Michigan Film Industry: 'We’re Not Dead Yet, but We’re on Life Support'

If Gov. Rick Snyder’s budget proposal comes to fruition as was presented in mid-February, those at the helm of the Michigan film industry have dire predictions for the future.

“We’re not dead yet, but we’re on life support,” Jim Burnstein, vice chairman of the Michigan Film Office Advisory Council, said to a gathering of the  on Thursday morning at the chamber’s 2011 .

Speaking alongside Burnstein at the  on Thursday was Film Office Advisory Council Chairman Emery King as well as Jeffrey Spillman, the founder and managing partner of Ferndale-based S3 Entertainment Group. The mood was grim and the pronouncements dire, however all three panelists were confident as they urged Birmingham’s business community to fight for the incentives and the Michigan workers they benefit.

Michigan’s film incentives, adopted in 2008, provide a 42 percent refundable tax credit on all Michigan expenditures for filmmakers working in the state. Filmmakers must spent at least $50,000 and can claim an additional 2 percent credit if they film in certain communities. Michigan offers the largest such tax incentive in the nation.

In his proposed 2011-12 budget released Feb. 17, Snyder proposed capping the currently unlimited incentives at $25 million a year. According to the Michigan Film Office's 2010 annual report, 58 projects were shot in the state last year with $115 million in incentives awarded. In total, $294 milion was fed back into the economy and more than 5,000 production jobs were created.

“If you cap (the incentives), you will kill it. If you cap it at the amount they propose — we don’t have a chance,” Burnstein said.

Losing sight of goals

According to Burnstein, who helped craft the incentives as part of the Film Office Advisory Council, those behind the film incentives had three goals: to create jobs, reverse Michigan’s brain drain and create the infrastructure needed to support a thriving film industry.

On that third point, Spilman said the past few years have been productive. The Raleigh Studios are set to open this year in Pontiac and will be, according to Burnstein, “one of the top three studios in the world” once finished.

In addition, Burnstein — who also teaches screenwriting at the University of Michigan — said his students are finally deciding they want to stay in Michigan instead of moving to Los Angeles or New York after graduation. The tide, he said, is begining to turn.

Without the incentives, both of these successes are set to reserve themselves. Snyder’s proposal was “heard throughout the production world,” Spilman said, “changing the tenor of the conversation about the Michigan film industry.” The day after Snyder announced his plans, three film productions left the state, Spilman said.

“Our industry stopped that day,” Spilman said. “(Without the incentives), there’s no way we could support that infrastructure.”

Looking at the numbers, people involved

When it comes to determining the economic impact of the film incentives, Spilman said it’s all a matter of perspective. According to a recent report for Ernst and Young, for every dollar spent in tax incentives, $6 is generated in local revenue.

Burnstein pointed to Lousiana and Gov. Bobby Jindal’s plans to revitalize that state’s film industry as an example to follow. A 2007 study performed by the Republican governor determined that the $429 million spent on production incentives generated $763 million in economic impact since the credit was first offered in 2002.

“If it makes sense in Louisiana, why doesn’t it make sense in Michigan?” Burnstein asked.

In the end, all three agreed, maintaining the film incentives is less about the numbers than about protecting the thousands of Michigan residents working in the state’s film industry.

“This is about creating an indigenous film industry and diversifying our economy,” King said. “People are being trained to fill these jobs, so let’s not take away their hope.”

Chamber of Commerce President Joe Bauman said the Film Forecast Breakfast couldn't have come at a better time. Though the chamber planned the event months in advance, the film incentives are on more minds than usual. Besides Snyder's budget proposal, the premieres tonight at the and .