Thursday, March 07, 2013

Michigan taxpayers gave Disney money

Michigan paid millions of dollars to the Walt Disney company, helping to create a movie to substantially create wealth for Californians, minimally stimulate economic activity for Michiganians, and ultimately we paid for someone else's stuff.
the state played a part in allowing one of the most lucrative companies in the world to post a record $4.8 billion in profits by handing it nearly $40 million in film tax credits.
That was the year Disney made the movie, "Oz: The Great and Powerful," and received $39.7 million of the $75.2 million the state of Michigan handed out to film producers. Ironically, the state film subsidy nearly matched the $39.8 million salary Walt Disney Chief Executive Robert Iger was paid in 2012.
"Oz" was filmed in Pontiac at Michigan Motion Picture Studios, formerly known as Raleigh Studios. The movie officially opens on Friday.
While Disney went on to post a record profit, Raleigh Studios struggled. It has missed three payments to investors, which had to be paid for by the State of Michigan Retirement Systems. The state has paid $1.68 million in the last year and is on the hook for $18 million in bonds if the Michigan Motion Pictures Studios is unable to make its payments to bondholders.
Gov. Rick Snyder has proposed slashing the amount the state gives to filmmakers by 50 percent, cutting the $50 million cap to $25 million.
The company that applied for the Michigan film credit for "Oz" was Emerald City Film Inc. According to California’s Secretary of State, Emerald City Film Inc.’s CEO is Jim Kaperstein, who is the associate general counsel at The Walt Disney Co. Disney confirmed in an email that Kaperstein started Emerald City Film and the address listed with the business filing with the California Secretary of State is the same as Walt Disney Studio’s Burbank, Calif., location.
Disney got millions in federal aid in 2010, too... In 2010, State Rep. Tom McMillin, R-Rochester Hills, spent hours sifting through receipts filmmakers put in for reimbursement from the state.
"Do you know what businesses have to make to pay $40 million in taxes?" Rep. McMillin said, referring to what other business had to pay for Disney to get the subsidy. "For Michigan businesses to pay $40 million, they had to lay off or not hire a lot of people. I don't like that it went out of the state and continued to enrich millionaires and billionaires with government subsidies."
For 2010-11, the Michigan Senate Fiscal Agency found that even among the most optimistic of assumptions, the film program brought the state only $0.11 per dollar spent. The subsidies cost Michigan taxpayers $125 million and returned $13.5 million in 2010-11.
I'm tempted to say we simply paid Robert Iger's salary one year.

No comments: