Michigan Gov. Hopes to Boost Movie Business

Tim Martin - Associated Press

LANSING, Mich. - Michigan Gov. Jennifer Granholm signed legislation Monday aimed at giving the state a bigger role in the film industry, saying it could quickly boost the struggling economy.

Supporters say the legislation will make Michigan the most financially attractive state in the nation in which to make movies. State film officials say they've received more than 80 scripts for potential projects in anticipation of the new law, up from the half-dozen received in a typical year. Three films in preproduction are beginning to hire in Michigan.

But it won't come cheap. The key bill gives film studios a refund of up to 42 percent on production expenses in the state - at a time when Michigan's budget is tight and lawmakers raised taxes and cut spending last year to balance a $1.75 billion deficit.

An analysis from the nonpartisan Senate Fiscal Agency suggests that the legislation could generate more economic activity in the state and increase some tax revenues, but not enough to offset the costs of the incentives.

But the package won support from both Democrats and Republicans, and Granholm said the potential economic benefits are worth the cost.

"If we didn't have that tax credit, the work would just not be done here," Granholm said.

The bills also cover commercials, TV shows, documentaries, video games and other film work.

Michigan is desperately seeking ways to diversify its manufacturing-heavy economy. The state's February unemployment rate, 7.2 percent, was highest in the nation. But it is competing with more than 35 other states for movie business, with Louisiana, New Mexico and Connecticut among the most aggressive.

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