame the state for not liking that. It was also too high at 42%.”

The new version is lower but in line with other states and, because of the way it is set up, this time will not take money directly from the state.

“This comes at a time when our state most needs good-paying jobs and an economic boost. We can no longer remain idle as film workers leave our state to follow an industry that can provide the stimulus Michigan needs.”

A new plan for the state is also good news for the industry said Kelly.

“This will be great for Ford and General Motors,” Kelly said.

Right now both are shooting a lot of their commercials in Georgia, California and New York but since the new plan includes commercials they might be inclined to do them here.

Studios such as Warner Bros. have also told Kelly they would definitely return to Michigan.

“They love coming here,” Kelly said.

Since Wittenberg was recently elected Oakland County Treasurer at the end of the 2019-20 legislative session on Dec. 31, if the bill is not signed into law, state Sen. Adam Hollier, D-Detroit, announced plans to reintroduce the legislation during the 202122 session.