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Saturday, April 2, 2011

Truth About the Michigan Film Incentives

Governor Snyder’s and the other politicians attack on the Michigan’s Film Incentive Program has already cost the state millions of dollars and uncountable number of jobs. They claim the incentive program drains money from the state, while giving very little back. Not only do the independent studies prove this wrong, but so does common sense.

The Incentive Program returns 36-42% of what the Production Company spends within Michigan. . Independent accounting firms proved that the film industry spent over 600 million dollars of new money in the state of Michigan. The incentive program for the same period of time paid out a 100 million. However, the key phase is “new money.” Money that would have been spent in another state came to Michigan. Taxes that would have been paid to another state were paid to Michigan. The same could be said for jobs, fees, and positive promotions, which gave the state international exposure not only to film fans, but also to foreign investors who were looking for a new market.

The film and television industry is very fluid. Unlike manufacturing, retail, or most businesses, it doesn’t need to build a large infrastructure to in order to do business. It is capable of using existing structures as locations by temporary modifying them to meet their needs or by using larger spaces to create short-term sets. In doing so it pays location fees to cities, businesses, and individuals. It hires locally for services and products. In addition, to the union staff, it hires local people to play extras and to work non-union positions, thereby opening the door to new careers both in front of and behind the cameras.

If however, a production company decides to set down roots by establishing a studio, they bring with them not only the gypsy jobs of cast and crew, but also hundreds of support jobs. Whether it be in the office, transportation, promotions, catering, maintenance, or security, nearly every studio hires its support staff locally.

Studios not only bring in film work, but it opens the door for other projects such as commercials, music videos, video games, and television series. All of which increases the demand for local services and staff, while increasing the individual and business tax base. Whether the income is local, national, or international, studios also pays taxes on their profits to their home state.

When people have good paying jobs the demand on pubic social service lessons. Instead of being a drain on the state, they not only pay taxes, but they also have the money to pay for goods and services, which in turn creates new jobs and tax revenue. This positive financial cycle financially benefits the state.

With this win-win financial scenario why would Snyder and other politicians attack a program that is bringing new money and jobs into the state. It is very simple. New money and good jobs challenges the status quo. Established businesses do not want to compete for good employees by having to pay a living wage and benefits. In addition, Snyder and his old boys club are out to break the back of the unions. Unions fight for workers to have safe working conditions, a living wage and benefits. They take away greedy CEO’s power to use, abuse and lose employees at will. Collective bargaining strengthens the work force, which in turn strengthens the state’s economy.

If Snyder’s changes to the Film Incentive program are allowed to stand, not only will it cost Michigan hundreds of millions of dollars and thousands of jobs, but its reputation as well. The industry was given five years to become self sustaining and profitable. Snyder is trying to change the terms after two. The bait and switch has not gone unnoticed by the rest of the country and the world. No Corporation or individual will invest long term in a state, which is not as good as its word.

It is time to tell Governor Snyder and those who stand with him keep their hands off the Film Incentive Program. In order for Michigan to regain prosperity, it needs new jobs that come from new money. It also needs to reestablish its reputation as a state, which stands behind its word. As citizens, it is time to remind the elected politicians that they work for us, not the Corporate CEOs by calling and demanding that the film incentives be preserved.

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