From Keely Baribeau in Michigan

Keely Baribeau: Film tax credits aid state economy; why end them?
Apr 20, 2011 |

The Michigan Film Tax Incentive is one of the best programs the state has. Naysayers bash it as padding Hollywood pockets. They say it doesn't generate tax revenue. Let's just say they don't see the big picture.

With any developing enterprise, the incentive program has flaws. They pale in comparison, however, to the profitable potential this industry holds for Michigan. Designed to bring jobs, the film tax credit has done just that -- maintaining employed residents in temporary and full-time positions.

Anyone who attends the Blue Water Film Festival in October can hear first-hand stories of people who have benefitted. Beyond filmmakers, people have flourished in catering, transportation, restaurants, farming carpentry and security. Even local actors benefit. These are Michigan residents buying goods and services and, yes, paying taxes.

To receive Michigan's nation-leading tax return of up to 42%, a film company must spend more than $50,000 in the state. At least 40% of the crew must be Michigan residents. With an increase in filmmaking activity, more infrastructure is created and more Michigan residents are hired.

This results in the state retaining more people to work in and service this creative, thriving and developing industry. Instead of the negative perspective of "giving away" 40%, let's cheer the 60% Michigan gains. The 40% credit per approved project was not intended to be balanced on tax revenue from the film companies alone.

Beyond the criticism, where is the innovative solution? With Michigan's hard-hit economy, why ruin one of the only new things attracting people to move and work here? Under the guidance of the tax credit's plan, local entrepreneurs have developed studios, post-production facilities and training programs for a Michigan work force.

When it's fulfilled, this plan will reduce the need to bring in crews from out of state and establish a fully operational local industry. Retaining this population creates an increase in home values, taxes, school funding, tourism and local business and service spending.

Setting a $25 million cap on the incentives is not a strategy for success. Just ask other states such as Mississippi, which experienced "economic fallout" according to news sources when its fledging film industry chose to make the same move. Even the mention of cutting the incentive caused several companies to take their business elsewhere.

These are business people in a competitive market. Name another industry that doesn't want to produce in the best possible business environment. Michigan already has become that environment for several major companies with the film incentive, and it needs to stay that way.

The $25 million cap is not enough to attract multiple big budget, high-spending movie productions. Let's finish the intended vision for the tax credits and set a permanent foundation for filmmaking before pulling the plug.

This is Michigan's moment in the spotlight. The collective morale, pride and enthusiasm of seeing Detroit in the Super Bowl with the Eminem/Chrysler ad spot was just a taste of the potential. Michigan's communities --including ours -- should be competing for filmmaking business, not supporting those who want to decrease or end this success.

I encourage everyone to attend the Blue Water Film Festival this fall. Talk to people who are making a difference and putting Michigan in the director's chair. Support the Michigan Film Tax Incentive.

»Keely Baribeau is a member of the Blue Water Film Festival Board of Directors.