Requires annual competitive tax credit auctions; dedicates proceeds to NJ Civic Information Consortium and public broadcasting system; reduces tax credits available for certain film productions; appropriates $15 million.

S4323

SENATE, No. 4323

STATE OF NEW JERSEY

222nd LEGISLATURE

�

INTRODUCED MAY 21, 2026

Sponsored by:

Senator� ANDREW ZWICKER

District 16 (Hunterdon, Mercer, Middlesex and Somerset)

Senator� JOHN J. BURZICHELLI

District 3 (Cumberland, Gloucester and Salem)

Co-Sponsored by:

Senator Turner

SYNOPSIS

���� Requires annual competitive tax credit auctions;
dedicates proceeds to NJ Civic Information Consortium and public broadcasting
system; reduces tax credits available for certain film productions;
appropriates $15 million.

CURRENT VERSION OF TEXT

���� As introduced.

��

An Act
concerning the auction of tax credits to support civic
information and public broadcasting, amending P.L.2018, c.56, supplementing
P.L.1968, c.405 (C.48:23-1 et seq.), and making an appropriation.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� Section 1 of P.L.2018,
c.56 (C.54:10A-5.39b) is amended to read as follows:

���� 1. a. (1) A taxpayer, upon
approval of an application to the authority and the director, shall be allowed
a credit against the tax imposed pursuant to section 5 of P.L.1945, c.162
(C.54:10A-5) in an amount equal to, in the case of a taxpayer designated as a
New Jersey studio partner or New Jersey film-lease production company, 40
percent, and in the case of a taxpayer other than a New Jersey studio partner
or New Jersey film-lease production company, 35 percent, of the qualified film
production expenses of the taxpayer during a privilege period commencing on or
after July 1, 2018 but before July 1, 2049, provided that:

���� (a) at least 60 percent of the
total film production expenses, exclusive of post-production costs, of the
taxpayer are incurred for services performed and goods purchased through
vendors authorized to do business in New Jersey or the qualified film production
expenses of the taxpayer during the privilege period for services performed and
goods purchased through vendors authorized to do business in New Jersey exceed
$1,000,000 per production;

���� (b)�� principal photography of
the film commences within 180 days from the date of the original application
for the tax credit;

���� (c)�� the film includes, when
determined to be appropriate by the commission, at no cost to the State,
marketing materials promoting this State as a film and entertainment production
destination, which materials shall include placement of a "Filmed in New
Jersey" or "Produced in New Jersey" statement, or an appropriate
logo approved by the commission, in the end credits of the film;

���� (d)�� the taxpayer submits a
tax credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection f. of this
section; and

���� (e)�� the taxpayer complies
with the withholding requirements provided for payments to loan out companies
and independent contractors in accordance with subsection g. of this section.

���� (2)�� Notwithstanding the
provisions of paragraph (1) of subsection a. of this section to the contrary,
the tax credit allowed pursuant to this subsection against the tax imposed
pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) shall be in an amount
equal to, in the case of a taxpayer designated as a New Jersey studio partner,
40 percent, in the case of a taxpayer designated as a New Jersey film-lease
production company, 35 percent, and in the case of a taxpayer other than a New
Jersey studio partner or New Jersey film-lease production company, 30 percent,
of the qualified film production expenses of the taxpayer during a privilege
period that are incurred for services performed and tangible personal property
purchased for use at a sound stage or other location that is located in the
State within a 30-mile radius of the intersection of Eighth Avenue/Central Park
West, Broadway, and West 59th Street/Central Park South, New York, New York.

���� b. (1) A taxpayer, upon
approval of an application to the authority and the director, shall be allowed
a credit against the tax imposed pursuant to section 5 of P.L.1945, c.162
(C.54:10A-5) in an amount equal to: 30 percent of the qualified digital media
content production expenses of the taxpayer during a privilege period
commencing on or after July 1, 2018 but before July 1, 2049, provided that:

���� (a) at least $2,000,000 of the
total digital media content production expenses of the taxpayer are incurred
for services performed and goods purchased through vendors authorized to do
business in New Jersey, provided, however, that for applications submitted
after the effective date of P.L.2024, c.33, qualified wage and salary payments
made to full-time employees working on digital media shall not be deemed an
expense incurred for services performed;

���� (b) at least 50 percent of the
qualified digital media content production expenses of the taxpayer are for
wages and salaries paid to full-time or full-time equivalent employees in New
Jersey;

���� (c)�� the taxpayer submits a
tax credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection f. of this
section; and

���� (d)�� the taxpayer complies
with the withholding requirements provided for payments to loan out companies
and independent contractors in accordance with subsection g. of this section.

���� (2)�� Notwithstanding the
provisions of paragraph (1) of subsection b. of this section to the contrary,
the tax credit allowed pursuant to this subsection against the tax imposed
pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5) shall be in an amount
equal to 35 percent of the qualified digital media content production expenses
of the taxpayer during a privilege period that are incurred for services
performed and tangible personal property purchased through vendors whose
primary place of business is located in Atlantic, Burlington, Camden, Cape May,
Cumberland, Gloucester, Mercer, or Salem County.

���� (3) Notwithstanding the
provisions of paragraph (1) of this subsection to the contrary, the tax credit
allowed pursuant to this subsection against the tax imposed pursuant to section
5 of P.L.1945, c.162 (C.54:10A-5) shall be in an amount equal to 40 percent of
the qualified digital media content production expenses of the taxpayer during
a privilege period that are incurred for post-production services, including
visual effects services performed at a New Jersey film-lease partner facility,
that are incurred by a taxpayer that is a New Jersey film-lease post-production
company or that are incurred by a taxpayer that is a New Jersey studio partner,
provided that:

���� (a)�� at least $500,000 of the
qualified digital media content production expenses are incurred for
post-production services, including visual effects services performed at a New
Jersey film-lease partner facility, are incurred by a taxpayer that is a New
Jersey film-lease post-production company or are incurred by a taxpayer that is
a New Jersey studio partner;

���� (b)�� the taxpayer submits a
tax credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection f. of this
section; and

���� (c)�� the taxpayer complies
with the withholding requirements provided for payments to loan out companies
and independent contractors in accordance with subsection g. of this section.

���� (4)�� Notwithstanding the
provisions of paragraph (1) of this subsection to the contrary, the tax credit
allowed pursuant to this subsection against the tax imposed pursuant to section
5 of P.L.1945, c.162 (C.54:10A-5) shall be in an amount equal to 35 percent of
the qualified digital media content production expenses of the taxpayer during
a privilege period that are incurred for post-production services, including
visual effects services performed by a qualified post-production company,
provided that:

���� (a)�� at least $500,000 of the
qualified digital media content production expenses of the taxpayer are
incurred for post-production services, including visual effects services
performed by a taxpayer that is a qualified post-production company, which may
include qualified digital media content production expenses incurred for
post-production, including visual effects activities performed by a business
entity in which the qualified post-production company has an ownership interest
of at least 51 percent;

���� (b)�� the taxpayer submits a
tax credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection f. of this
section; and

���� (c)�� the taxpayer complies
with the withholding requirements provided for payments to loan out companies
and independent contractors in accordance with subsection g. of this section.

���� c.���� No tax credit shall be
allowed pursuant to this section for any costs or expenses included in the
calculation of any other tax credit or exemption granted pursuant to a claim
made on a tax return filed with the director, or included in the calculation of
an award of business assistance or incentive, for a period of time that
coincides with the privilege period for which a tax credit authorized pursuant
to this section is allowed.� The order of priority in which the tax credit
allowed pursuant to this section and any other tax credits allowed by law may
be taken shall be as prescribed by the director.� The amount of the tax credit
applied under this section against the tax imposed pursuant to section 5 of
P.L.1945, c.162 (C.54:10A-5), for a privilege period, when taken together with
any other payments, credits, deductions, and adjustments allowed by law shall
not reduce the tax liability of the taxpayer to an amount less than the
statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162
(C.54:10A-5).� The amount of the tax credit otherwise allowable under this
section which cannot be applied for the privilege period due to the limitations
of this subsection or under other provisions of P.L.1945, c.162 (C.54:10A-1 et
seq.) may be carried forward, if necessary, to the seven privilege periods
following the privilege period for which the tax credit was allowed.

���� d. (1) A taxpayer, with an
application for a tax credit provided for in subsection a. or subsection b. of
this section, may apply to the authority and the director for a tax credit
transfer certificate in lieu of the taxpayer being allowed any amount of the
tax credit against the tax liability of the taxpayer.� The tax credit transfer
certificate, upon receipt thereof by the taxpayer from the authority and the
director, may be sold or assigned, in full or in part, to any other taxpayer
that may have a tax liability under the "Corporation Business Tax Act
(1945)," P.L.1945, c.162 (C.54:10A-1 et seq.), the "New Jersey Gross
Income Tax Act," N.J.S.54A:1-1 et seq., sections 2 and 3 of P.L.1945,
c.132 (C.54:18A-2 and C.54A:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15),
or N.J.S.17B:23-5, in exchange for private financial assistance to be provided
by the purchaser or assignee to the taxpayer that has applied for and been
granted the tax credit.� The tax credit transfer certificate provided to the
taxpayer shall include a statement waiving the taxpayer's right to claim that
amount of the tax credit against the tax imposed pursuant to section 5 of
P.L.1945, c.162 (C.54:10A-5) that the taxpayer has elected to sell or assign.�
The sale or assignment of any amount of a tax credit transfer certificate
allowed under this section shall not be exchanged for consideration received by
the taxpayer of less than 75 percent of the transferred tax credit amount.� Any
amount of a tax credit transfer certificate used by a purchaser or assignee
against a tax liability under P.L.1945, c.162 (C.54:10A-1 et seq.), sections 2
and 3 of P.L.1945, c.132 (C.54:18A-2 and C.54A:18A-3), section 1 of P.L.1950,
c.231 (C.17:32-15), or N.J.S.17B:23-5 shall be subject to the same limitations
and conditions that apply to the use of a tax credit pursuant to subsection c.
of this section.� Any amount of a tax credit transfer certificate obtained by a
purchaser or assignee under subsection a. or subsection b. of this section may
be applied against the purchaser's or assignee's tax liability under
N.J.S.54A:1-1 et seq. and shall be subject to the same limitations and
conditions that apply to the use of a credit pursuant to subsections c. and d.
of section 2 of P.L.2018, c.56 (C.54A:4-12b).

���� (2)�� A credit issued to a
taxpayer, including the purchaser or assignee of a tax credit transfer
certificate, may first be taken by the tax certificate holder for the tax
period for which it was issued, for the tax period in which it was issued, or
in any tax period during the time a business is required to maintain the
project at a location in this State, subject to the carryforward provisions of
this section.� The tax credit transfer certificate holder may transfer the tax
credit amount on or after the date of issuance for use by the transferee in the
tax period for which it was issued, in the tax period for which it was issued,
or in any of the next successive tax periods, subject to the carryforward
provisions of this section.� The tax certificate holder or transferee may first
use the credit against tax liabilities in the tax period in which it was issued
or in a succeeding tax period, as authorized in this paragraph, subject to the
carryforward provisions in this section, without the need to amend the return
for the year for which the credit was issued.

���� e. (1) The value of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, approved by the director and the authority pursuant to
subsection a. of this section and pursuant to subsection a. of section 2 of P.L.2018,
c.56 (C.54A:4-12b), and except as provided in section 98 of P.L.2020, c.156
(C.34:1B-362), to taxpayers, other than New Jersey studio partners and New
Jersey film-lease production companies, shall not exceed a cumulative total of
$100,000,000 in fiscal year 2019 and in each fiscal year thereafter prior to
fiscal year 2050, to apply against the tax imposed pursuant to section 5 of
P.L.1945, c.162 (C.54:10A-5) and the tax imposed pursuant to the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.� In addition to the
limitation on the value of tax credits approved by the director for New Jersey
film-lease production companies and the limitation on the value of tax credits
approved by the director for other taxpayers imposed by this paragraph, and except
as provided in section 98 of P.L.2020, c.156 (C.34:1B-362), the value of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, approved by the director and the authority pursuant to
subsection a. of this section and pursuant to subsection a. of section 2 of
P.L.2018, c.56 (C.54A:4-12b) to New Jersey studio partners shall not exceed a
cumulative total of $100,000,000 in fiscal year 2021 and in each fiscal year
thereafter prior to fiscal year 2024, and shall not exceed a cumulative total
of $150,000,000 in fiscal year 2024 and in each fiscal year thereafter prior to
fiscal year 2050, to apply against the tax imposed pursuant to section 5 of
P.L.1945, c.162 (C.54:10A-5) and the tax imposed pursuant to the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.�
[
Beginning in
fiscal year 2023, in
]

In
addition to the cumulative total tax credits made available for New
Jersey studio partners pursuant to this paragraph and subsection d. of section
98 of P.L.2020, c.156 (C.34:1B-362), up to an additional $400,000,000 may be
made available annually
in fiscal year 2023 through fiscal year 2026, and up
to an additional $380,000,000 may be made available annually beginning in
fiscal year 2027
, in the discretion of the authority, to New Jersey studio
partners for the award of tax credits, including tax credits allowed through
the granting of tax credit transfer certificates, pursuant to subsection a. of
this section and subsection a. of section 2 of P.L.2018, c.56 (C.54A:4-12b),
from the funds made available pursuant to subparagraph (i) of paragraph (1) of
subsection b. of section 98 of P.L.2020, c.156 (C.34:1B-362).� In addition to
the limitation on the value of tax credits approved by the director for New
Jersey studio partners and the limitation on the value of tax credits approved
by the director for other taxpayers imposed by this paragraph, and except as
provided in section 98 of P.L.2020, c.156 (C.34:1B-362), the value of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, approved by the director and the authority pursuant to
subsection a. of this section and pursuant to subsection a. of section 2 of
P.L.2018, c.56 (C.54A:4-12b) to New Jersey film-lease production companies
shall not exceed a cumulative total of $100,000,000 in fiscal year 2021 and in
each fiscal year thereafter prior to fiscal year 2024, and shall not exceed a
cumulative total of $150,000,000 in fiscal year 2024 and in each fiscal year
thereafter prior to fiscal year 2050, to apply against the tax imposed pursuant
to section 5 of P.L.1945, c.162 (C.54:10A-5) and the tax imposed pursuant to
the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.�
Beginning in fiscal year 2023, in addition to the cumulative total tax credits
made available for New Jersey film-lease production companies pursuant to this
paragraph and subsection d. of section 98 of P.L.2020, c.156 (C.34:1B-362), up
to an additional $250,000,000 may be made available annually, in the discretion
of the authority, to New Jersey film-lease production companies for the award
of tax credits, including tax credits allowed through the granting of tax
credit transfer certificates, pursuant to subsection a. of this section and
subsection a. of section 2 of P.L.2018, c.56 (C.54A:4-12b), from the funds made
available pursuant to subparagraph (i) of paragraph (1) of subsection b. of
section 98 of P.L.2020, c.156 (C.34:1B-362).� Approvals made to New Jersey
studio partners and New Jersey film-lease production companies shall be subject
to award agreements with the authority detailing obligations of the awardee and
outcomes relating to events of default, including, but not limited to,
recapture, forfeiture, and termination, except that in the event of a recapture
of tax credits, the tax credits shall only be recaptured from the initial
recipient of the tax credits, not the purchaser or assignee of a tax credit
transfer certificate.� Notwithstanding any provision of this subsection or
other law to the contrary, if a film production company designated as a New
Jersey studio partner ceases to qualify for its designation as a New Jersey
film studio partner and becomes designated as a New Jersey film-lease partner
facility, the authority shall reduce the cumulative total amount of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, made available to New Jersey studio partners in each
fiscal year and shall increase the cumulative total amount of tax credits permitted
to be approved for New Jersey film-lease production companies in each fiscal
year by a corresponding amount pursuant to a formula established in rules
adopted by the authority which shall consider the volume of applications
submitted by New Jersey studio partners and New Jersey film-lease production
facilities, the cumulative total amount of tax credits allowed to New Jersey
studio partners and New Jersey film-lease production facilities in the prior
fiscal year, the total square footage of facility space occupied in the State
by New Jersey studio partners and New Jersey film-lease production facilities,
and any other factors that the authority deems appropriate.� Award agreements
between the authority and New Jersey studio partners shall include a requirement
for each New Jersey studio partner to occupy the production facility developed,
purchased, or leased as a condition of designation as a New Jersey studio
partner for the duration of the commitment period.� If a New Jersey studio
partner fails to occupy the production facility developed, purchased, or leased
as a condition of designation as a New Jersey studio partner for the duration
of the commitment period or otherwise fails to satisfy the conditions for
designation as a New Jersey studio partner, except for the failure to occupy
the production facility for any reason outside the control of the New Jersey
studio partner, subject to any rules the authority may determine necessary to
implement this provision, including, but not limited to, a definition of
reasons outside the control of the New Jersey studio partner, the authority may
recapture the portion of the tax credit that was only available to the taxpayer
by virtue of the taxpayer's designation as a New Jersey studio partner, and all
films for which an initial approval has been given, but for which the authority
has not approved final documentation, shall be reduced to eliminate the portion
of the tax credits only available by virtue of such designation.�
Notwithstanding any law, regulation, or rule to the contrary, in the event of a
recapture of tax credits, the tax credits shall only be recaptured from the
initial recipient of the tax credits, not the purchaser or assignee of a tax
credit transfer certificate.� The authority shall establish a non-binding,
administrative pre-certification process for potentially eligible projects.

���� If the cumulative total amount
of tax credits, and tax credit transfer certificates, allowed to taxpayers for
privilege periods or taxable years commencing during a single fiscal year under
subsection a. of this section and subsection a. of section 2 of P.L.2018, c.56
(C.54A:4-12b) exceeds the amount of tax credits available in that fiscal year,
then taxpayers who have first applied for and have not been allowed a tax
credit or tax credit transfer certificate amount for that reason shall have
their applications approved by the authority, provided the application
otherwise satisfies the requirements of this section, and shall be allowed the
amount of tax credit or tax credit transfer certificate on the first day of the
next succeeding fiscal year in which tax credits and tax credit transfer
certificates under subsection a. of this section and subsection a. of section 2
of P.L.2018, c.56 (C.54A:4-12b) are not in excess of the amount of credits
available.

���� Notwithstanding any provision
of this paragraph to the contrary, for any fiscal year in which the amount of
tax credits approved to New Jersey studio partners, New Jersey film-lease
production companies, or taxpayers other than New Jersey studio partners and
New Jersey film-lease production companies pursuant to this paragraph is less
than the cumulative total amount of tax credits permitted to be approved to
each such category, in that fiscal year, the authority shall certify the amount
of the remaining tax credits available for approval to each such category in
that fiscal year, and shall increase the cumulative total amount of tax credits
permitted to be approved for New Jersey studio partners, New Jersey film-lease
production companies, or taxpayers other than New Jersey studio partners and
New Jersey film-lease production companies in the subsequent fiscal year by the
certified amount remaining for each such category from the prior fiscal year.�
The authority shall also certify, for each fiscal year, the amount of tax
credits that were previously approved, but that the taxpayer is not able to
redeem or transfer to another taxpayer under this section, and shall increase
the cumulative total amount of tax credits permitted to be approved for New
Jersey studio partners, New Jersey film-lease production companies, or
taxpayers other than New Jersey studio partners and New Jersey film-lease
production companies in the subsequent fiscal year by the amount of tax credits
previously approved for each such category, but not subject to redemption or
transfer.� Notwithstanding any provision of this paragraph to the contrary,
beginning in fiscal year 2028, if the amount of tax credits approved to
taxpayers other than New Jersey studio partners and New Jersey film-lease
production companies pursuant to this paragraph is less than the cumulative
total amount of tax credits permitted to be approved to taxpayers other than
New Jersey studio partners and New Jersey film-lease production companies in
that fiscal year, the authority shall certify the amount of the remaining tax
credits available for approval in that fiscal year, which certified amount
shall not exceed $100,000,000 in any fiscal year, and shall increase the
cumulative total amount of tax credits permitted to be approved for New Jersey
studio partners pursuant to subsection a. of this section and subsection a. of
section 2 of P.L.2018, c.56 (C.54A:4-12b) in the next subsequent fiscal year by
the certified amount remaining for taxpayers other than New Jersey studio
partners and New Jersey film-lease production companies from the prior fiscal
year.� If the certified amount remaining from the prior fiscal year is less
than $100,000,000, then, in addition to the tax credits remaining from the
prior fiscal year, the difference between $100,000,000 and the certified amount
shall be made available to New Jersey studio partners, first from any funds
available pursuant to subparagraph (f) of paragraph (1) of subsection b. of
section 98 of P.L.2020, c.156 (C.34:1B-362), not including tax credits made
available for transformative projects, and then, if there are insufficient
funds available pursuant to subparagraph (f) of paragraph (1) of subsection b.
of section 98 of P.L.2020, c.156 (C.34:1B-362), from the tax credits allocated
in the current fiscal year to taxpayers other than New Jersey studio partners
and New Jersey film-lease production companies.

���� (2)�� The value of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, approved by the authority and the director pursuant to
subsection b. of this section and pursuant to subsection b. of section 2 of
P.L.2018, c.56 (C.54A:4-12b) shall not exceed a cumulative total of $30,000,000
in fiscal year 2019 and in each fiscal year thereafter prior to fiscal year
2050 to apply against the tax imposed pursuant to section 5 of P.L.1945, c.162
(C.54:10A-5) and the tax imposed pursuant to the "New Jersey Gross Income
Tax Act," N.J.S.54A:1-1 et seq.

���� If the total amount of tax
credits and tax credit transfer certificates allowed to taxpayers for privilege
periods or taxable years commencing during a single fiscal year under
subsection b. of this section and subsection b. of section 2 of P.L.2018, c.56
(C.54A:4-12b) exceeds the amount of tax credits available in that year, then
taxpayers who have first applied for and have not been allowed a tax credit or
tax credit transfer certificate amount for that reason shall� have their
applications approved by the authority, provided the application otherwise
satisfies the requirements of this section, and shall be allowed the amount of
tax credit or tax credit transfer certificate on the first day of the next
succeeding fiscal year in which tax credits and tax credit transfer
certificates under subsection b. of this section and subsection b. of section 2
of P.L.2018, c.56 (C.54A:4-12b) are not in excess of the amount of credits
available.

���� Beginning in the fiscal year
beginning July 1, 2024, in addition to the total amount of tax credits and tax
credit transfer certificates allowed to taxpayers for privilege periods or
taxable years commencing during a single fiscal year under subsection b. of
this section and subsection b. of section 2 of P.L.2018, c.56 (C.54A:4-12b), up
to an additional $100,000,000 may be made available, in the discretion of the
authority for the award of tax credits, including tax credits allowed through
the granting of tax credit transfer certificates, pursuant to subsection b. of
this section and subsection b. of section 2 of P.L.2018, c.56 (C.54A:4-12b),
from the funds made available to taxpayers other than New Jersey studio
partners and New Jersey film-lease production companies pursuant to paragraph
(3) of subsection d. of section 98 of P.L.2020, c.156 (C.34:1B-362).

���� Notwithstanding any provision
of this paragraph to the contrary, for any fiscal year in which the amount of
tax credits approved pursuant to this paragraph is less than the cumulative
total amount of tax credits permitted to be approved in that fiscal year, the
authority shall certify the amount of the remaining tax credits available for
approval in that fiscal year, and shall increase the cumulative total amount of
tax credits permitted to be approved in the subsequent fiscal year by the
certified amount remaining from the prior fiscal year.� The authority shall
also certify, for each fiscal year, the amount of tax credits that were
previously approved, but that the taxpayer is not able to redeem or transfer to
another taxpayer under this section, and shall increase the cumulative total
amount of tax credits permitted to be approved in the subsequent fiscal year by
the amount of tax credits previously approved, but not subject to redemption or
transfer.

���� f.���� A taxpayer shall submit
to the authority and the director a report prepared by an independent certified
public accountant licensed in this State to verify the taxpayer's tax credit
claim following the completion of the production.� A New Jersey studio partner
that makes deferred compensation payments based on work or services provided on
a production may file a supplemental report prepared by an independent
certified public accountant, pursuant to agreed-upon procedures prescribed by
the authority and the director, no later than four years after the date on
which the production concludes.� The deferred compensation payments, including
deferred compensation payments made directly to a bona fide labor union, shall
constitute qualified film production expenses as if the expenses were incurred
at the time of production, provided there are credits available and subject to
the authority's review.� The report shall be prepared by the independent
certified public accountant pursuant to agreed-upon procedures prescribed by
the authority and the director, and shall include such information and
documentation as shall be determined to be necessary by the authority and the
director to substantiate the qualified film production expenses or the
qualified digital media content production expenses of the taxpayer.� A single
report with attachments deemed necessary by the authority shall be submitted
electronically.� Upon receipt of the report, the authority and the director
shall review the findings of the independent certified public accountant's
report, and shall make a determination as to the qualified film production
expenses or the qualified digital media content production expenses of the
taxpayer.� The authority's and the director's review shall include, but shall
not be limited to: a review of all non-payroll qualified film production
expense items and non-payroll digital media content production expense items
over $20,000; a review of 100 randomly selected non-payroll qualified film
production expense items and non-payroll digital media content production
expense items that are greater than $2,500, but less than $20,000; a review of
100 randomly selected non-payroll qualified film production expense items and
non-payroll digital media content production expense items that are less than
$2,500; a review of the qualified wages for the 15 employees, independent
contractors, or loan-out companies with the highest qualified wages; and a
review of the qualified wages for 35 randomly selected employees, independent
contractors, or loan-out companies with qualified wages other than the 15
employees, independent contractors, or loan-out companies with the highest
qualified wages.� The taxpayer's qualified film production expenses and digital
media content production expenses shall be adjusted based on any discrepancies
identified for the reviewed non-payroll qualified film production expense
items, non-payroll digital media content production expense items and qualified
wages.� The taxpayer's qualified film production expenses and digital media
content production expenses also shall be adjusted based on the projection of
any discrepancies identified based on the review of randomly selected expense
items or wages pursuant to this subsection to the extent that the discrepancies
exceed one percent of the total reviewed non-payroll qualified film production
expense items, non-payroll digital media content production expense items, or
qualified wages.� The determination shall be provided in writing to the
taxpayer, and a copy of the written determination shall be included in the
filing of a return that includes a claim for a tax credit allowed pursuant to
this section.

���� g.��� A taxpayer shall
withhold from each payment to a loan out company, to an independent contractor,
or to a homeowner for the use of a personal residence an amount equal to 6.37
percent of the payment otherwise due.� The amounts withheld shall be deemed to be
withholding of liability pursuant to the "New Jersey Gross Income Tax
Act," N.J.S.54A:1-1 et seq., and the taxpayer shall be deemed to have the
rights, duties, and responsibilities of an employer pursuant to chapter 7 of
Title 54A of the New Jersey Statutes.� The director shall allocate the amounts
withheld for a taxable year to the accounts of the individuals who are
employees of a loan out company in proportion to the employee's payment by the
loan out company in connection with a trade, profession, or occupation carried
on in this State or for the rendition of personal services performed in this
State during the taxable year.� A loan out company that reports its payments to
employees in connection with a trade, profession, or occupation carried on in
this State or for the rendition of personal services performed in this State
during a taxable year shall be relieved of its duties and responsibilities as
an employer pursuant to chapter 7 of Title 54A of the New Jersey Statutes for
the taxable year for any payments relating to the payments on which the
taxpayer withheld.� Notwithstanding any provision of this section to the
contrary, qualified film production expenses and qualified digital media
content production expenses shall include any payments made by the taxpayer to
a loan out company for services performed in New Jersey by individuals who are
employees of the loan out company and whose wages and salaries are subject to
withholding, but not subject to tax under the "New Jersey Gross Income Tax
Act," N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity
agreement with another state.� Notwithstanding any provision of this section to
the contrary, deferred compensation payments made directly to a bona fide labor
union on behalf of an individual that performed services on a production that
tax under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et
seq. was not withheld shall constitute qualified film production expenses,
provided that the payment otherwise satisfies the requirements of this section.

���� h.��� As used in this section:

���� "Authority" means
the New Jersey Economic Development Authority.

���� "Business assistance or
incentive" means "business assistance or incentive" as that term
is defined pursuant to section 1 of P.L.2007, c.101 (C.54:50-39).

���� "Commission" means
the Motion Picture and Television Development Commission.

���� "Commitment period"
means, for New Jersey studio partners, the period beginning with the
commencement of the eligibility period and continuing for a minimum of 10 years
following:

���� (1) in the case of a taxpayer
developing or purchasing a production facility, the issuance of a temporary
certificate of occupancy for the production facility developed or purchased as
a condition of designation as a New Jersey studio partner; or

���� (2) in the case of a taxpayer
leasing a production facility, commencement of the lease term for the
production facility leased as a condition of designation as a New Jersey studio
partner.

���� "Digital media
content" means the following: digitally formatted and distributed content,
which content includes data or information created in analog form, but
reformatted in digital form: animation; video games; visual effects;
interactive media, including virtual, augmented, or mixed reality; content
containing text, graphics, or photographs; sound; and video.� "Digital
media content" shall not mean content offerings generated by the end user
(including postings on electronic bulletin boards and chat rooms); content
offerings comprised primarily of local news, events, weather, or local market
reports; public service content; electronic commerce platforms (such as retail
and wholesale websites); websites or content offerings that contain obscene
material as defined pursuant to N.J.S.2C:34-2 and N.J.S.2C:34-3; websites or
content that are produced or maintained primarily for private, industrial,
corporate, or institutional purposes; or digital media content acquired or
licensed by the taxpayer for distribution or incorporation into the taxpayer's
digital media content.

���� "Eligibility period"
means, with respect to New Jersey studio partners, the period in which a New
Jersey studio partner may claim a tax credit for qualified film production
expenses, including expenses that would not constitute qualified film production
expenses but for the taxpayer's designation as a New Jersey studio partner,
beginning the earlier of the commencement of the principal photography for the
New Jersey studio partner's initial film in New Jersey or, in the case of a
taxpayer developing or purchasing a production facility, at the issuance of a
temporary certificate of occupancy for the production facility developed or
purchased as a condition of designation as a New Jersey studio partner and, in
the case of a taxpayer leasing a production facility, at the commencement of
the lease term for the production facility leased as a condition of designation
as a New Jersey studio partner, and extending thereafter for a term of not less
than 10 years.

���� "Film" means a
feature film, a television series, or a television show of 22 minutes or more
in length, intended for a national audience, or a television series or a
television show of 22 minutes or more in length intended for a national or regional
audience, including, but not limited to, a game show, award show, talk show,
competition or variety show filmed before a live audience, or other gala event
filmed and produced at a nonprofit arts and cultural venue receiving State
funding.� "Film" shall not include a production featuring news,
current events, weather, and market reports or public programming, or sports
event, a production that solicits funds, a production containing obscene
material as defined under N.J.S.2C:34-2 and N.J.S.2C:34-3, or a production
primarily for private, industrial, corporate, or institutional purposes, or a
reality show, except if the production company of the reality show has obtained
a minimum four-episode order from, and is commissioned and scheduled to
premiere on, a major linear network or streaming service.� Notwithstanding any
provision of this section to the contrary, for a New Jersey studio partner,
"film" shall include an ongoing television production that relocated
to New Jersey and features news or current events, which may include
sports-themed current events programming, but shall not include a sports event,
provided that the ongoing television production relocates to a facility that is
leased or owned by the New Jersey studio partner and for which facility such
New Jersey studio partner received its designation as a New Jersey studio
partner.� "Film" shall not include an award show or other gala event
that is not filmed and produced at a nonprofit arts and cultural venue
receiving State funding.

���� "Full-time or full-time
equivalent employee" means an individual employed by the taxpayer for
consideration for at least 35 hours a week, or who renders any other standard
of service generally accepted by custom or practice as full-time or full-time
equivalent employment, whose wages are subject to withholding as provided in
the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., or
whose wages are not subject to tax under the "New Jersey Gross Income Tax
Act," N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity
agreement with another state, regardless of whether the individual is a
resident or nonresident taxpayer, or who is a partner of a taxpayer, who works
for the partnership for at least 35 hours a week, or who renders any other
standard of service generally accepted by custom or practice as full-time or
full-time equivalent employment, and whose distributive share of income, gain,
loss, or deduction, or whose guaranteed payments, or any combination thereof,
is subject to the payment of estimated taxes, as provided in the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.� "Full-time or
full-time equivalent employee" shall not include an individual who works
as an independent contractor or on a consulting basis for the taxpayer.

���� "Highly compensated
individual" means an individual who directly or indirectly receives
compensation in excess of $750,000 for the performance of services used
directly in a production.� An individual receives compensation indirectly when
the taxpayer pays a loan out company that, in turn, pays the individual for the
performance of services.

���� "Incurred in New
Jersey" means, for any application submitted after the effective date of
P.L.2018, c.56 (C.54:10A-5.39b et al.), pursuant to which a tax credit has not
been allowed prior to the effective date of P.L.2021, c.160, service performed
within New Jersey and tangible personal property used or consumed in New
Jersey.� A service is performed in New Jersey to the extent that the individual
performing the service is physically located in New Jersey while performing the
service.� Notwithstanding where the property is delivered or acquired, rented
tangible property is used or consumed in New Jersey to the extent that the
property is located in New Jersey during its use or consumption and is rented
from a vendor authorized to do business in New Jersey and the film production
company provides to the authority the vendor's information in a form and manner
prescribed by the authority.� Purchased tangible property is not used and
consumed in New Jersey unless it is purchased from a vendor authorized to do business
in New Jersey and is delivered to or acquired within New Jersey, provided,
however, that if a production is also located in another jurisdiction, the
purchased tangible property is used and consumed in New Jersey, to the extent
that the property is located in New Jersey during its use or consumption, if
the acquisition and delivery of purchased tangible property is located in
either New Jersey or another jurisdiction where the production takes place.�
Payment made to a homeowner for the use of a personal residence located in the
State for filming shall be deemed an expense incurred in New Jersey
notwithstanding the fact that such homeowner is not a vendor authorized to do
business in New Jersey, provided the taxpayer has made the withholding required
by subsection g. of this section.

���� "Independent
contractor" means an individual treated as an independent contractor for
federal and State tax purposes who is contracted with by the taxpayer for the
performance of services used directly in a production.

���� "Loan out company"
means, for applications submitted prior to the effective date of P.L.2024,
c.33, a personal service corporation or other entity with which a taxpayer
contracts for the provision of specified individual personnel, such as artists,
crew, actors, producers, or directors for the performance of services used
directly in a production and, for applications submitted on or after the
effective date of P.L.2024, c.33, a personal service corporation or other
entity authorized to do business in New Jersey that is contracted with by the
taxpayer to provide specified individual personnel, such as artists, crew,
actors, producers, or directors for the performance of services used directly
in a production.� "Loan out company" shall not include entities
contracted with by the taxpayer to provide goods or ancillary contractor
services such as catering, construction, trailers, equipment, or
transportation.

���� "New Jersey film-lease
partner facility" means:

���� (1) (a) a production facility
in New Jersey whose owner or developer has made the commitment to build, lease,
or operate a production facility of 250,000 square feet or more, including a
sound stage and production support space, such as production offices, mill
space, or a backlot, for a period of five or more successive years, as
evidenced by site plan approval or an executed redevelopment agreement with a
governmental entity for the purpose of developing a production facility of
250,000 square feet or more;

���� (b)�� a production facility
built, leased, or operated by a production company designated as a New Jersey
studio partner and which the New Jersey studio partner no longer occupies; or

���� (c)�� a portion of a
production facility owned by a New Jersey studio partner that is in excess of
the space being utilized by the New Jersey studio partner, provided the spaces
utilized and unutilized by the New Jersey studio partner both exceed 250,000
square feet.

���� (2)�� A film production
company that executes at least a 10-year lease for 250,000 square feet or more
from a New Jersey film-lease partner facility shall be eligible to be
designated as a New Jersey studio partner, provided the film production company
otherwise complies with the eligibility requirements of the program.

���� (3)�� Except for a production
facility, or portion thereof, owned, built, leased, or operated by a film
production company designated as a New Jersey studio partner by the authority
on or before the 181st day next following the effective date of P.L.2023, c.97
(C.34:1B-4.2 et al.), in order for a production facility to be designated as a
New Jersey film-lease partner facility, the owner or developer shall accept the
acquisition by the authority, at the authority's discretion, of equity in the
production facility, on commercially reasonable and customary terms and
conditions determined by the authority and the New Jersey film-lease partner
facility.� A film production facility may receive its film-lease partner
facility designation prior to executing an equity agreement with the authority
provided final approval of such agreement occurs on or before the date on which
production commences at the facility.

���� (4)�� No more than three New
Jersey production facilities may be designated as a New Jersey film-lease
partner facility, provided, however, this limitation shall not apply to
production facilities, or portions thereof, owned, built, leased, or operated
by a film production company designated as a New Jersey studio partner.

���� "New Jersey film-lease
post-production company" means a taxpayer, including any taxpayer that is
a member of a combined group pursuant to section 23 of P.L.2018, c.48
(C.54:10A-4.11) or any other entity in which the New Jersey film-lease post-production
company has a material ownership interest and a material operational role in
the production, that otherwise complies with the eligibility requirements of
the Film and Digital Media Tax Credit Program, has made a commitment to lease
or otherwise occupy production space in a New Jersey film-lease partner
facility, and satisfies the criteria of paragraph (3) of subsection b. of this
section.� If a New Jersey film-lease partner facility has not yet received a
temporary or final certificate of occupancy, a New Jersey film-lease
post-production company shall have entered into a lease or sublease with the
owner or developer of a New Jersey film-lease partner facility, which lease or
sublease shall be for not less than three years of occupancy of the New Jersey
film-lease partner facility and include at least 36,000 square feet of gross
rentable space.� For purposes of satisfying the requirements of subparagraph
(a) of paragraph (3) of subsection b. of this section, a New Jersey film-lease
post-production company may include in an application the qualified digital
media content production expenses incurred for post-production, including
visual effects activities that are performed by the New Jersey film-lease
post-production company or by a business entity in which the New Jersey
film-lease post-production company has an ownership interest of at least 51
percent.

���� In the event that the
authority determines that a New Jersey film-lease post-production company has
failed to meet the qualifications of a New Jersey film-lease post-production
company or otherwise comply with the provisions of this section, except for the
failure to occupy the New Jersey film-lease partner facility for any reason
outside the control of the New Jersey film-lease post-production company,
subject to any rules the authority may determine necessary to implement this
provision, including, but not limited to, a definition of reasons outside the
control of the New Jersey film-lease post-production company, the authority may
recapture solely from that film production company the portion of any tax
credits that had been awarded to that film production company that was only
available to the film production company by virtue of the film production
company's designation as a New Jersey film-lease post-production company,
except that the tax credits shall not be recaptured from the purchaser or assignee
of a tax credit transfer certificate, and all films for which an initial
approval has been given, but for which the authority has not approved final
documentation, shall be reduced to eliminate the portion of the tax credits
only available by virtue of such designation.� If a New Jersey film-lease
post-production company was issued a film tax credit on the basis of a lease or
sublease with a New Jersey film-lease partner facility before that facility
receives a temporary or final certificate of occupancy, and the New Jersey
film-lease post-production company fails to meet the qualifications of a New
Jersey film-lease post-production company or otherwise comply with the
applicable provisions in the definition of New Jersey film-lease
post-production company, including, but not limited to, the failure to occupy
the required amount of space at a New Jersey film-lease production facility for
the required time, the authority shall not recapture any tax credits within one
year of the date of the New Jersey film-lease post-production company's lease
with the New Jersey film-lease production facility, which the authority shall
extend for one additional year if the New Jersey film-lease production facility
commences construction as evidenced by the issuance of a building permit within
one year of the date of the New Jersey film-lease post-production company's
lease with the New Jersey film-lease production facility.

���� "New Jersey film-lease
production company" means a taxpayer, including any taxpayer that is a
member of a combined group under section 23 of P.L.2018, c.48 (C.54:10A-4.11)
or any other entity in which the film-lease production company has a material
ownership interest and has oversight of operations of the entity, as
demonstrated by the control of at least one board of director position or other
management responsibilities, or has a material operational role in the
production, that otherwise complies with the eligibility requirements of the
Film and Digital Media Tax Credit Program and has made a commitment to lease or
otherwise occupy production space in a New Jersey film-lease partner facility
and who will shoot at least 50 percent of the total principal photography shoot
days of the project within New Jersey.� In addition to the forgoing, if a New
Jersey film-lease partner facility has received a temporary or final
certificate of occupancy, a film production company shall satisfy one of the
following two criteria:� (1) the film production company shoots at least 50
percent of the total principal photography shoot days of the project within New
Jersey at the New Jersey film-lease partner facility; or (2) the qualified film
production expenses of the project for all services performed and goods used or
consumed at the New Jersey film-lease partner facility and payments made for
the use of the New Jersey film-lease partner facility equal or exceed 33
percent of the total qualified film production expenses of the project.� In
addition to the forgoing, if a New Jersey film-lease partner facility has not
yet received a temporary or final certificate of occupancy, a film production
company shall have entered into a lease or sublease with the owner or developer
of a New Jersey film-lease partner facility, which lease or sublease is for not
less than three years of occupancy of the New Jersey film-lease partner
facility and includes at least 36,000 square feet of soundstage space, and the
film production company shall have executed a contract with the owner or
developer of the New Jersey film-lease partner facility to provide production
services for films produced by the film production company in New Jersey prior
to the New Jersey film-lease partner facility's receipt of a temporary or final
certificate of occupancy.� A television series produced by a New Jersey
film-lease production company that satisfies the three-year lease requirements
under this paragraph and that commences principal photography in New Jersey prior
to the New Jersey film-lease partner facility's receipt of a temporary or final
certificate of occupancy shall remain eligible to receive the tax credits only
available to the film production company by virtue of the film production
company's designation as a New Jersey film-lease production company, provided
that the series continues production in New Jersey, the film production company
continues to satisfy the requirements of a New Jersey film-lease production
company at least through the conclusion of production of the television series
in New Jersey, and the television series continues to satisfy the requirements
for a film that commences production prior to the New Jersey film-lease partner
facility's receipt of a temporary or final certificate of occupancy.� A
"New Jersey film-lease production company" may include any other
member of a taxpayer's combined group, pursuant to section 23 of P.L.2018, c.48
(C.54:10A-4.11), any other entity in which the New Jersey film-lease production
company has a material ownership interest, or an unrelated entity principally
engaged in the production of a film or other commercial audiovisual product
with whom a designated New Jersey film-lease production company contracts to
perform film production services on its behalf such that the designated New
Jersey film-lease production company:� (1) controls such film or product during
preproduction, production, and postproduction; or (2) controls distribution
rights for the resulting film or other commercial audiovisual product, provided
that the New Jersey film-lease production company contracted with the unrelated
entity prior to qualified film production expenses being incurred.

���� In the event the authority
determines that a New Jersey film-lease production company has failed to meet
the qualifications of a New Jersey film-lease production company or otherwise
comply with the provisions of this section, except for the failure to occupy
the New Jersey film-lease partner facility for any reason outside the control
of the New Jersey film-lease production company, subject to any rules the
authority may determine necessary to implement this provision, including, but
not limited to, a definition of reasons outside the control of the New Jersey
film-lease production company, the authority may recapture solely from that
film production company the portion of any tax credits that had been awarded to
that film production company that was only available to the film production
company by virtue of the film production company's designation as a New Jersey
film-lease production company, except that the tax credits shall not be
recaptured from the purchaser or assignee of a tax credit transfer certificate,
and all films for which an initial approval has been given, but for which the
authority has not approved final documentation, shall be reduced to eliminate
the portion of the tax credits only available by virtue of such designation.�
If a New Jersey film-lease production company was issued a film tax credit on
the basis of a lease or sublease with a New Jersey film-lease partner facility
before that facility receives a temporary or final certificate of occupancy and
the New Jersey film-lease production company fails to meet the qualifications
of a New Jersey film-lease production company or otherwise comply with the
applicable provisions in the definition of New Jersey film-lease production
company, including, but not limited to, the failure to occupy the required
amount of space at a New Jersey film-lease production facility for the required
time, the authority shall not recapture any tax credits within one year of the
date of the New Jersey film-lease production company's lease with the New Jersey
film-lease production facility, which the authority shall extend for one
additional year if the New Jersey film-lease production facility commences
construction, as evidenced by the issuance of a building permit, within one
year of the date of the New Jersey film-lease production company's lease with
the New Jersey film-lease production facility.

���� "New Jersey studio
partner" means a film production company that has made a commitment to
produce films or commercial audiovisual products in New Jersey and has
developed, purchased, or executed a 10-year contract to lease a production
facility of 250,000 square feet or more, or has executed a purchase contract
with a governmental authority for the purpose of developing a production
facility of 250,000 square feet or more within 48 months from the date of
designation as a New Jersey studio partner, provided, however, the board, in
its discretion, may extend the time to execute a purchase contract for an
additional 12 months.� Effective upon designation as a New Jersey studio
partner, a film production company shall be eligible for a credit pursuant to
this section, provided the film production company otherwise complies with the
eligibility requirements of Film and Digital Media Tax Credit Program.� In the
event the authority determines that a film production company has failed to
meet the qualifications of a New Jersey studio partner or otherwise comply with
the provisions of this section, except for the failure to occupy a New Jersey
film-lease partner facility for any reason outside the control of the New
Jersey studio partner, subject to any rules the authority may determine
necessary to implement this provision, including, but not limited to, a
definition of reasons outside the control of the New Jersey studio partner, the
authority may rescind the New Jersey studio partner designation and may recapture
solely from that film production company the portion of any tax credit that had
been awarded to that film production company that was only available to the
film production company by virtue of the film production company's designation
as a New Jersey studio partner, except that the tax credits shall not be
recaptured from the purchaser or assignee of a tax credit transfer certificate,
and all films for which an initial approval has been given, but for which the
authority has not approved final documentation, shall be reduced to eliminate
the portion of the tax credits only available by virtue of such designation.�
If a New Jersey studio partner was issued a film tax credit on the basis of a
lease or sublease with a New Jersey film-lease partner facility before that
facility receives a temporary or final certificate of occupancy and the New
Jersey studio partner fails to meet the qualifications of a New Jersey studio
partner, including, but not limited to, the failure to occupy the required
amount of space at New Jersey film-lease production facility for the required
time, the authority shall not recapture any tax credits within one year of the
date of the New Jersey studio partner's lease with the New Jersey film-lease
production facility, which the authority shall extend for one additional year
if the New Jersey film-lease production facility commences construction, as
evidenced by the issuance of a building permit, within one year of the date of
the New Jersey studio partner's lease with the New Jersey film-lease production
facility.� A "New Jersey studio partner" may include any other member
of a taxpayer's combined group, pursuant to section 23 of P.L.2018, c.48
(C.54:10A-4.11), or an unrelated entity principally engaged in the production
of a film or other commercial audiovisual product with whom a designated New
Jersey studio partner contracts to perform film production services on its
behalf or for its benefit such that the designated New Jersey studio partner:�
(1) controls such film or product during pre-production, production, and
post-production; or (2) controls distribution rights for the resulting film or
other commercial audiovisual product, provided that the New Jersey studio
partner contracted with the unrelated entity prior to qualified film production
expenses being incurred.� No more than three film production companies may be
designated as a New Jersey studio partner.

���� "Partnership" means
an entity classified as a partnership for federal income tax purposes.

���� "Post-production
costs" means the costs of the phase of production of a film that follows
principal photography, in which raw footage is cut and assembled into a
finished film with sound synchronization and visual effects.

���� "Pre-production
costs" means the costs of the phase of production of a film that precedes
principal photography, in which a detailed schedule and budget for the
production is prepared, the script and location is finalized, and contracts
with vendors are negotiated.

���� "Qualified digital media
content production expenses" means an expense incurred in New Jersey for
the production of digital media content.� "Qualified digital media content
production expenses" shall include, but not be limited to: the wages and
salaries of individuals employed in the production of digital media content on
which the tax imposed by the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq. has been paid or is due and any wages and salaries of
individuals employed in the production of digital media content that are not
subject to tax under the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity agreement with
another state;� the costs of computer software and hardware, data processing,
visualization technologies, sound synchronization, editing, and the rental of
facilities and equipment; and the costs for post-production, including, but not
limited to: editing, sound design, visual effects, animation, music
composition, color grading, and mastering.� Payment made to a loan out company
or to an independent contractor shall not be deemed a "qualified digital
media content production expense" unless the payment is made in connection
with a trade, profession, or occupation carried on in this State or for the
rendition of personal services performed in this State and the taxpayer has
made the withholding required pursuant to subsection g. of this section.� For
applications submitted prior to the effective date of P.L.2024, c.33,
"qualified digital media content production expenses" shall not
include expenses incurred in marketing, promotion, advertising digital media,
or other costs not directly related to the production of digital media
content.� For applications submitted after the effective date of P.L.2024,
c.33, "qualified digital media content production expenses" shall not
include expenses incurred in marketing, promotion, or advertising digital
media; costs incurred for the design, maintenance, and hosting of websites; or
other costs not directly related to the production of digital media content.�
Costs related to the acquisition or licensing of digital media content by the
taxpayer for distribution or incorporation into the taxpayer's digital media
content, or any costs included in an application submitted to the authority,
shall not be deemed "qualified digital media content production
expenses."

���� "Qualified film
production expenses" means an expense incurred in New Jersey for the
production of a film, including pre-production costs and post-production costs
incurred in New Jersey.� "Qualified film production expenses" shall
include, but not be limited to: the wages and salaries of individuals employed
in the production of a film on which the tax imposed by the "New Jersey
Gross Income Tax Act," N.J.S.54A:1-1 et seq. has been paid or is due and
any wages and salaries of individuals employed in the production of a film that
are not subject to tax under the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity agreement with
another state; and the costs for tangible personal property used, and services
performed, directly and exclusively in the production of a film, such as
expenditures for film production facilities, props, makeup, wardrobe, film
processing, camera, sound recording, set construction, lighting, shooting,
editing, and meals.� For a New Jersey studio partner or New Jersey film-lease
production company that enters into a lease to occupy a New Jersey film-lease
partner facility for at least three years, "qualified film production
expenses" includes the following expenses incurred in the production of
the film, which expenses shall be included in a percentage proportional to the
percentage of principal photography shoot days in the State:� total production
insurance premiums paid to insurance companies doing business in New Jersey,
which premiums shall exclude payments for errors and omissions insurance; total
producer fees; and total rights fees.� However, cumulative expenses for
production insurance premiums, producer fees, and rights fees shall not exceed
seven and one-half percent of "qualified film production expenses"
for any New Jersey studio partner or New Jersey film-lease production company.�
For a New Jersey studio partner or New Jersey film-lease production company
that enters into a lease to occupy a New Jersey film-lease partner facility for
at least three years, "qualified film production expenses" includes:
the total script costs of any script written within New Jersey or the product
of the total script costs of any script written outside New Jersey and the
percentage of the principal photography shoot days in New Jersey relative to
the total principal photography shoot days for the film.� Notwithstanding the
foregoing, for any original application approved by the authority on or after
January 1, 2028 for a New Jersey studio partner or New Jersey film-lease
production company that enters into a lease to occupy a New Jersey film-lease
partner facility for at least three years, "qualified film production
expenses" shall include the total script costs of any script written
within New Jersey or the product of the total script costs of any script
written outside New Jersey and the percentage of the principal photography
shoot days in this State relative to the total principal photography shoot days
for the film, provided that the taxpayer satisfies two of the following
criteria as certified by an independent certified public accountant licensed in
this State and according to such procedures as the authority may establish:�
the taxpayer establishes a writer's skills development program with a college,
including a community college, apprentice program, university, vocational
school, or high school in this State; the taxpayer opens a writer's room in
this State at a production facility where writing support services are provided
at least in part for the film; a writer on the film is a resident of this State
for a period including at least one year prior to the commencement of principal
photography for the film in this State; the taxpayer hires one or more
researchers that are residents of this State to perform research services in
this State for the development of a script or scripts for a film; or any
alternative criteria as the authority shall provide.� Payment made to a loan
out company or to an independent contractor shall not be deemed a "qualified
film production expense" unless the payment is made in connection with a
trade, profession, or occupation carried on in this State or for the rendition
of personal services performed in this State and the taxpayer has made the
withholding required pursuant to subsection g. of this section.� Payment made
to a homeowner, who is otherwise not a vendor authorized to do business in New
Jersey, for the use of a personal residence for filming shall not be deemed a
"qualified film production expense" unless the taxpayer has made the
withholding required by subsection g. of this section.� For the purposes of
this definition, wages and salaries of individuals employed in the production
of a film shall include deferred compensation, including advances on deferred
compensation, incurred by a New Jersey studio partner, provided the New Jersey
studio partner files a supplemental report prepared by an independent certified
public accountant, pursuant to agreed-upon procedures prescribed by the
authority and the director, no later than four years after the date on which
the production concludes.� "Qualified film production expenses" shall
not include: expenses incurred in marketing or advertising a film; expenses for
a story, script, or scenario to be used for a film, except that qualified film
production expenses may include script costs, including the cost of script
purchase, for a New Jersey studio partner or New Jersey film-lease production
company; and payment in excess of $750,000 to a highly compensated individual
for wages or salaries or other compensation for writers, directors, including
music directors, producers, and performers, other than background actors with
no scripted lines, except as follows:

���� (1) for a New Jersey studio
partner that incurs less than $25,000,000 in qualified film production expenses
in the State, which shall be determined by including the additional amount
provided in this paragraph, in excess of amounts paid to highly compensated
individuals, an additional amount, not to exceed $18,000,000, of the wages or
salaries or other compensation for writers, directors, including music
directors, producers, and performers, other than background actors with no
scripted lines, shall constitute qualified film production expenses;

���� (2)�� (Deleted by amendment,
P.L.2023, c.97)

���� (3)�� (Deleted by amendment,
P.L.2023, c.97)

���� (4)�� (a) for a New Jersey
studio partner that incurs $25,000,000 or more in qualified film production
expenses in the State, which shall be determined by including the additional
amount provided in this paragraph, in excess of amounts paid to highly
compensated individuals, an additional amount, not to exceed $72,000,000, of
the wages or salaries or other compensation for writers, directors, including
music directors, producers, and performers, other than background actors with
no scripted lines, shall constitute qualified film production expenses; and

���� (b)�� for a New Jersey studio
partner that incurs $125,000,000 or more in qualified film production expenses
in the State, which shall be determined by including the additional amount
provided in this paragraph, for the production of a film that is a feature film,
in excess of the amounts paid to highly compensated individuals, amounts paid
for script costs, amounts paid or incurred for deferred compensation, including
advances on deferred compensation, an additional amount, not to exceed
$72,000,000, of the wages and salaries or other compensation for writers,
directors, including music directors, producers, and performers, other than
background actors with no scripted lines, shall constitute qualified film
production expenses;

���� (5)�� for a New Jersey
film-lease production company that incurs less than $50,000,000 in qualified
film production expenses in the State, which shall be determined by including
the additional amount provided in this paragraph, in excess of amounts paid to
highly compensated individuals, an additional amount, not to exceed
$15,000,000, of the wages or salaries or other compensation for writers,
directors, including music directors, producers, and performers, other than
background actors with no scripted lines, shall constitute qualified film
production expenses; and

���� (6)�� for a New Jersey
film-lease production company that incurs $50,000,000 or more in qualified film
production expenses in the State, which shall be determined by including the
additional amount provided in this paragraph, in excess of amounts paid to
highly compensated individuals, an additional amount, not to exceed
$60,000,000, of the wages or salaries or other compensation for writers,
directors, including music directors, producers, and performers, other than
background actors with no scripted lines, shall constitute qualified film
production expenses.

���� "Qualified
post-production company" means a corporation, partnership, limited
liability company, or other entity engaged in post-production, including visual
effects activities on a film or films described in this section, including, but
not limited to, a film or films that do not satisfy the requirements of
subparagraph (a) of paragraph (1) of subsection a. of this section.

���� "Total digital media
content production expenses" means costs for services performed and
property used or consumed in the production of digital media content.

���� "Total film production
expenses" means costs for services performed and tangible personal
property used or consumed in the production of a film.

���� i.���� A business that is not
a "taxpayer" as defined and used in the "Corporation Business
Tax Act (1945)," P.L.1945, c.162 (C.54:10A-1 et seq.) and therefore is not
directly allowed a credit under this section, but is a business entity that is
classified as a partnership for federal income tax purposes and is ultimately
owned by a business entity that is a "corporation" as defined in
subsection (c) of section 4 of P.L.1945, c.162 (C.54:10A-4), or a limited
liability company formed under the "Revised Uniform Limited Liability
Company Act," P.L.2012, c.50 (C.42:2C-1 et seq.), or qualified to do
business in this State as a foreign limited liability company, with one member,
and is wholly owned by the business entity that is a "corporation" as
defined in subsection (c) of section 4 of P.L.1945, c.162 (C.54:10A-4), but
otherwise meets all other requirements of this section, shall be considered an
eligible applicant and "taxpayer" as that term is used in this
section.

(cf: P.L.2025, c.81, s.1)

���� 2.��� Section 2 of P.L.2018,
c.56 (C.54A:4-12b) is amended to read as follows:

���� 2. a. (1) A taxpayer, upon
approval of an application to the authority and the director, shall be allowed
a credit against the tax otherwise due for the taxable year under the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in an amount equal
to, in the case of a taxpayer designated as a New Jersey studio partner or New
Jersey film-lease production company, 40 percent, and in the case of a taxpayer
other than a New Jersey studio partner or New Jersey film-lease production
company, 35 percent, of the qualified film production expenses of the taxpayer
during a taxable year commencing on or after July 1, 2018 but before July 1,
2049, provided that:

���� (a)�� at least 60 percent of
the total film production expenses, exclusive of post-production costs, of the
taxpayer are incurred for services performed and goods purchased through
vendors authorized to do business in New Jersey or the qualified film production
expenses of the taxpayer during the taxable year for services performed and
goods purchased through vendors authorized to do business in New Jersey exceed
$1,000,000 per production;

���� (b)�� principal photography of
the film commences within 180 days from the date of the original application
for the tax credit;

���� (c)�� the film includes, when
determined to be appropriate by the commission, at no cost to the State,
marketing materials promoting this State as a film and entertainment production
destination, which materials shall include placement of a "Filmed in New
Jersey" or "Produced in New Jersey" statement, or an appropriate
logo approved by the commission, in the end credits of the film;

���� (d)�� the taxpayer submits a
tax credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection g. of this
section; and

���� (e)�� the taxpayer complies
with the withholding requirements provided for payments to loan out companies
and independent contractors in accordance with subsection h. of this section.

���� (2)�� Notwithstanding the
provisions of paragraph (1) of subsection a. of this section to the contrary,
the tax credit allowed pursuant to this subsection against the tax otherwise
due for the taxable year under the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq., shall be in an amount equal to, in the case of a
taxpayer designated as a New Jersey studio partner, 40 percent, in the case of
a taxpayer designated as a New Jersey film-lease production company, 35
percent, and in the case of a taxpayer other than a New Jersey studio partner
or New Jersey film-lease production company, 30 percent, of the qualified film
production expenses of the taxpayer during a taxable year that are incurred for
services performed and tangible personal property purchased for use at a sound
stage or other location that is located in the State within a 30-mile radius of
the intersection of Eighth Avenue/Central Park West, Broadway, and West 59th
Street/Central Park South, New York, New York.

���� b. (1) A taxpayer, upon
approval of an application to the authority and the director, shall be allowed
a credit against the tax otherwise due for the taxable year under the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., in an amount equal
to: 30 percent of the qualified digital media content production expenses of
the taxpayer during a taxable year commencing on or after July 1, 2018 but
before July 1, 2049, provided that:

���� (a) at least $2,000,000 of the
total digital media content production expenses of the taxpayer are incurred
for services performed and goods purchased through vendors authorized to do
business in New Jersey, provided, however, that for applications submitted
after the effective date of P.L.2024, c.33, qualified wage and salary payments
made to full-time employees working on digital media shall not be deemed an
expense incurred for services performed;

���� (b) at least 50 percent of the
qualified digital media content production expenses of the taxpayer are for
wages and salaries paid to full-time or full-time equivalent employees in New
Jersey;

���� (c) the taxpayer submits a tax
credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection g. of this
section; and

���� (d) the taxpayer complies with
the withholding requirements provided for payments to loan out companies and
independent contractors in accordance with subsection h. of this section.

���� (2) Notwithstanding the
provisions of paragraph (1) of subsection b. of this section to the contrary,
the tax credit allowed pursuant to this subsection against the tax otherwise
due for the taxable year under the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq., shall be in an amount equal to 35 percent of the
qualified digital media content production expenses of the taxpayer during a
taxable year that are incurred for services performed and tangible personal
property purchased through vendors whose primary place of business is located
in Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Mercer, or
Salem County.

���� (3) Notwithstanding the
provisions of paragraph (1) of this subsection to the contrary, the tax credit
allowed pursuant to this subsection against the tax otherwise due for the
taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1
et seq., shall be in an amount equal to 40 percent of the qualified digital
media content production expenses of the taxpayer during a taxable year that
are incurred for post-production services, including visual effects services
performed at a New Jersey film-lease partner facility, that are incurred by a
taxpayer that is a New Jersey film-lease post-production company, or that are
incurred by a taxpayer that is a New Jersey studio partner, provided that:

���� (a) at least $500,000 of the
qualified digital media content production expenses are incurred for
post-production services, including visual effects services performed at a New
Jersey film-lease partner facility, are incurred by a taxpayer that is a New Jersey
film-lease post-production company, or are incurred by a taxpayer that is a New
Jersey studio partner;

���� (b) the taxpayer submits a tax
credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection g. of this
section; and

���� (c)�� the taxpayer complies
with the withholding requirements provided for payments to loan out companies
and independent contractors in accordance with subsection h. of this section.

���� (4) Notwithstanding the
provisions of paragraph (1) of this subsection to the contrary, the tax credit
allowed pursuant to this subsection against the tax otherwise due for the
taxable year under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1
et seq., shall be in an amount equal to 35 percent of the qualified digital
media content production expenses of the taxpayer during a taxable year that
are incurred for post-production services, including visual effects services
performed by a qualified post-production company, provided that:

���� (a) at least $500,000 of the
qualified digital media content production expenses of the taxpayer are
incurred for post-production services, including visual effects services
performed by a taxpayer that is a qualified post-production company, which may
include qualified digital media content production expenses incurred for
post-production, including visual effects activities performed by a business
entity in which the qualified post-production company has an ownership interest
of at least 51 percent;

���� (b) the taxpayer submits a tax
credit verification report prepared by an independent certified public
accountant licensed in this State in accordance with subsection g. of this
section; and

���� (c) the taxpayer complies with
the withholding requirements provided for payments to loan out companies and
independent contractors in accordance with subsection h. of this section.

���� c.���� No tax credit shall be
allowed pursuant to this section for any costs or expenses included in the
calculation of any other tax credit or exemption granted pursuant to a claim
made on a tax return filed with the director, or included in the calculation of
an award of business assistance or incentive, for a period of time that
coincides with the taxable year for which a tax credit authorized pursuant to
this section is allowed.� The order of priority in which the tax credit allowed
pursuant to this section and any other tax credits allowed by law may be taken
shall be as prescribed by the director. The amount of the tax credit applied
under this section against the tax otherwise due under the "New Jersey
Gross Income Tax Act," N.J.S.54A:1-1 et seq., for a taxable year, when
taken together with any other payments, credits, deductions, and adjustments
allowed by law shall not reduce the tax liability of the taxpayer to an amount
less than zero.� The amount of the tax credit otherwise allowable under this
section which cannot be applied for the taxable year due to the limitations of
this subsection or under other provisions of N.J.S.54A:1-1 et seq., may be
carried forward, if necessary, to the seven taxable years following the taxable
year for which the tax credit was allowed.

���� d. (1) A business entity that
is classified as a partnership for federal income tax purposes shall not be
allowed a tax credit pursuant to this section directly, but the amount of tax
credit of a taxpayer in respect of a distributive share of entity income, shall
be determined by allocating to the taxpayer that proportion of the tax credit
acquired by the entity that is equal to the taxpayer's share, whether or not
distributed, of the total distributive income or gain of the entity for its
taxable year ending within or with the taxpayer's taxable year.

���� (2)�� A New Jersey S
Corporation shall not be allowed a tax credit pursuant to this section
directly, but the amount of tax credit of a taxpayer in respect of a pro rata
share of S Corporation income, shall be determined by allocating to the
taxpayer that proportion of the tax credit acquired by the New Jersey S
Corporation that is equal to the taxpayer's share, whether or not distributed,
of the total pro rata share of S Corporation income of the New Jersey S
Corporation for its privilege period ending within or with the taxpayer's
taxable year.

���� A business entity that is not
a gross income "taxpayer" as defined and used in the "New Jersey
Gross Income Tax Act," N.J.S.54A:1-1 et seq., and therefore is not
directly allowed a credit under this section, but otherwise meets all the other
requirements of this section, shall be considered an eligible applicant and
"taxpayer" as that term is used in this section, and the application
of an otherwise allowed credit amount shall be distributed to appropriate gross
income taxpayers pursuant to the other requirements of this subsection.

���� e.���� (1) A taxpayer, with an
application for a tax credit provided for in subsection a. or subsection b. of
this section, may apply to the authority and the director for a tax credit
transfer certificate in lieu of the taxpayer being allowed any amount of the
tax credit against the tax liability of the taxpayer.� The tax credit transfer
certificate, upon receipt thereof by the taxpayer from the authority and the
director, may be sold or assigned, in full or in part, to any other taxpayer
that may have a tax liability under the "New Jersey Gross Income Tax
Act," N.J.S.54A:1-1 et seq., the "Corporation Business Tax Act
(1945)," P.L.1945, c.162 (C.54:10A-1 et seq.), sections 2 and 3 of
P.L.1945, c.132 (C.54:18A-2 and C.54A:18A-3), section 1 of P.L.1950, c.231
(C.17:32-15), or N.J.S.17B:23-5, in exchange for private financial assistance
to be provided by the purchaser or assignee to the taxpayer that has applied
for and been granted the tax credit. The tax credit transfer certificate
provided to the taxpayer shall include a statement waiving the taxpayer's right
to claim that amount of the tax credit against the tax imposed pursuant to
N.J.S.54A:1-1 et seq. that the taxpayer has elected to sell or assign.� The
sale or assignment of any amount of a tax credit transfer certificate allowed
under this section shall not be exchanged for consideration received by the
taxpayer of less than 75 percent of the transferred tax credit amount.� Any
amount of a tax credit transfer certificate used by a purchaser or assignee
against a tax liability under N.J.S.54A:1-1 et seq. shall be subject to the
same limitations and conditions that apply to the use of a tax credit pursuant
to subsections c. and d. of this section.� Any amount of a tax credit transfer
certificate obtained by a purchaser or assignee under subsection e. of this
section may be applied against the purchaser's or assignee's tax liability
under P.L.1945, c.162 (C.54:10A-1 et seq.), sections 2 and 3 of P.L.1945, c.132
(C.54:18A-2 and C.54A:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15), or
N.J.S.17B:23-5 shall be subject to the same limitations and conditions that
apply to the use of a credit pursuant to subsection c. of section 1 of
P.L.2018, c.56 (C.54:10A-5.39b).

���� (2)�� A credit issued to a
taxpayer, including the purchaser or assignee of a tax credit transfer
certificate, may first be taken by the tax certificate holder for the tax
period for which it was issued, for the tax period in which it was issued, or
in any tax period during the time a business is required to maintain the
project at a location in this State, subject to the carryforward provisions of
this section.� The tax credit transfer certificate holder may transfer the tax
credit amount on or after the date of issuance for use by the transferee in the
tax period for which it was issued, in the tax period for which it was issued,
or in any of the next successive tax periods, subject to the carryforward
provisions of this section.� The tax certificate holder or transferee may first
use the credit against tax liabilities in the tax period in which it was issued
or in a succeeding tax period, as authorized in this paragraph, subject to the
carryforward provisions in this section, without the need to amend the return
for the year for which the credit was issued.

���� f. (1) The value of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, approved by the director and the authority pursuant to
subsection a. of this section and pursuant to subsection a. of section 1 of P.L.2018,
c.56 (C.54:10A-5.39b), and except as provided in section 98 of P.L.2020, c.156
(C.34:1B-362), to taxpayers, other than New Jersey studio partners and New
Jersey film-lease production companies, shall not exceed a cumulative total of
$100,000,000 in fiscal year 2019 and in each fiscal year thereafter prior to
fiscal year 2050 to apply against the tax imposed pursuant to the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., and pursuant to
section 5 of P.L.1945, c.162 (C.54:10A-5).� In addition to the limitation on
the value of tax credits approved by the director for New Jersey film-lease
production companies and the limitation on the value of tax credits approved by
the director for other taxpayers imposed by this paragraph, and except as provided
in section 98 of P.L.2020, c.156 (C.34:1B-362), the value of tax credits,
including tax credits allowed through the granting of tax credit transfer
certificates, approved by the director and the authority pursuant to subsection
a. of this section and pursuant to subsection a. of section 1 of P.L.2018, c.56
(C.54:10A-5.39b) to New Jersey studio partners shall not exceed a cumulative
total of $100,000,000 in fiscal year 2021 and in each fiscal year thereafter
prior to fiscal year 2024, and shall not exceed a cumulative total of
$150,000,000 in fiscal year 2024 and in each fiscal year thereafter prior to
fiscal year 2050, to apply against the tax imposed pursuant to section 5 of
P.L.1945, c.162 (C.54:10A-5) and the tax imposed pursuant to the "New Jersey
Gross Income Tax Act," N.J.S.54A:1-1 et seq.�
[
Beginning in fiscal year 2023, in
]

In

addition to the cumulative total tax credits made available for New Jersey
studio partners pursuant to this paragraph and subsection d. of section 98 of
P.L.2020, c.156 (C.34:1B-362), up to an additional $400,000,000 may be made
available annually
in fiscal year 2023 through fiscal year 2026, and up to
an additional $380,000,000 may be made available annually beginning in fiscal
year 2027
, in the discretion of the authority, to New Jersey studio
partners for the award of tax credits, including tax credits allowed through
the granting of tax credit transfer certificates, pursuant to subsection a. of
this section and subsection a. of section 1 of P.L.2018, c.56 (C.54:10A-5.39b),
from the funds made available pursuant to subparagraph (i) of paragraph (1) of
subsection b. of section 98 of P.L.2020, c.156 (C.34:1B-362).� In addition to
the limitation on the value of tax credits approved by the director for New
Jersey studio partners and the limitation on the value of tax credits approved
by the director for other taxpayers imposed by this paragraph, and except as
provided in section 98 of P.L.2020, c.156 (C.34:1B-362), the value of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, approved by the director and the authority pursuant to
subsection a. of this section and pursuant to subsection a. of section 1 of
P.L.2018, c.56 (C.54:10A-5.39b) to New Jersey film-lease production companies
shall not exceed a cumulative total of $100,000,000 in fiscal year 2021 and in
each fiscal year thereafter prior to fiscal year 2024, and shall not exceed a
cumulative total of $150,000,000 in fiscal year 2024 and in each fiscal year
thereafter prior to fiscal year 2050, to apply against the tax imposed pursuant
to section 5 of P.L.1945, c.162 (C.54:10A-5) and the tax imposed pursuant to
the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.�
Beginning in fiscal year 2023, in addition to the cumulative total tax credits
made available for New Jersey film-lease production companies pursuant to this
paragraph and subsection d. of section 98 of P.L.2020, c.156 (C.34:1B-362), up
to an additional $250,000,000 may be made available annually, in the discretion
of the authority, to New Jersey film-lease production companies for the award
of tax credits, including tax credits allowed through the granting of tax
credit transfer certificates, pursuant to subsection a. of this section and
subsection a. of section 1 of P.L.2018, c.56 (C.54:10A-5.39b), from the funds
made available pursuant to subparagraph (i) of paragraph (1) of subsection b.
of section 98 of P.L.2020, c.156 (C.34:1B-362).� Approvals made to New Jersey
studio partners and New Jersey film-lease production companies shall be subject
to award agreements with the authority detailing obligations of the awardee and
outcomes relating to events of default, including, but not limited to,
recapture, forfeiture, and termination, except that in the event of a recapture
of tax credits, the tax credits shall only be recaptured from the initial
recipient of the tax credits, not the purchaser or assignee of a tax credit
transfer certificate.� Notwithstanding any provision of this subsection or
other law to the contrary, if a film production company designated as a New
Jersey studio partner ceases to qualify for its designation as a New Jersey
film studio partner and becomes designated as a New Jersey film-lease partner
facility, the authority shall reduce the cumulative total amount of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, made available to New Jersey studio partners in each
fiscal year and shall increase the cumulative total amount of tax credits permitted
to be approved for New Jersey film-lease production companies in each fiscal
year by a corresponding amount pursuant to a formula established in rules
adopted by the authority which shall consider the volume of applications
submitted by New Jersey studio partners and New Jersey film-lease production
facilities, the cumulative total amount of tax credits allowed to New Jersey
studio partners and New Jersey film-lease production facilities in the prior
fiscal year, the total square footage of facility space occupied in the State
by New Jersey studio partners and New Jersey film-lease production facilities,
and any other factors that the authority deems appropriate.� Award agreements
between the authority and New Jersey studio partners shall include a requirement
for each New Jersey studio partner to occupy the production facility developed,
purchased, or leased as a condition of designation as a New Jersey studio
partner for the duration of the commitment period.� If a New Jersey studio
partner fails to occupy the production facility developed, purchased, or leased
as a condition of designation as a New Jersey studio partner for the duration
of the commitment period or otherwise fails to satisfy the conditions for
designation as a New Jersey studio partner, except for the failure to occupy
the production facility for any reason outside the control of the New Jersey
studio partner, subject to any rules the authority may determine necessary to
implement this provision, including, but not limited to, a definition of
reasons outside the control of the New Jersey studio partner, the authority may
recapture the portion of the tax credit that was only available to the taxpayer
by virtue of the taxpayer's designation as a New Jersey studio partner, and all
films for which an initial approval has been given, but for which the authority
has not approved final documentation, shall be reduced to eliminate the portion
of the tax credits only available by virtue of such designation.�
Notwithstanding any law, regulation, or rule to the contrary, in the event of a
recapture of tax credits, the tax credits shall only be recaptured from the
initial recipient of the tax credits, not the purchaser or assignee of a tax
credit transfer certificate.� The authority shall establish a non-binding,
administrative pre-certification process for potentially eligible projects.

���� If the cumulative total amount
of tax credits, and tax credit transfer certificates, allowed to taxpayers for
taxable years or privilege periods commencing during a single fiscal year under
subsection a. of this section and subsection a. of section 1 of P.L.2018, c.56
(C.54:10A-5.39b) exceeds the amount of tax credits available in that fiscal
year, then taxpayers who have first applied for and have not been allowed a tax
credit or tax credit transfer certificate amount for that reason shall have
their applications approved by the authority, provided the application
otherwise satisfies the requirements of this section, and shall be allowed the
amount of tax credit or tax credit transfer certificate on the first day of the
next succeeding fiscal year in which tax credits and tax credit transfer
certificates under subsection a. of this section and subsection a. of section 1
of P.L.2018, c.56 (C.54:10A-5.39b) are not in excess of the amount of credits
available.

���� Notwithstanding any provision
of this paragraph to the contrary, for any fiscal year in which the amount of
tax credits approved to New Jersey studio partners, New Jersey film-lease
production companies, or taxpayers other than New Jersey studio partners and
New Jersey film-lease production companies pursuant to this paragraph is less
than the cumulative total amount of tax credits permitted to be approved to
each such category in that fiscal year, the authority shall certify the amount
of the remaining tax credits available for approval to each such category in
that fiscal year, and shall increase the cumulative total amount of tax credits
permitted to be approved for New Jersey studio partners, New Jersey film-lease
production companies, or taxpayers other than New Jersey studio partners and
New Jersey film-lease production companies in the subsequent fiscal year by the
certified amount remaining from the prior fiscal year.� The authority shall
also certify, for each fiscal year, the amount of tax credits that were
previously approved, but that the taxpayer is not able to redeem or transfer to
another taxpayer under this section, and shall increase the cumulative total
amount of tax credits permitted to be approved for New Jersey studio partners,
New Jersey film-lease production companies, or taxpayers other than New Jersey
studio partners and New Jersey film-lease production companies in the
subsequent fiscal year by the amount of tax credits previously approved for
each such category, but not subject to redemption or transfer.� Notwithstanding
any provision of this paragraph to the contrary, beginning in fiscal year 2028,
if the amount of tax credits approved to taxpayers other than New Jersey studio
partners and New Jersey film-lease production companies pursuant to this
paragraph is less than the cumulative total amount of tax credits permitted to
be approved to taxpayers other than New Jersey studio partners and New Jersey
film-lease production companies in that fiscal year, the authority shall certify
the amount of the remaining tax credits available for approval in that fiscal
year, which certified amount shall not exceed $100,000,000 in any fiscal year,
and shall increase the cumulative total amount of tax credits permitted to be
approved for New Jersey studio partners pursuant to subsection a. of this
section and subsection a. of section 1 of P.L.2018, c.56 (C.54:10A-5.39b) in
the next subsequent fiscal year by the certified amount remaining for taxpayers
other than New Jersey studio partners and New Jersey film-lease production
companies from the prior fiscal year.� If the certified amount remaining from
the prior fiscal year is less than $100,000,000, then, in addition to the tax
credits remaining from the prior fiscal year, the difference between $100,000,000
and the certified amount shall be made available to New Jersey studio partners,
first from any funds available pursuant to subparagraph (f) of paragraph (1) of
subsection b. of section 98 of P.L.2020, c.156 (C.34:1B-362), not including tax
credits made available for transformative projects, and then, if there are
insufficient funds available pursuant to subparagraph (f) of paragraph (1) of
subsection b. of section 98 of P.L.2020, c.156 (C.34:1B-362), from the tax
credits allocated in the current fiscal year to taxpayers other than New Jersey
studio partners and New Jersey film-lease production companies.

���� (2)�� The value of tax
credits, including tax credits allowed through the granting of tax credit
transfer certificates, approved by the authority and the director pursuant to
subsection b. of this section and pursuant to subsection b. of section 1 of
P.L.2018, c.56 (C.54:10A-5.39b) shall not exceed a cumulative total of
$30,000,000 in fiscal year 2019 and in each fiscal year thereafter prior to
fiscal year 2050 to apply against the tax imposed pursuant to the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq. and the tax imposed
pursuant to section 5 of P.L.1945, c.162 (C.54:10A-5).

���� If the total amount of tax
credits and tax credit transfer certificates allowed to taxpayers for taxable
years or privilege periods commencing during a single fiscal year under
subsection b. of this section and subsection b. of section 1 of P.L.2018, c.56
(C.54:10A-5.39b) exceeds the amount of tax credits available in that year, then
taxpayers who have first applied for and have not been allowed a tax credit or
tax credit transfer certificate amount for that reason shall have their
applications approved by the authority, provided the application otherwise
satisfies the requirements of this section, and shall be allowed the amount of
tax credit or tax credit transfer certificate on the first day of the next
succeeding fiscal year in which tax credits and tax credit transfer
certificates under subsection b. of this section and subsection b. of section 1
of P.L.2018, c.56 (C.54:10A-5.39b) are not in excess of the amount of credits
available.

���� Beginning in the fiscal year
beginning July 1, 2024, in addition to the total amount of tax credits and tax
credit transfer certificates allowed to taxpayers for privilege periods or
taxable years commencing during a single fiscal year under subsection b. of
this section and subsection b. of section 1 of P.L.2018, c.56 (C.54:10A-5.39b),
up to an additional $100,000,000 may be made available, in the discretion of
the authority for the award of tax credits, including tax credits allowed
through the granting of tax credit transfer certificates, pursuant to
subsection b. of this section and subsection b. of section 1 of P.L.2018, c.56
(C.54:10A-5.39b), from the funds made available to taxpayers other than New
Jersey studio partners and New Jersey film-lease production companies pursuant
to paragraph (3) of subsection d. of section 98 of P.L.2020, c.156
(C.34:1B-362).

���� Notwithstanding any provision
of this paragraph to the contrary, for any fiscal year in which the amount of
tax credits approved pursuant to this paragraph is less than the cumulative
total amount of tax credits permitted to be approved in that fiscal year, the
authority shall certify the amount of the remaining tax credits available for
approval in that fiscal year, and shall increase the cumulative total amount of
tax credits permitted to be approved in the subsequent fiscal year by the
certified amount remaining from the prior fiscal year.� The authority shall
also certify, for each fiscal year, the amount of tax credits that were
previously approved, but that the taxpayer is not able to redeem or transfer to
another taxpayer under this section, and shall increase the cumulative total
amount of tax credits permitted to be approved in the subsequent fiscal year by
the amount of tax credits previously approved, but not subject to redemption or
transfer.

���� g.��� A taxpayer shall submit
to the authority and the director a report prepared by an independent certified
public accountant licensed in this State to verify the taxpayer's tax credit
claim following the completion of the production.� A New Jersey studio partner
that makes deferred compensation payments based on work or services provided on
a production may file a supplemental report prepared by an independent
certified public accountant, pursuant to agreed-upon procedures prescribed by
the authority and the director, no later than four years after the date on
which the production concludes.� The deferred compensation payments, including
deferred compensation payments made directly to a bona fide labor union, shall
constitute qualified film production expenses as if the expenses were incurred
at the time of production, provided there are credits available and subject to
the authority's review.� The report shall be prepared by the independent
certified public accountant pursuant to agreed-upon procedures prescribed by
the authority and the director, and shall include such information and
documentation as shall be determined to be necessary by the authority and the
director to substantiate the qualified film production expenses or the
qualified digital media content production expenses of the taxpayer.� A single
report with attachments deemed necessary by the authority shall be submitted
electronically.� Upon receipt of the report, the authority and the director
shall review the findings of the independent certified public accountant's
report, and shall make a determination as to the qualified film production
expenses or the qualified digital media content production expenses of the
taxpayer.� The authority's and the director's review shall include, but shall
not be limited to: a review of all non-payroll qualified film production
expense items and non-payroll digital media content production expense items
over $20,000; a review of 100 randomly selected non-payroll qualified film
production expense items and non-payroll digital media content production
expense items that are greater than $2,500, but less than $20,000; a review of
100 randomly selected non-payroll qualified film production expense items and
non-payroll digital media content production expense items that are less than
$2,500; a review of the qualified wages for the 15 employees, independent
contractors, or loan-out companies with the highest qualified wages; and a
review of the qualified wages for 35 randomly selected employees, independent
contractors, or loan-out companies with qualified wages other than the 15
employees, independent contractors, or loan-out companies with the highest
qualified wages.� The taxpayer's qualified film production expenses and digital
media content production expenses shall be adjusted based on any discrepancies
identified for the reviewed non-payroll qualified film production expense
items, non-payroll digital media content production expense items and qualified
wages.� The taxpayer's qualified film production expenses and digital media
content production expenses also shall be adjusted based on the projection of
any discrepancies identified based on the review of randomly selected expense
items or wages pursuant to this subsection to the extent that the discrepancies
exceed one percent of the total reviewed non-payroll qualified film production
expense items, non-payroll digital media content production expense items, or
qualified wages.� The determination shall be provided in writing to the
taxpayer, and a copy of the written determination shall be included in the
filing of a return that includes a claim for a tax credit allowed pursuant to
this section.

���� h.��� A taxpayer shall
withhold from each payment to a loan out company, to an independent contractor,
or to a homeowner for the use of a personal residence an amount equal to 6.37
percent of the payment otherwise due.� The amounts withheld shall be deemed to be
withholding of liability pursuant to the "New Jersey Gross Income Tax
Act," N.J.S.54A:1-1 et seq., and the taxpayer shall be deemed to have the
rights, duties, and responsibilities of an employer pursuant to chapter 7 of
Title 54A of the New Jersey Statutes.� The director shall allocate the amounts
withheld for a taxable year to the accounts of the individuals who are
employees of a loan out company in proportion to the employee's payment by the
loan out company in connection with a trade, profession, or occupation carried
on in this State or for the rendition of personal services performed in this
State during the taxable year.� A loan out company that reports its payments to
employees in connection with a trade, profession, or occupation carried on in
this State or for the rendition of personal services performed in this State
during a taxable year shall be relieved of its duties and responsibilities as
an employer pursuant to chapter 7 of Title 54A of the New Jersey Statutes for
the taxable year for any payments relating to the payments on which the
taxpayer withheld.� Notwithstanding any provision of this section to the
contrary, qualified film production expenses and qualified digital media
content production expenses shall include any payments made by the taxpayer to
a loan out company for services performed in New Jersey by individuals who are
employees of the loan out company and whose wages and salaries are subject to
withholding, but not subject to tax under the "New Jersey Gross Income Tax
Act," N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity
agreement with another state.� Notwithstanding any provision of this section to
the contrary, deferred compensation payments made directly to a bona fide labor
union on behalf of an individual that performed services on a production that
tax under the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et
seq. was not withheld shall constitute qualified film production expenses,
provided that the payment otherwise satisfies the requirements of this section.

���� i.���� As used in this
section:

���� "Authority" means
the New Jersey Economic Development Authority.

���� "Business assistance or
incentive" means "business assistance or incentive" as that term
is defined pursuant to section 1 of P.L.2007, c.101 (C.54:50-39).

���� "Commission" means
the Motion Picture and Television Development Commission.

���� "Commitment period"
means, for New Jersey studio partners, the period beginning with the
commencement of the eligibility period and� continuing for a minimum of 10
years following:

���� (1) in the case of a taxpayer
developing or purchasing a production facility, the issuance of a temporary
certificate of occupancy for the production facility developed or purchased as
a condition of designation as a New Jersey studio partner; or

���� (2) in the case of a taxpayer
leasing a production facility, commencement of the lease term for the
production facility leased as a condition of designation as a New Jersey studio
partner.

���� "Digital media
content" means the following digitally formatted and distributed content,
which content includes data or information created in analog form but
reformatted in digital form: animation; video games; visual effects;
interactive media, including virtual, augmented, or mixed reality; content
containing text, graphics, or photographs; sound; and video.� "Digital
media content" shall not mean content offerings generated by the end user
(including postings on electronic bulletin boards and chat rooms); content
offerings comprised primarily of local news, events, weather, or local market
reports; public service content; electronic commerce platforms (such as retail
and wholesale websites); websites or content offerings that contain obscene
material as defined pursuant to N.J.S.2C:34-2 and N.J.S.2C:34-3; websites or
content that are produced or maintained primarily for private, industrial,
corporate, or institutional purposes; or digital media content acquired or
licensed by the taxpayer for distribution or incorporation into the taxpayer's
digital media content.

���� "Eligibility period"
means, with respect to New Jersey studio partners, the period in which a New
Jersey studio partner may claim a tax credit for qualified film production
expenses, including expenses that would not constitute qualified film production
expenses but for the taxpayer's designation as a New Jersey studio partner,
beginning the earlier of the commencement of the principal photography for the
New Jersey studio partner's initial film in New Jersey or, in the case of a
taxpayer developing or purchasing a production facility, at the issuance of a
temporary certificate of occupancy for the production facility developed or
purchased as a condition of designation as a New Jersey studio partner and, in
the case of a taxpayer leasing a production facility, at the commencement of
the lease term for the production facility leased as a condition of designation
as a New Jersey studio partner, and extending thereafter for a term of not less
than 10 years.

���� "Film" means a
feature film, a television series, or a television show of 22 minutes or more
in length, intended for a national audience, or a television series or a
television show of 22 minutes or more in length intended for a national or regional
audience, including, but not limited to, a game show, award show, talk show,
competition or variety show filmed before a live audience, or other gala event
filmed and produced at a nonprofit arts and cultural venue receiving State
funding.� "Film" shall not include a production featuring news,
current events, weather, and market reports or public programming; a sports
event; a production that solicits funds; a production containing obscene
material as defined under N.J.S.2C:34-2 and N.J.S.2C:34-3; a production
primarily for private, industrial, corporate, or institutional purposes; or a
reality show, except if the production company has obtained a minimum
four-episode order from, and is commissioned and scheduled to premiere on, a
major linear network or streaming service.� Notwithstanding any provision of
this section to the contrary, for a New Jersey studio partner, "film"
shall include an ongoing television production that relocated to New Jersey and
features news or current events, which may include sports-themed current events
programming, but shall not include a sports event, provided that the ongoing
television production relocates to a facility that is leased or owned by the
New Jersey studio partner and for which facility such New Jersey studio partner
received its designation as a New Jersey studio partner.� "Film"
shall not include an award show or other gala event that is not filmed and
produced at a nonprofit arts and cultural venue receiving State funding.

���� "Full-time or full-time
equivalent employee" means an individual employed by the taxpayer for
consideration for at least 35 hours a week, or who renders any other standard
of service generally accepted by custom or practice as full-time or full-time
equivalent employment, whose wages are subject to withholding as provided in
the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., or
whose wages are not subject to tax under the "New Jersey Gross Income Tax
Act," N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity
agreement with another state, regardless of whether the individual is a
resident or nonresident taxpayer, or who is a partner of a taxpayer, who works
for the partnership for at least 35 hours a week, or who renders any other
standard of service generally accepted by custom or practice as full-time or
full-time equivalent employment, and whose distributive share of income, gain,
loss, or deduction, or whose guaranteed payments, or any combination thereof,
is subject to the payment of estimated taxes, as provided in the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq.� "Full-time or
full-time equivalent employee" shall not include an individual who works
as an independent contractor or on a consulting basis for the taxpayer.

���� "Highly compensated
individual" means an individual who directly or indirectly receives
compensation in excess of $750,000 for the performance of services used
directly in a production.� An individual receives compensation indirectly when
the taxpayer pays a loan out company that, in turn, pays the individual for the
performance of services.

���� "Incurred in New
Jersey" means, for any application submitted after the effective date of
P.L.2018, c.56 (C.54:10A-5.39b et al.), pursuant to which a tax credit has not
been allowed prior to the effective date of P.L.2021, c.160, service performed
within New Jersey and tangible personal property used or consumed in New
Jersey.� A service is performed in New Jersey to the extent that the individual
performing the service is physically located in New Jersey while performing the
service.� Notwithstanding where the property is delivered or acquired, rented
tangible property is used or consumed in New Jersey to the extent that the
property is located in New Jersey during its use or consumption and is rented
from a vendor authorized to do business in New Jersey and the film production
company provides to the authority the vendor's information in a form and manner
prescribed by the authority.� Purchased tangible property is not used and
consumed in New Jersey unless it is purchased from a vendor authorized to do business
in New Jersey and is delivered to or acquired within New Jersey, provided,
however, that if a production is also located in another jurisdiction, the
purchased tangible property is used and consumed in New Jersey, to the extent
that the property is located in New Jersey during its use or consumption, if
the acquisition and delivery of purchased tangible property is located in
either New Jersey or another jurisdiction where the production takes place.�
Payment made to a homeowner for the use of a personal residence located in the
State for filming shall be deemed an expense incurred in New Jersey
notwithstanding the fact that such homeowner is not a vendor authorized to do
business in New Jersey, provided the taxpayer has made the withholding required
by subsection h. of this section.

���� "Independent
contractor" means an individual treated as an independent contractor for
federal and State tax purposes who is contracted with by the taxpayer for the
performance of services used directly in a production.

���� "Loan out company"
means, for applications submitted prior to the effective date of P.L.2024,
c.33, a personal service corporation or other entity with which a taxpayer
contracts for the provision of specified individual personnel, such as artists,
crew, actors, producers, or directors for the performance of services used
directly in a production and, for applications submitted on or after the
effective date of P.L.2024, c.33, a personal service corporation or other
entity, authorized to do business in New Jersey, that is contracted with by the
taxpayer to provide specified individual personnel, such as artists, crew,
actors, producers, or directors for the performance of services used directly
in a production.� "Loan out company" shall not include entities
contracted with by the taxpayer to provide goods or ancillary contractor
services such as catering, construction, trailers, equipment, or
transportation.

���� "New Jersey film-lease
partner facility" means:

���� (1) (a) a production facility
in New Jersey whose owner or developer has made the commitment to build, lease,
or operate a production facility of 250,000 square feet or more, including a
sound stage and production support space, such as production offices, mill
space, or a backlot, for a period of five or more successive years, as
evidenced by site plan approval or an executed redevelopment agreement with a
governmental entity for the purpose of developing a production facility of
250,000 square feet or more;

���� (b)�� a production facility
built, leased, or operated by a production company designated as a New Jersey
studio partner and which the New Jersey studio partner no longer occupies; or

���� (c)�� a portion of a
production facility owned by a New Jersey studio partner that is in excess of
the space being utilized by the New Jersey studio partner, provided the spaces
utilized and unutilized by the New Jersey studio partner both exceed 250,000
square feet.

���� (2)�� A film production
company that executes at least a 10-year lease for 250,000 square feet or more
from a New Jersey film-lease partner facility shall be eligible to be
designated as a New Jersey studio partner, provided the film production company
otherwise complies with the eligibility requirements of the program.

���� (3)�� Except for a production
facility, or portion thereof, owned, built, leased, or operated by a film
production company designated as a New Jersey studio partner by the authority
on or before the 181st day next following the effective date of P.L.2023, c.97
(C.34:1B-4.2 et al.), in order for a production facility to be designated as a
New Jersey film-lease partner facility, the owner or developer shall accept the
acquisition by the authority, at the authority's discretion, of equity in the
production facility, on commercially reasonable and customary terms and
conditions determined by the authority and the New Jersey film-lease partner
facility.� A film production facility may receive its film-lease partner
facility designation prior to executing an equity agreement with the authority
provided final approval of such agreement occurs on or before the date on which
production commences at the facility.

���� (4)�� No more than three New
Jersey production facilities may be designated as a New Jersey film-lease
partner facility, provided, however, this limitation shall not apply to
production facilities, or portions thereof, owned, built, leased, or operated
by a film production company designated as a New Jersey studio partner.

���� "New Jersey film-lease
post-production company" means a taxpayer, including any taxpayer that is
a member of a combined group pursuant to section 23 of P.L.2018, c.48
(C.54:10A-4.11) or any other entity in which the New Jersey film-lease post-production
company has a material ownership interest and a material operational role in
the production, that otherwise complies with the eligibility requirements of
the Film and Digital Media Tax Credit Program, has made a commitment to lease
or otherwise occupy production space in a New Jersey film-lease partner
facility, and satisfies the criteria of paragraph (3) of subsection b. of this
section.� If a New Jersey film-lease partner facility has not yet received a
temporary or final certificate of occupancy, a New Jersey film-lease
post-production company shall have entered into a lease or sublease with the
owner or developer of a New Jersey film-lease partner facility, which lease or
sublease shall be for not less than three years of occupancy of the New Jersey
film-lease partner facility and include at least 36,000 square feet of gross
rentable space.� For purposes of satisfying the requirements of subparagraph
(a) of paragraph (3) of subsection b. of this section, a New Jersey film-lease
post-production company may include in an application the qualified digital
media content production expenses incurred for post-production, including
visual effects activities that are performed by the New Jersey film-lease
post-production company or by a business entity in which the New Jersey
film-lease post-production company has an ownership interest of at least 51
percent.

���� In the event that the
authority determines that a New Jersey film-lease post-production company has
failed to meet the qualifications of a New Jersey film-lease post-production
company or otherwise comply with the provisions of this section, except for the
failure to occupy the New Jersey film-lease partner facility for any reason
outside the control of the New Jersey film-lease post-production company,
subject to any rules the authority may determine necessary to implement this
provision, including, but not limited to, a definition of reasons outside the
control of the New Jersey film-lease post-production company, the authority may
recapture solely from that film production company the portion of any tax
credits that had been awarded to that film production company that was only
available to the film production company by virtue of the film production
company's designation as a New Jersey film-lease post-production company,
except that the tax credits shall not be recaptured from the purchaser or assignee
of a tax credit transfer certificate, and all films for which an initial
approval has been given, but for which the authority has not approved final
documentation, shall be reduced to eliminate the portion of the tax credits
only available by virtue of such designation.� If a New Jersey film-lease
post-production company was issued a film tax credit on the basis of a lease or
sublease with a New Jersey film-lease partner facility before that facility
receives a temporary or final certificate of occupancy, and the New Jersey
film-lease post-production company fails to meet the qualifications of a New
Jersey film-lease post-production company or otherwise comply with the
applicable provisions in the definition of New Jersey film-lease
post-production company, including, but not limited to, the failure to occupy
the required amount of space at a New Jersey film-lease production facility for
the required time, the authority shall not recapture any tax credits within one
year of the date of the New Jersey film-lease post-production company's lease
with the New Jersey film-lease production facility, which the authority shall
extend for one additional year if the New Jersey film-lease production facility
commences construction as evidenced by the issuance of a building permit within
one year of the date of the New Jersey film-lease post-production company's
lease with the New Jersey film-lease production facility.

���� "New Jersey film-lease
production company" means a taxpayer, including any taxpayer that is a
member of a combined group under section 23 of P.L.2018, c.48 (C.54:10A-4.11)
or any other entity in which the film-lease production company has a material
ownership interest and has oversight of operations of the entity, as
demonstrated by the control of at least one board of director position or other
management responsibilities, or has a material operational role in the
production, that otherwise complies with the eligibility requirements of the
Film and Digital Media Tax Credit Program and has made a commitment to lease or
otherwise occupy production space in a New Jersey film-lease partner facility
and who will shoot at least 50 percent of the total principal photography shoot
days of the project within New Jersey.� In addition to the forgoing, if a New
Jersey film-lease partner facility has received a temporary or final
certificate of occupancy, a film production company shall satisfy one of the
following two criteria:� (1) the film production company shoots at least 50
percent of the total principal photography shoot days of the project within New
Jersey at the New Jersey film-lease partner facility; or (2) the qualified film
production expenses of the project for all services performed and goods used or
consumed at the New Jersey film-lease partner facility and payments made for
the use of the New Jersey film-lease partner facility equal or exceed 33
percent of the total qualified film production expenses of the project.� In
addition to the forgoing, if a New Jersey film-lease partner facility has not
yet received a temporary or final certificate of occupancy, a film production
company shall have entered into a lease or sublease with the owner or developer
of a New Jersey film-lease partner facility, which lease or sublease is for not
less than three years of occupancy of the New Jersey film-lease partner
facility and includes at least 36,000 square feet of soundstage space, and the
film production company shall have executed a contract with the owner or
developer of the New Jersey film-lease partner facility to provide production
services for films produced by the film production company in New Jersey prior
to the New Jersey film-lease partner facility's receipt of a temporary or final
certificate of occupancy.� A television series produced by a New Jersey
film-lease production company that satisfies the three-year lease requirements
under this paragraph and that commences principal photography in New Jersey prior
to the New Jersey film-lease partner facility's receipt of a temporary or final
certificate of occupancy shall remain eligible to receive the tax credits only
available to the film production company by virtue of the film production
company's designation as a New Jersey film-lease production company, provided
that the series continues production in New Jersey, the film production company
continues to satisfy the requirements of a New Jersey film-lease production
company at least through the conclusion of production of the television series
in New Jersey, and the television series continues to satisfy the requirements
for a film that commences production prior to the New Jersey film-lease partner
facility's receipt of a temporary or final certificate of occupancy.� A
"New Jersey film-lease production company" may include any other
member of a taxpayer's combined group, pursuant to section 23 of P.L.2018, c.48
(C.54:10A-4.11), any other entity in which the New Jersey film-lease production
company has a material ownership interest, or an unrelated entity principally
engaged in the production of a film or other commercial audiovisual product
with whom a designated New Jersey film-lease production company contracts to
perform film production services on its behalf such that the designated New
Jersey film-lease production company:� (1) controls such film or product during
preproduction, production, and postproduction; or (2) controls distribution
rights for the resulting film or other commercial audiovisual product, provided
that the New Jersey film-lease production company contracted with the unrelated
entity prior to qualified film production expenses being incurred.

���� In the event the authority
determines that a New Jersey film-lease production company has failed to meet
the qualifications of a New Jersey film-lease production company or otherwise
comply with the provisions of this section, except for the failure to occupy
the New Jersey film-lease partner facility for any reason outside the control
of the New Jersey film-lease production company, subject to any rules the
authority may determine necessary to implement this provision, including, but
not limited to, a definition of reasons outside the control of the New Jersey
film-lease production company, the authority may recapture solely from that
film production company the portion of any tax credits that had been awarded to
that film production company that was only available to the film production
company by virtue of the film production company's designation as a New Jersey
film-lease production company, except that the tax credits shall not be
recaptured from the purchaser or assignee of a tax credit transfer certificate,
and all films for which an initial approval has been given, but for which the
authority has not approved final documentation, shall be reduced to eliminate
the portion of the tax credits only available by virtue of such designation.�
If a New Jersey film-lease production company was issued a film tax credit on
the basis of a lease or sublease with a New Jersey film-lease partner facility
before that facility receives a temporary or final certificate of occupancy and
the New Jersey film-lease production company fails to meet the qualifications
of a New Jersey film-lease production company or otherwise comply with the
applicable provisions in the definition of New Jersey film-lease production
company, including, but not limited to, the failure to occupy the required
amount of space at a New Jersey film-lease production facility for the required
time, the authority shall not recapture any tax credits within one year of the
date of the New Jersey film-lease production company's lease with the New Jersey
film-lease production facility, which the authority shall extend for one
additional year if the New Jersey film-lease production facility commences
construction, as evidenced by the issuance of a building permit, within one
year of the date of the New Jersey film-lease production company's lease with
the New Jersey film-lease production facility.

���� "New Jersey studio
partner" means a film production company that has made a commitment to
produce films or commercial audiovisual products in New Jersey and has
developed, purchased, or executed a 10-year contract to lease a production
facility of 250,000 square feet or more, or has executed a purchase contract
with a governmental authority for the purpose of developing a production
facility of 250,000 square feet or more within 48 months from the date of
designation as a New Jersey studio partner, provided, however, the board, in
its discretion, may extend the time to execute a purchase contract for an
additional 12 months.� Effective upon designation as a New Jersey studio
partner, a film production company shall be eligible for a credit pursuant to
this section, provided the film production company otherwise complies with the
eligibility requirements of Film and Digital Media Tax Credit Program.� In the
event the authority determines that a film production company has failed to
meet the qualifications of a New Jersey studio partner or otherwise comply with
the provisions of this section, except for the failure to occupy a New Jersey
film-lease partner facility for any reason outside the control of the New
Jersey studio partner, subject to any rules the authority may determine
necessary to implement this provision, including, but not limited to, a
definition of reasons outside the control of the New Jersey studio partner, the
authority may rescind the New Jersey studio partner designation and may recapture
solely from that film production company the portion of any tax credit that had
been awarded to that film production company that was only available to the
film production company by virtue of the film production company's designation
as a New Jersey studio partner, except that the tax credits shall not be
recaptured from the purchaser or assignee of a tax credit transfer certificate,
and all films for which an initial approval has been given, but for which the
authority has not approved final documentation, shall be reduced to eliminate
the portion of the tax credits only available by virtue of such designation.�
If a New Jersey studio partner was issued a film tax credit on the basis of a
lease or sublease with a New Jersey film-lease partner facility before that
facility receives a temporary or final certificate of occupancy and the New
Jersey studio partner fails to meet the qualifications of a New Jersey studio
partner, including, but not limited to, the failure to occupy the required
amount of space at New Jersey film-lease production facility for the required
time, the authority shall not recapture any tax credits within one year of the
date of the New Jersey studio partner's lease with the New Jersey film-lease
production facility, which the authority shall extend for one additional year
if the New Jersey film-lease production facility commences construction, as
evidenced by the issuance of a building permit, within one year of the date of
the New Jersey studio partner's lease with the New Jersey film-lease production
facility.� A "New Jersey studio partner" may include any other member
of a taxpayer's combined group, pursuant to section 23 of P.L.2018, c.48
(C.54:10A-4.11), or an unrelated entity principally engaged in the production
of a film or other commercial audiovisual product with whom a designated New
Jersey studio partner contracts to perform film production services on its
behalf or for its benefit such that the designated New Jersey studio partner:�
(1) controls such film or product during pre-production, production, and
post-production; or (2) controls distribution rights for the resulting film or
other commercial audiovisual product, provided that the New Jersey studio
partner contracted with the unrelated entity prior to qualified film production
expenses being incurred.� No more than three film production companies may be
designated as a New Jersey studio partner.

���� "Partnership" means
an entity classified as a partnership for federal income tax purposes.

���� "Post-production
costs" means the costs of the phase of production of a film that follows
principal photography, in which raw footage is cut and assembled into a
finished film with sound synchronization and visual effects.

���� "Pre-production
costs" means the costs of the phase of production of a film that precedes
principal photography, in which a detailed schedule and budget for the
production is prepared, the script and location is finalized, and contracts
with vendors are negotiated.

���� "Qualified digital media
content production expenses" means an expense incurred in New Jersey for
the production of digital media content.� "Qualified digital media content
production expenses" shall include, but not be limited to: the wages and
salaries of individuals employed in the production of digital media content on
which the tax imposed by the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq. has been paid or is due and any wages and salaries of
individuals employed in the production of digital media content that are not
subject to tax under the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity agreement with
another state; the costs of computer software and hardware, data processing,
visualization technologies, sound synchronization, editing, and the rental of
facilities and equipment; and the costs for post-production, including, but not
limited to: editing, sound design, visual effects, animation, music
composition, color grading, and mastering.� Payment made to a loan out company
or to an independent contractor shall not be deemed a "qualified digital
media content production expense" unless the payment is made in connection
with a trade, profession, or occupation carried on in this State or for the
rendition of personal services performed in this State and the taxpayer has
made the withholding required pursuant to subsection h. of this section.� For
applications submitted prior to the effective date of P.L.2024, c.33,
"qualified digital media content production expenses" shall not
include expenses incurred in marketing, promotion, advertising digital media,
or other costs not directly related to the production of digital media
content.� For applications submitted after the effective date of P.L.2024,
c.33, "qualified digital media content production expenses" shall not
include expenses incurred in marketing, promotion, or advertising digital
media; costs incurred for the design, maintenance, and hosting of websites; or
other costs not directly related to the production of digital media content.�
Costs related to the acquisition or licensing of digital media content by the
taxpayer for distribution or incorporation into the taxpayer's digital media
content, or any costs included in an application submitted to the authority,
shall not be deemed "qualified digital media content production
expenses."

���� "Qualified film
production expenses" means an expense incurred in New Jersey for the
production of a film, including pre-production costs and post-production costs
incurred in New Jersey.� "Qualified film production expenses" shall
include, but not be limited to: the wages and salaries of individuals employed
in the production of a film on which the tax imposed by the "New Jersey
Gross Income Tax Act," N.J.S.54A:1-1 et seq. has been paid or is due and
any wages and salaries of individuals employed in the production of a film that
are not subject to tax under the "New Jersey Gross Income Tax Act,"
N.J.S.54A:1-1 et seq., due to the provisions of a reciprocity agreement with
another state; and the costs for tangible personal property used, and services
performed, directly and exclusively in the production of a film, such as
expenditures for film production facilities, props, makeup, wardrobe, film
processing, camera, sound recording, set construction, lighting, shooting,
editing, and meals.� For a New Jersey studio partner or New Jersey film-lease
production company that enters into a lease to occupy a New Jersey film-lease
partner facility for at least three years, "qualified film production
expenses" includes the following expenses incurred in the production of
the film, which expenses shall be included in a percentage proportional to the
percentage of principal photography shoot days in the State:� total production
insurance premiums paid to insurance companies doing business in New Jersey,
which premiums shall exclude payments for errors and omissions insurance; total
producer fees; and total rights fees.� However, cumulative expenses for
production insurance premiums, producer fees, and rights fees shall not exceed
seven and one-half percent of "qualified film production expenses"
for any New Jersey studio partner or New Jersey film-lease production company.�
For a New Jersey studio partner or New Jersey film-lease production company
that enters into a lease to occupy a New Jersey film-lease partner facility for
at least three years, "qualified film production expenses" includes:
the total script costs of any script written within New Jersey or the product
of the total script costs of any script written outside New Jersey and the
percentage of the principal photography shoot days in New Jersey relative to
the total principal photography shoot days for the film.� Notwithstanding the
foregoing, for any original application approved by the authority on or after
January 1, 2028 for a New Jersey studio partner or New Jersey film-lease
production company that enters into a lease to occupy a New Jersey film-lease
partner facility for at least three years, "qualified film production
expenses" shall include the total script costs of any script written
within New Jersey or the product of the total script costs of any script
written outside New Jersey and the percentage of the principal photography
shoot days in this State relative to the total principal photography shoot days
for the film, provided that the taxpayer satisfies two of the following
criteria as certified by an independent certified public accountant licensed in
this State and according to such procedures as the authority may establish:�
the taxpayer establishes a writer's skills development program with a college,
including a community college, apprentice program, university, vocational
school, or high school in this State; the taxpayer opens a writer's room in
this State at a production facility where writing support services are provided
at least in part for the film; a writer on the film is a resident of this State
for a period including at least one year prior to the commencement of principal
photography for the film in this State; the taxpayer hires one or more
researchers that are residents of this State to perform research services in
this State for the development of a script or scripts for a film; or any
alternative criteria as the authority shall provide.� Payment made to a loan
out company or to an independent contractor shall not be deemed a "qualified
film production expense" unless the payment is made in connection with a
trade, profession, or occupation carried on in this State or for the rendition
of personal services performed in this State and the taxpayer has made the
withholding required by subsection h. of this section.� Payment made to a
homeowner, who is otherwise not a vendor authorized to do business in New
Jersey, for the use of a personal residence for filming shall not be deemed a
"qualified film production expense" unless the taxpayer has made the
withholding required by subsection h. of this section.� For the purposes of
this definition, wages and salaries of individuals employed in the production
of a film shall include deferred compensation, including advances on deferred
compensation, incurred by a New Jersey studio partner, provided the New Jersey
studio partner files a supplemental report prepared by an independent certified
public accountant, pursuant to agreed-upon procedures prescribed by the
authority and the director, no later than four years after the date on which
the production concludes.� "Qualified film production expenses" shall
not include: expenses incurred in marketing or advertising a film; expenses for
a story, script, or scenario to be used for a film, except that qualified film
production expenses may include script costs, including the cost of script
purchase, for a New Jersey studio partner or New Jersey film-lease production
company; and payment in excess of $750,000 to a highly compensated individual
for wages or salaries or other compensation for writers, directors, including
music directors, producers, and performers, other than background actors with
no scripted lines, except as follows:

���� (1)�� for a New Jersey studio
partner that incurs less than $25,000,000 in qualified film production expenses
in the State, which shall be determined by including the additional amount
provided in this paragraph, in excess of amounts paid to highly compensated
individuals, an additional amount, not to exceed $18,000,000, of the wages or
salaries or other compensation for writers, directors, including music
directors, producers, and performers, other than background actors with no
scripted lines, shall constitute qualified film production expenses;

���� (2)�� (Deleted by amendment,
P.L.2023, c.97)

���� (3)�� (Deleted by amendment,
P.L.2023, c.97)

���� (4)�� (a) for a New Jersey
studio partner that incurs $25,000,000 or more in qualified film production
expenses in the State, which shall be determined by including the additional
amount provided in this paragraph, in excess of amounts paid to highly
compensated individuals, an additional amount, not to exceed $72,000,000, of
the wages or salaries or other compensation for writers, directors, including
music directors, producers, and performers, other than background actors with
no scripted lines, shall constitute qualified film production expenses; and

���� (b)�� for a New Jersey studio
partner that incurs $125,000,000 or more in qualified film production expenses
in the State, which shall be determined by including the additional amount
provided in this paragraph, for the production of a film that is a feature film,
in excess of the amounts paid to highly compensated individuals, amounts paid
for script costs, amounts paid or incurred for deferred compensation, including
advances on deferred compensation, an additional amount, not to exceed
$72,000,000, of the wages and salaries or other compensation for writers,
directors, including music directors, producers, and performers, other than
background actors with no scripted lines, shall constitute qualified film
production expenses;

���� (5)�� for a New Jersey
film-lease production company that incurs less than $50,000,000 in qualified
film production expenses in the State, which shall be determined by including
the additional amount provided in this paragraph, in excess of amounts paid to
highly compensated individuals, an additional amount, not to exceed
$15,000,000, of the wages or salaries or other compensation for writers,
directors, including music directors, producers, and performers, other than
background actors with no scripted lines, shall constitute qualified film
production expenses; and

���� (6)�� for a New Jersey
film-lease production company that incurs $50,000,000 or more in qualified film
production expenses in the State, which shall be determined by including the
additional amount provided in this paragraph, in excess of amounts paid to
highly compensated individuals, an additional amount, not to exceed
$60,000,000, of the wages or salaries or other compensation for writers,
directors, including music directors, producers, and performers, other than
background actors with no scripted lines, shall constitute qualified film
production expenses.

���� "Qualified
post-production company" means a corporation, partnership, limited
liability company, or other entity engaged in post-production, including visual
effects activities on a film or films described in this section, including, but
not limited to, a film or films that do not satisfy the requirements of
subparagraph (a) of paragraph (1) of subsection a. of this section.

���� "Total digital media
content production expenses" means costs for services performed and
property used or consumed in the production of digital media content.

���� "Total film production
expenses" means costs for services performed and tangible personal
property used or consumed in the production of a film.

(cf: P.L.2025, c.81, s.2)

���� 3.��� (New section) a. In
State Fiscal Years 2027 through 2049, the New Jersey Public Broadcasting
Authority shall sell $20,000,000 in tax credits through competitive auctions,
conducted in a manner consistent with the processes set forth in section 24 of
P.L.2020, c.156 (C.34:1B-292), as determined by the New Jersey Broadcasting
Authority.� The New Jersey Public Broadcasting Authority shall not sell tax
credits for less than 80 percent of the value of the tax credits.

���� b.��� The New Jersey Public
Broadcasting Authority shall be permitted to join or be added to any contract
that the New Jersey Economic Development Authority has utilized for its
auctions, except that the auctions held for the purposes of administering
P.L. ,
c. (C. )
(pending before the Legislature as this bill) shall not be counted toward the
limitation imposed pursuant to subsection d. of section 24 of P.L.2020, c.156
(C.34:1B-292), and the requirement on purchasers under paragraph (3) of
subsection b. of section 24 of P.L.2020, c.156 (C.34:1B-292) shall not apply.

���� c.���� In each fiscal year, of
the proceeds generated from the sale of tax credits pursuant to this section,
the New Jersey Broadcasting Authority may retain the amounts necessary, not in
excess of $1,000,000, to reimburse administrative and operational costs,
including contracts necessary to hold the competitive auction required pursuant
to subsection a. of this section, which funds shall be deposited into a
nonlapsing account established and maintained by the authority for the purposes
of administering P.L. ,
c. (C. )
(pending before the Legislature as this bill).� The New Jersey Public Broadcasting
Authority shall annually allocate any remaining proceeds, in consultation with
the New Jersey Civic Information Consortium, in an amount no less than:

���� (1)�� $5,000,000 to the New
Jersey Civic Information Consortium to fund the provision of grants pursuant to
section 7 of P.L.2018, c.111 (C.18A:64-100); and

���� (2)�� $10,000,000 to the Trust
Fund for the Support of Public Broadcasting, established pursuant to section 22
of P.L.2010, c.104 (C.48:23-29).

���� 4.��� (New section) A
purchaser that submits a successful bid for the purchase of tax credits
pursuant to section 3 of P.L. , c. (C. )
(pending before the Legislature as this bill) shall enter into a contract with
the New Jersey Public Broadcasting Authority that includes payment information
and the commitments made by the purchaser in its auction bid.� A purchaser that
submits a successful bid for the purchase of tax credits pursuant to section 3
of P.L. , c. (C. )
(pending before the Legislature as this bill) shall pay by wire transfer the
amount specified in its auction bid to the authority. �Upon receipt thereof,
the Board of the New Jersey Public Broadcasting Authority shall notify the
Director of the Division of Taxation in the Department of the Treasury to issue
tax credits in the amount approved.� Failure by the purchaser to pay the amount
agreed upon on time shall disqualify the purchaser from purchasing the tax credits,
and the authority may reassign the right to purchase the tax credits to another
bidder.� Failure by the purchaser to adhere to the commitments made in its
auction bid shall disqualify the purchaser from participating in future
auctions and may result in the recapture of a portion of the tax credits.

���� 5.��� (New section) a. A
purchaser that submits a successful bid for the purchase of tax credits
pursuant to section 3 of P.L. , c. (C. ) (pending
before the Legislature as this bill) shall apply the credit against the
purchaser's State tax liability due pursuant to the "Corporation Business
Tax Act (1945)," P.L.1945, c.162 (C.54:10A-1 et seq.), the "New
Jersey Gross Income Tax

Act," N.J.S.54A:1-1 et seq., sections 2 and 3 of P.L.1945, c.132
(C.54:18A-2 and C.54A:18A-3), section 1 of P.L.1950, c.231 (C.17:32-15), or
N.J.S.17B:23-5 for the current tax period, as of the date the tax credit is
approved.� A purchaser may carry forward an unused credit resulting from the
limitations of this section, if necessary, for use in any of the seven tax
periods next following the tax period for which the credit is awarded.

���� b.��� The Director of the
Division of Taxation shall prescribe the order of priority of the application
of the credits awarded under section 3 of P.L. ,
c. (C. )
(pending before the Legislature as this bill) and any other credits allowed by
law.� The amount of a credit applied under section 3 of P.L. ,
c. (C. )
(pending before the Legislature as this bill) against the tax imposed pursuant
to section 5 of P.L.1945, c.162 (C.54:10A-5) for a privilege period, together
with any other credits allowed by law, shall not reduce the tax liability of
the purchaser to an amount less than the statutory minimum provided in subsection
(e) of section 5 of P.L.1945, c.162 (C.54:10A-5).� The amount of the tax credit
applied under this section against the tax otherwise due under the "New
Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., for a taxable year,
when taken together with any other payments, credits, deductions, and adjustments
allowed by law shall not reduce the tax liability of the taxpayer to an amount
less than zero.

���� c.���� (1) A business entity
that is classified as a partnership for federal income tax purposes shall not
be allowed a tax credit pursuant to section 3 of P.L. ,
c. (C. )
(pending before the Legislature as this bill) directly, but the amount of tax
credit of a taxpayer in respect of a distributive share of entity income, shall
be determined by allocating to the taxpayer that proportion of the tax credit
acquired by the entity that is equal to the taxpayer's share, whether or not
distributed, of the total distributive income or gain of the entity for its
taxable year ending within or with the taxpayer's taxable year.

���� (2)�� A New Jersey S
Corporation shall not be allowed a tax credit pursuant to section 3 of P.L. ,
c. (C. )
(pending before the Legislature as this bill) directly, but the amount of tax
credit of a taxpayer in respect of a pro rata share of S Corporation income,
shall be determined by allocating to the taxpayer that proportion of the tax
credit acquired by the New Jersey S Corporation that is equal to the taxpayer's
share, whether or not distributed, of the total pro rata share of S Corporation
income of the New Jersey S Corporation for its privilege period ending within
or with the taxpayer's taxable year.

���� 6.��� (New section) A
purchaser of tax credits pursuant to section 3 of P.L. ,
c. (C. )
(pending before the Legislature as this bill) may apply to the New Jersey
Public Broadcasting Authority and the Director of the Division of Taxation for
a tax credit transfer certificate in lieu of the taxpayer being allowed any
amount of the tax credit against the tax liability of the taxpayer.� The tax
credit transfer certificate, upon receipt thereof by the taxpayer from the
authority and the director, may be sold or assigned, in full or in part, to any
other taxpayer that may have a tax liability under the "Corporation
Business Tax Act (1945)," P.L.1945, c.162 (C.54:10A-1 et seq.), the
"New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., sections 2
and 3 of P.L.1945, c.132 (C.54:18A-2 and C.54A:18A-3), section 1 of P.L.1950,
c.231 (C.17:32-15), or N.J.S.17B:23-5, in exchange for private financial
assistance to be provided by the purchaser or assignee to the taxpayer that has
applied for and been granted the tax credit.� The tax credit transfer
certificate provided to the taxpayer shall include a statement waiving the
taxpayer's right to claim that amount of the tax credit that the purchaser has
elected to sell or assign.

���� b.��� The purchaser shall not
sell or assign a tax credit transfer certificate allowed under this section for
consideration received by the purchaser of less than 80 percent of the
transferred credit amount before considering any further discounting to present
value which shall be permitted.� The tax credit transfer certificate issued to
a purchaser by the director shall be subject to any limitations and conditions
imposed on the application of State tax credits pursuant to section 5 of
P.L. ,
c. (C. )
(pending before the Legislature as this bill) and any other terms and
conditions that the Director of the Division of Taxation may prescribe.

���� c.���� The transferee or
assignee may first use the credit against tax liabilities for the tax period
for which it was issued, for the tax period in which it was issued, or in any
of the next seven succeeding tax periods, without the need to amend the return
for the year for which the credit was issued.

���� d.��� A transferee or assignee
of a tax credit transfer certificate pursuant to this section shall not make
any subsequent transfers, assignments, or sales of the tax credit transfer
certificate.

���� 7.��� (New section) Notwithstanding
the provisions of the "Administrative Procedure Act," P.L.1968, c.410
(C.52:14B-1 et seq.) to the contrary, the New Jersey Public Broadcasting
Authority may adopt, immediately, upon filing with the Office of Administrative
Law, such rules and regulations as the authority deems necessary to implement
the provisions of P.L. , c. (C. )
(pending before the Legislature as this bill), which regulations shall be
effective for a period not to exceed 180 days from the date of the filing.�
Thereafter, the authority shall amend, adopt, or readopt the regulations in
accordance with the requirements of the "Administrative Procedure Act,"
P.L.1968, c.410 (C.52:14B-1 et seq.).

���� 8.��� a. There is appropriated
$5,000,000 from the General Fund to the Department of the Treasury for
distribution to the New Jersey Civic Information Consortium to fund the
provision of grants pursuant to section 7 of P.L.2018, c.111 (C.18A:64-100).

���� b.��� There is appropriated $10,000,000
from the General Fund to the Department of the Treasury for deposit into the Trust
Fund for the Support of Public Broadcasting, established pursuant to section 22
of P.L.2010, c.104 (C.48:23-29).

���� 9.��� This act shall take effect
on July 1, 2026.

STATEMENT

���� This directs the New Jersey
Public Broadcasting Authority to conduct annual tax credit auctions, valued at
$20 million, and dedicate the proceeds to fund support for civic information
and public broadcasting.� The bill also reduces the amount of tax credits
annually authorized to be awarded under the "Garden State Film and Digital
Media Jobs Act" by $20 million.

Reallocation of Discretionary Film
and Digital Media Content Production Tax Credits

���� Under current law, the New
Jersey Economic Development Authority (EDA) is authorized to award tax credits under
the film and digital media content production tax credit program established
pursuant to the "Garden State Film and Digital Media Jobs Act."� Through
State Fiscal Year 2049, the EDA is authorized under the program to award an
annual cumulative amount of film production tax credits not to exceed a value
of $150 million to New Jersey studio partners, $150 million to New Jersey
film-lease production companies, and $100 million to other taxpayers. �In
addition, current law authorizes additional annual tax credit awards, at the
discretion of the EDA, not to exceed a cumulative value of $400 million for New
Jersey studio partners and $250 million for New Jersey film-lease production
companies.

���� This bill decreases the amount
of additional, discretionary tax credits that the EDA may currently award under
the program to New Jersey studio partners by $20 million.� Accordingly, the
bill provides that beginning in State Fiscal Year 2027, the EDA may award
additional tax credits not in excess of $380 million for New Jersey studio
partners.

New Jersey Public Broadcasting
Authority Tax Credit Auction

���� This bill requires the New
Jersey Public Broadcasting Authority to annually sell $20 million tax credits through
competitive auctions, for amounts no less than 80 percent of the value of the
tax credits, in State Fiscal Years 2027 through 2049.� The tax credits
auctioned may be applied against the corporation business tax, gross income
tax, and certain taxes imposed on insurance companies.

���� Under the bill, a purchaser of
tax credits at the competitive auction may carry forward an unused credit
resulting from the limitations in the bill, if necessary, for use in any of the
seven tax periods next following the tax period for which the credit is
awarded.� A purchaser may apply for a tax credit transfer certificate in lieu
of claiming the credit.� A transferee or assignee may first use the credit
against tax liabilities for the tax period for which it was issued, for the tax
period in which it was issued, or in any of the next seven succeeding tax
periods, without the need to amend the return for the year for which the credit
was issued.

���� Of the annual proceeds
generated from the tax credit auctions, the bill permits the New Jersey Public Broadcasting
Authority to retain the amounts necessary, but not more than $1 million, to
reimburse administrative and operational costs, including contracts necessary
to hold the competitive auction.� Each year, the New Jersey Broadcasting
Authority is required to distribute any remaining proceeds, in consultation
with the New Jersey Civic Information Consortium (consortium), subject to
certain minimum distribution requirements.

���� Specifically, no less than $5
million is to be annually distributed to the consortium to fund the provision
of grants for projects that achieve the following goals: �(1) improve the
quantity and quality of civic information in New Jersey communities; (2) give
residents enhanced access to useful government data and public information
through innovative applications, platforms, and technologies; (3) train
students, professionals, and community members in the practice of community
storytelling, journalism, and media production; (4) nurture better civic engagement
and dialogue inside and between New Jersey communities; (5) better meet the
information needs of low-income communities and racial and ethnic communities
that have been underserved by the media; and (6) invest in research and
practices that can help media outlets become more closely connected to their
audiences and more sustainable without government support.

���� Additionally, no less than $10
million is to be annually allocated to the Trust Fund for the Support of Public
Broadcasting, which provides funding for the operation of a public broadcasting
system in this State.

Appropriation

���� The bill appropriates $15
million from the General Fund, including $5 million to fund the provision of
grants by the consortium, and $10 million for deposit into the Trust Fund for
the Support of Public Broadcasting.