TRENTON – A bill sponsored by Senator Paul A. Sarlo which would offer tax credit incentives to digital media production companies to relocate to New Jersey was approved by the Assembly Telecommunications and Utilities Committee today.
“Digital media production is a fast-growing component of our national economy, and by being at the forefront of business growth incentives for the industry, New Jersey can capitalize on a wonderful opportunity,” said Senator Sarlo, D-Bergen, Essex and Passaic. “We need to position the Garden State to be at the center of the digital media expansion, ensuring thousands of jobs for State residents and bringing in millions in new revenue to the State.”
Senator Sarlo’s bill, S-2526, would provide tax credits to digital media production companies relocating in the State. The bill makes available a corporate business tax credit for certain digital media content expenses, and would amend New Jersey’s film production expenses credit program to provide a credit for digital media companies as well. The measure is patterned after the State’s successful film production credit program, which has served as a valuable incentive for film producers to shoot in the Garden State, and is designed to draw in high-tech, high-growth digital media business to New Jersey.
“We know there’s more to bringing in these companies than simply bragging rights,” said Senator Sarlo. “New Jersey would see a very real benefit to hosting some of the cutting-edge firms which are leading the way in digital arts, communications and technology. By investing State dollars in encouraging digital media business growth in New Jersey, we will be able to see huge returns that will benefit the people of the State.”
Senator Sarlo pointed to a study by global business analysts Ernst and Young, who project that S-2526 in the first five years after becoming law will generate:
* More than 4,350 new high-wage jobs;
* In excess of $311 million in new wages for New Jersey residents;
* Almost $1 billion dollars of total economic output by businesses relocating and expanding in New Jersey.
Senator Sarlo’s bill would also generate tax revenues for New Jersey and local governments that will exceed the amount of credits issued in year five, for example, by almost sixteen million dollars.
“At a time when the state of New Jersey’s economy isn’t necessarily a sure thing, this proposal will generate guaranteed results for the State,” said Senator Sarlo. “We know that the business community is struggling under the State’s tough regulatory structure, and in some cases, leaving for a better tax environment. This bill will ensure a healthy business climate, and continued opportunity for New Jersey’s skilled workforce.”
Senator Sarlo added that his bill has generated strong support from several key players in the digital media industry. At a news conference last month to unveil the legislation, representatives from several major companies and advocacy groups – including the American Electronics Association, the Motion Picture Association of America, NBC Universal, Cisco Systems, and the New Jersey Institute of Technology (NJIT) – were on hand to praise the measure.
“The digital media producers are excited about this proposal, and look forward to working as partners in New Jersey’s economy,” said Senator Sarlo. “We need to act in good faith, and do everything we can to encourage business growth in the Garden State. By attracting some of the best and brightest companies pushing the envelope with today’s technology, we can ensure the economic vitality of New Jersey for years to come.”
The bill now heads to the Assembly Appropriations Committee for consideration, before going to the full Assembly for review. It’s currently pending consideration in the Senate Budget and Appropriations Committee.