Film Industry Takes Root in Detroit Metro

Calling itself “cheap and easy,” Detroit lures film producers with tax credits, a willing workforce and good weather — three seasons a year, anyway.

“Transformers” shooting in Detroit in 2006. Simon Davison via Flickr

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“Detroit. We’re Cheap and Easy.”

So goes the slogan of Film Detroit, a division of the Detroit Metro Convention & Visitors Bureau and a connection point between metro Detroit and Hollywood, which has already infused more than $260 million in gross production into the region.

In 2008, the Michigan government approved some of the largest film incentives in the country, providing a refundable tax credit of up to 42 percent for Michigan production work and a 25 percent credit for infrastructure development and on-the-job training. According to Ken Droz, who until recently served as Film Office communications consultant, the two-year old program has a gross production total of $350 million with $20 million “and counting” on the books for 2010.

“Approximately three-quarters of this activity is in metro Detroit, so that would be about a $260 million investment,” he says. Metro Detroit includes Wayne, Oakland and Macomb Counties.

Though the region continues to hold Hollywood’s attention, its cold winters and lack of large-scale indoor studio space generally makes it a three-season industry. “Nothing is complete yet in terms of large scale infrastructure and that’s one of the frustrations,” Droz says.

But there is some movement that could result in keeping large-scale films in Detroit during the winter. Michigan Motion Picture Studios recently committed $60 million to build a film complex at the General Motors Co. Centerpoint Business Campus in Pontiac, an investment that will allow for multiple indoor stages.

“Right now we’re hopeful that in 2011 we will have some of these larger studios available where we can put things under one roof,” says Film Detroit Senior Vice President Christopher Baum.

Though political squabbling concerning the credits tends to creep up during elections, the Michigan credits are fairly well received. However, according to the National Conference of State Legislators (NCSL), 45 states including Puerto Rico have some sort of film incentive, creating a very competitive atmosphere among states. States count on these credits as an economic driver but some states, such as Massachusetts, struggle when Hollywood heads to the newest state with the most lucrative credits or when major Hollywood-related real estate projects fall through.

But right now, Metro Detroit certainly isn’t hurting. Plenty of films including Gran Torino, Up in the Air and Little Red Devil have already been released. Steven Spielberg’s Real Steel and ABC’s Detroit 1-8-7 are just a few of many projects in production.

Since the credits are fairly new, it’s difficult to measure direct impact on job creation. In 2009, the Michigan Film Office Annual Report stated that more than 8,000 jobs were created as a result of the credits. The majority of production-related jobs are part-time. Universities and community colleges are enhancing production programs to keep up with demand for talent. In February, the U.S. Department of Labor issued a $438,000 community-based job-training grant to train Detroit-based residents for jobs in the film industry.

“So many aspects of the economic impact on this region as a result of these credits are overlooked,” Baum says. “There’s probably nothing in the state that people agree on more than having Hollywood here is good for Michigan. Other states with film incentives have found a greater return than what they expected. It ranges from $1.75 for every dollar spent to $8 or $9 in investment for every dollar spent. Even on the low end it’s a very good investment.”

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Tags: detroittaxes

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