The New Jersey Economic Development Authority was given high praise by the state auditor for its application of the New Jersey film tax credit program, a key initiative of Gov. Phil Murphy’s administration that was reestablished as the Garden State Film and Digital Media Jobs Act in the summer of 2018.
The report, prepared by state auditor David Kaschak and issued Thursday, reviewed the period of July 1, 2020, to Dec. 31, 2023 — a period in which the report said the EDA has approved 151 film and digital media projects with estimated tax credits totaling $704.9 million.
The report spoke well of the efforts by the EDA.
“We found the NJEDA had adequate controls in place to approve eligible projects, monitor the program and certify tax credits in compliance with internal requirements, applicable program criteria and the laws governing the program,” the report said.
“In making these determinations, we observed that legislation may be needed to increase the economic benefit the program provides the state. We also noted weaknesses relating to the expenditure certification process and fees collected to cover the program’s administrative costs meriting management’s attention.”
Kaschak, in the report, said the review included program eligibility for approved film and digital media projects and non-salary qualified film production expenses (qualified expenses) for certified film tax credits.
The program’s goal is to incentivize production companies to film and create digital media content in the state. This is accomplished by providing a transferable credit against the Corporation Business Tax and the Gross Income Tax for qualified expenses incurred for the production of certain film and digital media content in New Jersey.
EDA CEO Tim Sullivan obviously was thrilled by the audit.
“The results of this audit make clear that the investments we have made under Gov. Murphy’s leadership are paying off, and that the EDA is proving itself to be a strong steward of taxpayer resources,” he said.
“The governor and Legislature have invested significantly in growing the film and television industry in New Jersey, which has created thousands of jobs and attracted billions of private investment, and our taxpayers can be assured that we will remain rigorous in how those resources are being deployed. We thank the state auditor and his team for a thorough and efficient audit.”
