CHICAGO — A Michigan film studio has defaulted on its Feb. 1 payment on $18 million of privately placed tax-exempt bonds, forcing the state pension plans, which back the debt, to make the payment.

Based in the Detroit suburb of Pontiac, Raleigh Studios LLC opened in March 2011 as one of Michigan’s largest film studios.

The $80 million project was expected to create thousands of jobs in Pontiac, which is under emergency management. It benefited from generous tax credits, exemption from most property and income taxes for 15 years, and up to $4 million in federal funding.

The studio was launched when Michigan, under former Gov. Jennifer Granholm, had one of the most generous film tax-credit programs in the country. It offered incentives covering more than 40% of a studio’s production costs.

Gov. Rick Snyder slashed the program when he took office last year, putting a $25 million annual cap on tax benefits.

Raleigh Studios, which bills itself as the “largest independent studio operator in the country,” leased the space for most of last year to the Walt Disney Co., which used it to film “Oz: The Great and Powerful.” Raleigh did not respond to requests for comment.

Since then, however, the space has stood empty, and with no revenue, the studio was unable to make its full Feb. 1 payment to bond trustee U.S. Bank NA.

As required under the bond agreement, the State of Michigan Retirement Systems covered the payment, said Michigan Treasury Department spokesman Terry Stanton. Of the $630,000 due to bondholders, the retirement system paid $420,000.

If the studio is unable to find a new tenant, the SMRS would cover the next payment, $630,000 due in August, he said. The retirement system, in fact, would be required to make all payments for the next 10 years if the studio is unable to come up with the money.

The bond agreement also includes a forbearance period of seven years, so the SMRS can’t take lien enforcement action during that time, according to Stanton.

The Oakland County Economic Development Corp. in 2010 was the conduit issuer for $28 million of recovery zone facility bonds to finance the project.

The bonds were sold in three series. The largest, worth $18 million, has an unconditional guarantee from the state’s retirement systems. The bonds do not have backup pledges from the county or Pontiac.

Raymond James & Associates Inc. privately placed the $18 million series with a handful of large institutional investors. The rest of the debt, a $5 million series and a $4.8 million series, was purchased by affiliates and family of the borrower.

A reserve fund was not required until several years after the sale, said an attorney familiar with the transaction.

Bond documents touted the flourishing industry and noted that film expenditures in Michigan nearly doubled from 2008 to 2009.

Revenue projections showed steady growth for the studio, with gross profits reaching $14 million annually within the next decade.

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