Could New Jersey’s Production Tax Credit Return With Exit of Gov. Chris Christie?

New Jersey Gov. Chris Christie’s pending exit in January after seven years in office could spark the rebirth of the state’s film and television production tax incentive.

In 2005, the Garden State created a 20% tax credit program to boost film production throughout New Jersey. But in 2010, Christie suspended the incentive due to his dislike of the MTV reality show “Jersey Shore.”

While the New Jersey Economic Development Authority approved a $420,000 tax break for filming “Jersey Shore” in the state in 2009 — the series’ inaugural season — Christie reneged on the credit in 2011, arguing that the show about Snooki and the gang tarnished the state’s reputation.

New Jersey doesn’t have a tax incentive program because Mr. Christie thinks it won’t work, which is absurd.
Tom Bernard, Sony Pictures Classics

“I have no interest in policing the content of such projects,” Christie said in a 2011 statement. “However, as chief executive, I am duty bound to ensure that taxpayers are not footing a $420,000 bill for a project which does nothing more than perpetuate misconceptions about the state and its citizens.”

Police he did. That same year, Christie permitted payment on tax credits for other New Jersey-based productions including WWE’s “Hell in a Cell” Newark event and the Kyra Sedgwick film “Chlorine.” During its active years, New Jersey awarded NBC’s “Law & Order: SVU” more than $10.2 million in tax credits for the 2009-10 season.

While “Jersey Shore” didn’t necessarily place the state in the best light, Tax Credits Intl.’s Christine Peluso said in 2014 that the series provided an undeniable economic boost: Parking meter fee collection in the show’s Seaside Heights setting jumped from $807,000 in 2007 to $1.3 million in 2010. In addition, Peluso noted the reality show’s crew and fans helped the local economy with the purchase of hotel rooms, car rentals, catering, hardware, dry cleaning, rental fees and permit fees, among other expenses.

The New York/New Jersey Issue

In 2016, a bill titled the Garden State Film and Digital Media Jobs Act attempted to reauthorize and revise the state’s expired film tax credit programs. The measure, approved by legislators from both parties, proposed an increase of the annual program cap from $10 million to $50 million. Christie vetoed the bill.

The governor’s opponents, including New Jersey resident and Sony Pictures Classics co-president Tom Bernard, argue that Christie’s decision has hurt the state.

“There are 14,000 New Jersey residents who work in the entertainment industry,” says Bernard, who is a member of the state’s Motion Picture and Television Commission. “They all have to go into the New York area to work because New Jersey doesn’t have a tax incentive program because Mr. Christie thinks it won’t work, which is absurd. It has worked all over the country — why wouldn’t it work in New Jersey?”

Come July, according to Bernard, during the state’s budget negotiations, a new tax rebate deal is a “sure thing.”

“There is a draft [of the rebate bill] written and sitting with the head of the Democratic Senate waiting to be put out onto the floor after the election,” Bernard says. Democratic gubernatorial nominee “Phil Murphy is a big proponent and feels it will bring a lot of money to the state.”

If the bill does pass, New York state could lose quite a bit of business.

To wit: In 2016, New York had some 185 film and television projects apply for credit, which the Empire State estimated would generate a record-breaking 200,501 new hires and $3.3 billion in new spending statewide. In Andrew Cuomo’s six years as governor of New York, more than 1,000 film and TV projects applied for the tax credit. Those that received incentive support generated an estimated $15 billion in spending and approximately 934,000 new hires in the state.

CREDIT: Eddie Guy for Variety

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