Film production | Photo by Gordon Cowie on Unsplash
TRENTON, NJ – The New Jersey Economic Development Authority (NJEDA) Board has approved proposed amendments to the New Jersey Film & Digital Media Tax Credit Program rules to attract more production companies to film and create digital media content in New Jersey and to encourage the development of large-scale studios in the state.
These amendments address other statutory changes such as increases to the amount of tax credits available annually under the program to $100 million per state fiscal year for applicants not considered film-lease partners or studio partners, $100 million per state fiscal year for studio partners, $100 million per state fiscal year for film-lease partners, and $30 million per fiscal year for digital media projects.
Statutory changes now allow the program to run through 2034 and increase the credit allowed for film projects from 30 percent to 35 percent of certain qualified film production expenses. The digital media tax credit was also increased from 20 percent to 30 percent. The rules establish annual reporting requirements for specific projects and allow the Authority to recapture or reduce the tax credit amounts for certain projects.
The proposed new rules approved by the NJEDA Board address changes to the legislation, including an increase in the amount of tax credits available annually, specific allocations of tax credits for long-term commitments from larger studio development projects, an expansion of the program’s diversity bonus, and an extension of the timeline of the program to 2034.
“New Jersey has positioned itself as a compelling destination for the film and digital media industry under Governor Murphy’s leadership as we continue to attract big-studio productions to our state,” said NJEDA CEO Tim Sullivan. “Our diversity of locations means you can film mountains, cities, beaches and farms all in the same day, while our best-in-class tax incentive program and unmatched talent pool make New Jersey among the most cost-effective places in the nation to shoot a film. That’s a powerful combination and the film industry has begun to take notice.”
In addition, the proposed new rules include other statutory additions such as an increase in the diversity bonus from two percent to four percent to encourage hiring minority, local, on-screen talent, which will help ensure opportunities are accessible to qualified New Jersey residents from all backgrounds.
Since its creation, over 68 productions have been approved for tax credits based on expenditures of $766 million into the state’s economy. These tax incentives have helped to attract major film and television productions to New Jersey, such as “Joker,” “West Side Story,” “The Many Saints of Newark,” and CBS’ “The Equalizer.”
Sullivan noted that, to date, more than half of productions supported by the program were approved for bonuses based on the inclusion of diversity plans for recruiting and hiring minorities and women.
The proposed rules approved by the Board will be published for public comment, after which the Board will consider the final adoption of the rules.
“The New Jersey Film and Digital Media Tax Credit program is paving the way for our state to reinforce its legacy as premier destination for leading film and television productions,” said New Jersey Secretary of State Tahesha Way. “Under Governor Murphy’s leadership, this program has brought many productions to our state, creating job opportunities for people from diverse backgrounds, and injecting millions of dollars into local businesses. This translates into long-term economic benefits and improved quality-of-life for these communities and their residents.”
In addition to the Film and Digital Media Tax Credit program, the Economic Recovery Act (ERA) creates a suite of programs that includes tax credits to incentivize job creation, new construction, and revitalization of brownfields; financial resources for small businesses; support for new supermarkets and healthy food retailers in food desert communities; and new funding opportunities for early-stage companies in New Jersey. More information about these programs is available at https://njeda.com/economicrecoveryact.
–With Jay Domingo/PDM