Bill Would Revive & Expand Tax Credit Program
TRENTON – Legislation authored by Senate Majority Leader Loretta Weinberg, D-Bergen, Senator Raymond J. Lesniak, D-Union, and Senator Paul Sarlo, D-Bergen, that would expand and update the tax credit program for the film industry was approved by the Senate on Thursday with a vote of 33 to 3.
Offering incentives to movie makers, TV producers and digital media companies to locate in New Jersey, the “Garden State Film and Digital Media Jobs Act” would extend the existing program to 2022, increase the tax credits to $50 million for the film industry and to $10 million for digital media, and establish a training program for college students.
“We want movies, TV shows and motion pictures to be filmed and produced in New Jersey,” said Senator Weinberg. “They produce jobs and economic activity and they are part of the state’s cultural identity.”
In 2010, Governor Chris Christie suspended the existing incentive program, which had caps of $10 million for motion pictures and $2 million for digital media. No tax credits have been awarded since, leaving New Jersey at a competitive disadvantage.
“There is a lot of competition among states to attract filmmakers and industry executives say that tax incentives are often the deciding factor,” said Senator Lesniak. “Reauthorizing and expanding the state incentive program should be a top priority at a time when the state’s economy is in need of all the help it can get.”
The bill, S-779, includes an “educational component” that is good for New Jersey’s colleges and universities and their students, Senator Lesniak said. It would create partnerships with schools to offer students training, internships and production experience. The enhanced program will also produce revenue for the schools, Senator Lesniak noted.
The measure also includes a “net benefits test” that would require applicants for the tax credits to detail the benefits that would result from the incentives.
The legislation allows for tax credits of 20 percent for production expenses and 22 percent for goods from businesses located in an Urban Enterprise Zone. It also allows credits for digital media, an increasingly important technology in the film and TV industries.
“Digital media is a growth industry that offers both immediate and long-term value,” said Senator Sarlo. “There is a natural synergy between digital technology and the film industry. We want to take advantage of that in ways that position us for new developments, new technologies and future opportunities.”
The new legislation would also have the state’s Economic Development Authority work with the motion picture industry to evaluate the feasibility of building a film production studio in North Jersey, where it would be accessible to New York City and its concentration of media companies.
Dr. Michael Ehrlich, of the New Jersey Institute of Technology’s School of Management, has said that his research shows that the economic benefits of the dormant program were greater than the tax credits and that the expanded version would be even more beneficial to the economy.