LANSING – Legislation that would make permanent the Michigan film incentive program, simplify the incentives and make taxable some of the post-release income generated by the productions cleared the House Commerce Committee on Wednesday.
The committee made no major changes to the legislation, SB 1103 , a top priority of Senate Majority Leader Randy Richardville (R-Monroe) to complete before he leaves office at the end of this year.
One of the key pieces of the bill is to remove the sunset on the program, now set for September 30, 2017.
The legislation also would revise the wide variety of incentive levels for direct production expenditures, instead consolidating them into one incentive equal to 25 percent of direct production and qualified personnel expenditures. The bill also deletes a $2 million per employee limit.
And the bill would require that Michigan residents be hired to work on qualified productions at phased-in ratios of residents to nonresidents, unless there were not enough qualified Michigan residents for the positions.
Another key change would subject residual income, like royalties, to above-the-line personnel, personal service corporations, loan out companies, professional employer organizations, limited liability companies and corporations to the Michigan income tax.
Backers of the legislation say it will stabilize and simplify the program.
“This makes it more competitive,” Andrew Richner of Clark Hill, speaking on behalf of Michigan Motion Picture Studios, said. “We really want to move more toward a permanent workforce in the state.”
