Movie-making Good For the Economy!
By Dick Rolfe, CEO - The Dove
Everybody, at one time or other, has dreamt of being in
show business. Today, forty states are vying for the
opportunity to be in the movie-making business. Each one
is offering a wide menu of competitive incentives to
lure Hollywood producers into their state.
Michigan is one of the recent entries into this arena. A
little over a year ago, state lawmakers crafted one of
the most lucrative incentive packages in the country.
The Michigan Film Incentive offers up to a 42% return on
every qualifying dollar spent making a movie or
television show in the state.
Hollywood producer, Ralph Winter, a Dove Foundation
advisory board member recently interviewed with Michigan
Business Review reporter, Olivia Pulsinelli.
Winter’s comments are enlightening. They reflect the
thoughts and concerns shared by many filmmakers who
contemplate taking their “show business” out of
California to another locale. This interview is a
must-read for anyone affected by the current economy,
suffering from high unemployment and business losses.
Movie making could play a significant role in boosting
the economy of states that are willing to compete for
showbiz means understanding business
(an interview with Hollywood
Producer, Ralph Winter)
By Business Review reporter Olivia Pulsinelli
Former Michigan State Rep. Bill Huizenga
Producer, Ralph Winter
Producer Mark Clayman
Michigan's year-old film incentives
have sparked debate in the state -- but it's sparked
activity, as well.
What role do you think
Michigan could play in the film industry?
"I think that producers around the
world are looking for the best value for their money. So
where Michigan can fit the bill, I think people will
"One of the first things you try to
figure out when making your film (is) where am I going
to shoot, what are the locations I need, what are the
seasons I need, etc. Those things start to be the sort
of general qualifiers, and then from there, you start to
narrow it down, and you start to see where can I get the
best services, where is there an infrastructure, a crew,
soundstages and rebates. ...
"All of those things are attractive to
not just a Hollywood film producer, but any film
producer; because that's how you can get the maximum
impact for your dollar.
"So typically, when we budget a movie,
we try out three or four locations for the same shooting
schedule. You might take a 50-day shooting schedule and
say, 'OK, what's that going to cost me in Vancouver?
What's that going to cost me in Michigan? What's that
going to cost me in New Orleans?' You make choices on
those three locations based on what your story is. ...
"I don't want to be smart about it,
but in and around Detroit, do you have enough crew
there? That's sort of a depressed area that's fighting
unemployment. Is it safe there? Are there soundstages?
Is there crew available? Are there enough hotel rooms I
can put my crew up? Is there something for my crew to do
on the weekends? All that kind of stuff. Those kind of
very practical things.
"We feel like where we bring a large
movie, and we spent $20 (million), $50 million, there's
usually a multiplier of two to three times that amount,
because we buy lumber, we buy groceries, our crew buys
beer, we buy hotel rooms, we hire local crew, we rent
equipment, we rent cars. ... So it multiplies through
"Hopefully, you make it attractive for
people to come, and you get more of a benefit than the
rebate you're handing back over.
"The more you can measure (the
multiplier), the better off you're going to be, too. I
think then you've got a justification for continuing the
rebate or for justifying it to your legislature. And
testimonials from business people who've had a good
experience with it go a long way in saying, 'Yeah, let's
keep bringing in new business into Michigan because it
builds my business, it helps my profit line.'"
What do people in Hollywood or
others in the industry think of film incentives?
"We're upbeat on the incentives. I
think that, again, it has to be compared as a package.
... If you don't have any crew, you don't have any
soundstages, then I have to fly those people in -- it's
expensive, and it starts to offset the benefit of that
"You've got to look at the whole
package; you've got to look at all those things
together. How easy is it to get the rebate? Am I waiting
two years until I qualify and get all my marbles lined
up in a row? All those things play into it.
"And frankly, it's kind of the same
whether you're an independent filmmaker or a studio --
you're making the same kind of comparisons."
Is Michigan getting any kind
of attention in Hollywood?
"It's getting attention unfortunately
because of the auto market and how that is depressed,
and therefore maybe they want our business more.
"And you represent the middle of the
country, so you have that middle-of-the-country look, so
you've got to have a script that does that. If I have a
script that needs a desert or an ocean scene, I'm
probably not going to come here. Jungle? Probably not
"And some of it depends on budget. If
I was going to shoot 'Wolverine' here -- no pun intended
for University of Michigan -- I would have to have a
compelling reason, because I can find a neighborhood
that looks like Middle America in Vancouver. There I get
a tax incentive, and I get an exchange rate. So you have
to beat some of those incentives to actually attract
How well is Michigan promoting
itself to the film industry?
"I think Janet Lockwood (director of
the Michigan Film Office) is doing a good job on that.
"You've got 40 some other states
trying to do the same thing, so how do you make your
state stand out? ... Relationships with studios are
probably the quickest way to do that. And then just make
sure you're available and connecting with filmmakers who
would be thinking about or leaning toward being here in
"Again, remember it's a busy market,
there are a lot of people doing the same thing. New
Orleans and Boston and North Carolina and Vancouver are
just as anxious to get the studios' business as
A group of senators has
proposed capping the incentives, but others say even the
idea would deter filmmakers from coming here. What do
"Well, it's a little bit of a
deterrent because you don't know if you're going to fit
in (under the potential cap) ... and you need to plan
and do your location scouting four to six months in
front of shooting. Can somebody assure me 10 months out
that I'm going to qualify?
"I don't want to start down the path
of six months of preproduction and scouting and four
months of shooting only to find out that I've missed the
deadline or that now I'm not qualified under the cap.
Why would I take that chance? Why would I start down
that path? I might as well go someplace where there is
no cap or I know I'm going to get the incentive.
"I understand it's easy for me to say
that -- it's harder for the state legislature, because
they want to know how much are we really allocating to
this program. So I get that."
Winter suggested finding some way to
assure filmmakers they will qualify under a potential
cap if they meet certain milestones.
"It's basically about just wanting to
get the best return on your money. So you put yourself
in my shoes -- you try to figure out how do I spend the
least to get the most on screen? Because it's show
business -- you have to understand the business part."
Even if Michigan were to build
up a film-industry infrastructure, would it still always
need the incentives to bring films here?
"It's an interesting question. ... Are
you heading down a path that you can't turn back from?
And the answer to that I think is, ‘do you want to be in
the film business?’ I can shoot a movie anywhere -- I've
shot all over the world. So the question is really: Do
you, Michigan, want the film business? Do you want to
attract and tell stories and develop filmmakers in
Michigan? It's up to you guys.
"You might be on a path that locks you
into having incentives, but it's a changing world. The
culture's changing. ... It sounds like (saying) 'We're
just throwing our money away.'
"And the question is, Are you? Are you
developing filmmakers? Do you want to develop
filmmakers? This is a world that uploads 57,000 hours of
video to YouTube every week. The culture is telling
stories. The culture is using video and film and
technology to tell stories. Do you want to be a part of
that, or do you want to be an observer?
"So yeah, you might be on the path
that once you start the incentives, you'll have to keep
them up. But maybe not if you're able to develop
writers, directors, financiers who say, 'Let's make our
own movies in Michigan. Let's train on Hollywood movies
that come to us, and we'll build up an infrastructure of
local talent that can write and direct and finance and
distribute our own movies.'
"Because the day's coming where it
won't matter where you're based. The movie
companies came to California for the sunshine. ... Now,
technology allows us to make movies without that
overabundance of sunlight -- now it doesn't matter.
"It's up to Michigan to decide what
they want to do."
Published by permission Michigan Business
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