Written By Katherine Yung, LivingstonDaily.Com

Measure would preserve movie money
May 16, 2011 |

Written by
Katherine Yung
GANNETT NEWS SERVICE

In a bid to keep Michigan's film industry thriving, two state senators have introduced a bill to preserve tax credits for filmmaking in the state.

Senate Bill 383 was introduced Thursday by Sens. Mike Kowall, R-White Lake Township, and Virgil Smith, D-Detroit.

Kowall, chairman of the Senate Economic Development Committee, acknowledged that winning support for it is "going to be tough," but "I've got a good feeling about it."

Even though the Legislature voted to eliminate the credits as part of a tax-reform package passed Thursday, Senate Bill 383 could restore some incentives for the industry.

The bill, which attempts to modify the current incentives, is subject to changes during upcoming budget negotiations.

It would allow the state to award filmmakers tax credits of up to 42 percent for their production expenditures, instead of an absolute 40 percent or 42 percent.

Michael Finney, CEO of the Michigan Economic Development Corp., said that under these terms, he expects the state's film tax credits would vary from 10 percent
to 30 percent. The number would vary depending on the state's negotiations with each production company.

Kowall said he consulted with MEDC officials on the bill.

Finney also said the state would like to make TV commercials eligible for the incentives for the first time.

He spoke during a public hearing about the film incentives held Friday by the Senate Economic Development Committee at the new $80 million Raleigh Michigan Studios in Pontiac.

Kowall said his bill would limit the amount of money the state could spend on film incentives. But what form any cap would take is unclear.

In mid-February, Gov. Rick Snyder proposed putting a $25 million cap on spending for the incentives, which are currently uncapped and are among the most highly generous in the nation.

The movie industry opposes this limit, saying it will sharply curtail filming.

It has been lobbying for a $180 million cap.

The Friday hearing was the first of several that Kowall's committee plans to hold. The next one is set for Wednesday in Lansing.

At the hearing, Raleigh Michigan Studios executives confirmed for the first time that the Disney production, "Oz: The Great and Powerful," will be the first feature film to use the studio's seven sound stages. Filming on the Sam Raimi-directed picture is to begin in August and continue through the rest of the year.

"Oz," which received a $40 million tax credit last year, will be the largest movie to film in Michigan and is expected to spend $105 million in the state. The movie is a prequel to "The Wizard of Oz."

The filmmaking incentives have brought several productions, including "High School," "Conviction" and "The Wannabes Starring Savvy," to Livingston County.