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Wednesday, August 8, 2018

SMART ASSETS: Year-Over-Year Traverse City Film Festival Financial Analysis Reveals Troubling Trend; What Is “State Run Films” Distribution?

“All these numbers may be normal flux, but we’ll need 2016 to see what the actual trend is.”

The anonymous comment (above) I received and published two days ago initiated further examination of several financial data points, key indicators of an organization's financial health: revenue and expenses.

In the case of the Traverse City Film Festival, I also examined contributions, at the suggestion of this reader.

And while Traverse City Film Festival founder Michael Moore recently revealed the organization has ordered a forensic audit of its financial records, my analysis is based only of festival's publicly-available IRS Form 990 filings.  


IRS Form 990, 990-EZ, or 990-PF must be filed by the 15th day of the 5th month after the end of an organization's accounting period.

For a calendar year organization like the Traverse City Film Festival, Form 990, 990-EZ, or 990-PF is due May 15 of the following year. For example, without filing for an extension, the 2016 report would be due by May 15, 2017. It appears the festival filed a request for a six-month extension, as the 2016 report was filed on November 15, 2017. 

The six-year snapshot of the Traverse City Film Festival's 
Total Contributions metric reveals a 2013 peak of $2,169,293, 
dropping in 2014 to $1,206,120. 

While 2014 and 2015's amounts were nearly identical, 2016's results revealed a 30 percent drop when compared with the previous year. (Click on chart images to enlarge.)


Similarly, revenue reflected a similar trend between 2015 and 2016, with $3,405,973 in 2015 dropping to $2,693,415—or nearly 21 percent.


Although revenue and contributions both dipped between 2015 and 2016, total expenses stayed relatively stable, resulting in a -$456,196 deficit for the year ending December 31, 2016.

However, there was one line item that drew my interest: a “trial run of distribution services” under the name “State Run Films”. And while the $51,627 expenditure linked to the effort is relatively small, I was unable to locate any reference to State Run Films in any other Traverse City Film Festival Form 990 filings. 

In addition, no iteration of State Run Films has never been incorporated in Michigan as a business entity, or even a Grand Traverse County DBA.

It may just be a coincidence, but I found a New York State business with that name, formed on June 5, 2018 on behalf of Michael Moore. 


According to official New York Department of State records, State Run Films LLC was formed on June 5, 2018. The New York City address of CPA firm that registered the name is linked to the website for Moore's upcoming film, “Fahrenheit 11/9”.

An inquiry to Larry Cohen at Marks Panneth, LLP requesting details about the entity (previous name, officers, etc.) remained unanswered at the publication of this story.

As shown below, a $51,627 expense was associated with the Traverse City Film Festival's program service accomplishments, one titled State Run Films Distribution/State Run Films under 4c. An in-depth online search turned up nothing related to State Run Films and the festival.

With $37,182 in revenue attributed to State Run Films Distribution's $51,627 expense, the line item showed a net loss of $14,445.

As you can see below, State Run Films LLC is the entity listed in the Privacy Policy for  Fahrenheit 11/9's site. While it appears that State Run Films LLC was formally registered in New York on June 5, 2018, a 'staterunfilms.com' domain name (a site not currently online) was previously registered on November 11, 2014, and linked to a 'domains@michaelmoore.com' Administrator contact.

If there's any information out there about State Run Films and its distribution effort links to the Traverse City Film Festival, I would be happy to publish it.

More on this story as it develops.

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