Carrie LeZotte - Post 5: About This Tax Incentive...
Posted By: Carrie LeZotte
Posted: 9/2/2009
I was getting my hair cut the other day, and my stylist was talking to me about the tax incentive. He was telling me that he didn't see how it was supposed to benefit anyone but the producers, who would get checks from the state to go make their movies.
WHOA. Wait I minute, I practically jumped out of the chair! With all the coverage that the incentives have been getting, from the big movies coming into town to the debates in the legislature, I think everyone knows the 42% rebate number, but obviously, there are some things that need clarifying.
First, the production company has to pay for the production upfront. It has to spend the money here in Michigan (only 30% for non-resident hires who work here). Then it gets audited. Then, the company gets a rebate check. All of the details are available on the Michigan Film Office website.
The perception that only one person, or only a producer, benefits, is wrong. Usually there are several producers representing the production company on big movies who pull the project together, but, more importantly, it isn't just a select few who are benefiting.
It is possible for a production to get 42% of its budget back, but in order to get that kind of rebate, they have to spend, spend, spend, right here. There's a lot to say about this rebate, but I want to tell you how it's affecting the small businesses and freelancers who have been working in local productions.
Crew people I've worked with over the years are able to buy a house for the first time. Other peers who moved out of state to Los Angeles or New York for production opportunities are looking to move back to Michigan to work or start a business. Businesses that came close to closing are able to stay open.
I went through the rebate process with the documentary, Regional Roots, and with an animation pitch video, Daisy Tells a Secret. These projects were both budgeted at less than $100,000, and they aren't the big dollar productions that are shooting in your neighborhood. But those rebate dollars created jobs. We were able to hire and pay young talent who would have gone out of state. These small projects are helping our company grow in a way that will continue to keep jobs here in Michigan.
There has been a lot of talk about repealing the rebate or capping it, but what it needs is a chance to work. This takes time. Most of the dollars being spent here are coming from out of state and then the rebate goes back out of state. That just makes sense, because how many companies can drop tens of millions of dollars on production? We can't, not yet, but just give us a chance to grow, and someday we'll be able to finance those big budgets, as well as grow and nurture talent.
Michigan also needs time to build the studios and train people for these jobs. Building permanent facilities like additional production and post-production studios take time. It takes time to train and educate the people for those jobs and get everything up and running.
What we don't have, like forest fires caused by years of drought, can be really appealing for people looking to leave the west coast. With the loss of auto jobs in the region, we've needed something to bring new talent and energy back to Michigan. I'm so proud to be a member of this hardworking community, and I'm doing everything I can to help create jobs. Good things come to those who wait – and work for them.