Indirect Econ. Impact of Film Shoots in Michigan Insignificant According to Small Business Owners
Film Office Botches Propaganda
This will be the last Michigan post today, I promise. But these two stories were too entertaining to pass up. While I just lauded Michigan for taking quick action to increase transparency and accountability in the state’s film office, which is great, the film office itself has made a few fumbles of late.
On June 18, Tom Gantert of Michigan Capitol Confidential wrote an interesting investigative piece about a phantom diner lauded by state film officials as an example of how the movie industry was causing indirect ripple effects to the Michigan economy.
Apparently, fame can be fleeting in the movie industry, even if you are just a Michigan business trying to cash-in on it. The Oink Joint, a diner in Birch Run Township, made a public relations splash after it was featured in the 2009 Drew Barrymore movie “Whip It.”
The building — formerly Ken’s Diner — was part of the filming for the movie in 2008, and then the fictional diner was made into a real-life diner with the same name, using menus from the movie.
Governing magazine mentioned the Oink Joint in its June 2010 issue story about Michigan’s film tax incentives. That article talks about how a shuttered diner was reopened as the Oink Joint after all the local notoriety.
The only problem? The Oink Joint closed several months ago, according to Birch Run Township officials.
The Michigan Film Office promoted it on its website as a “success story” for the tax incentives moviemakers get from Michigan. According to the Michigan Film Office website, the Oink Joint “has been a huge tourist attraction.” The Film Office stated that $30,000 of building renovations was done by the film company, an expense they could have received up to 42 percent back in tax credits. Also, 300 Oink Joint T-shirts and 75 baseball caps were sold.
The Film Office link was available until yesterday afternoon, but appears to have been removed shortly after Michigan Capitol Confidential called the Film Office to ask about the Oink Joint. The link now reads “Sorry. The Success Story was not found.”
A screen shot of the original “Success Story” page is available here.
“This is just another example of government bluster,” Drolet said. “All that it has left Michigan is another closed business, an unemployed pig and 75 baseball caps. … It is a powerful symbol of the film industry. They can’t create sustained prosperity and wealth. They can provide the illusion of wealth for a brief moment. Just like at the theater, it provided an illusion for a short time. When you come out of the theater, you are back in the real world. And just like the theater, you overpaid for your popcorn and candy.”
To read the rest of Gantert’s article, click HERE
The other story comes from Christopher Behnan of the Daily Press and Argus on June 30th. This one provides another snafu by the film office in it’s zeal to paint the impact of the states film incentive in the best possible light. And while that’s noble, it helps if the claims they make are accurate.
Howell Soft Cloth Car Wash owner Tom O’Connell said the Michigan Film Office misquoted him in its 2009 annual report in order to “justify” Michigan’s generous film-tax-incentive program.
O’Connell sold diesel fuel to the production of the stoner comedy “High School,” shot primarily at the Howell Public Schools Parker Campus in Marion Township in late 2008.
His business, at 1009 S. Michigan Ave. in Howell, was one of several “individual success stories” the Film Office listed in the Film Office report.
O’Connell is quoted as saying, “It definitely made my fiscal year. I’d do it again tomorrow. Send them back,” following data stating his diesel-fuel business doubled in fall of 2008 as a result of “High School” shooting in the area.
He said he’d welcome more business from film companies shooting in Michigan, but that he was misquoted as saying the program “made my fiscal year.”
“I said, ‘Absolutely not,’ ” O’Connell recalled of his conversation with Ken Droz, Film Office spokesman.
“It’s not even close to making my fiscal day,” he added.
The Michigan business owner then described his contacts with the film office and said they more interested in generating propaganda for the state incentives “rather than getting an accurate business story.” I am frustrated by this. I understand that any state office is going to make use of positive publicity for their office, program etc. But it seems to me that some in the office should be more concerned about evaluating the program from a cost-benefit perspective to evaluate the efficacy of the policy and/or make recommendations to alter the program. Such a notion, which is basically serving the public trust, requires that true and accurate information is reported without spin.
States need the truth, not spin and propoganda to judge whether film incentives are good public policy. If lawmakers are getting economic impact anecdotes that are actually propaganda disguised as facts. Surely, the film office could find wonderful examples of new economic growth from the film industry that would not need any spin.
He said Droz attempted to elicit positive responses from him to Michigan’s film-tax incentive — which rebates up to 42 percent of production-related expenses — rather than to get an accurate business story.
During the filming of “High School,” O’Connell’s diesel-fuel business increased from about 25 gallons to 50 gallons per day to as much as 300 gallons per day, according to the report and O’Connell’s estimates.
The “High School” production paid an upfront, $3,000 security deposit with O’Connell, and paid a weekly bill for purchased diesel fuel.
What the film report doesn’t explain, O’Connell said, is that diesel fuel — and the gas station business as a whole — makes up a fraction of his overall revenues.
He said his car wash, located next to his gas station, brings in about 95 percent of his revenue, and that he saw no increase in car-wash sales while the film was in town.
He estimated the deal brought in about $2,400 per week in diesel-fuel sales, but far less in actual business profits. The production also purchased five propane tanks from his business.
“There’s no significance to it. It’s an insignificant amount of sales,” O’Connell said.
“We don’t make money off of gasoline. It’s a drawing card for our customers,” O’Connell added. “I’ve operated that way for 35 years.”
Droz, who compiles “success stories” based on leads from production crews and vendors, said he intended to strike the statement “it definitely made my fiscal year” from the report, issued in March.
He said all business summaries in the report were submitted to the listed businesses for review, and that the Film Office sought any needed corrections, revisions and approvals.
In an e-mail chain from June 2009, Droz said O’Connell pointed out another error stating that he did business with the production of “Betty Anne Waters,” which shot scenes in Livingston County, including at the historical Livingston County Courthouse in downtown Howell.
Droz omitted the “Betty Anne Waters” reference, but said he realized Tuesday he accidentally left in the “fiscal year” mistake after being asked about it by the Daily Press & Argus.
He said the second error will be removed from the PDF version of the report on the Film Office’s Web site.
“I should have removed that, and I did not, and I should apologize to him,” Droz said.
He noted that O’Connell didn’t object to comments about welcoming return business from the film industry.
“He left that in there, and I remember him saying it,” Droz said.
“It sounds like an intriguing situation in that he doesn’t philosophically believe in the program, but that he’s very happy to have the business,” he later added.
O’Connell admitted he’s “conflicted” by the film-tax incentive.
He said he’s against the program as a Michigan citizen and taxpayer, but conceded he’d welcome more business from movie productions as a businessman.
O’Connell had a separate arrangement with “The Wannabes Starring Savvy” production, in which the production had a $1,500 security deposit for diesel fuel and paid weekly for fuel.
He said he was upset, however, when he learned diesel fuel he sold to the “High School” production was used to melt snow for scenes set in California, but filmed in a snowy Michigan winter.
He said using the fuel for that purpose — and potentially being rebated for it by Michigan taxpayers — was a waste, and that the scenes could have been shot snow-free a few weeks later.
“Why not give it (film-incentive money) to the automobile companies if we’re going to throw it down the drain? There’s more important things that we can do with our tax dollars,” O’Connell said.
Droz said problems with the program have been few and far between, and that office works to help resolve all problems that arise with the incentive.
“We don’t want anybody unhappy about the experience,” he said.
O’Connell said it’s “absolutely insane” for Michigan taxpayers to help finance the film industry, and that he’d be willing to testify about his experience in Lansing as early as today’s state House hearing on the program’s transparency.
“I think it’s that important,” he said.
The 2009 report also states Howell Western Wear experienced “an unexpected windfall of sales, PR (public relations) and word-of-mouth” when scenes for “Betty Anne Waters” were shot in town.
Film stars Hilary Swank and Minnie Driver shopped at the store, as did the entire crew.
Store manager Dick Shaw in March said the store had a temporary boost in sales, but not a long-lasting one.
“We may have gotten a little bit of traffic off of the fact that the movie people were in here and there was some world of mouth. I can’t say that it gave us an ongoing business,” Shaw said.
“We’re not still enjoying business from that, unfortunately,” he added.
To read the entire article, click HERE
