New Jersey is making big moves in the film industry.  With the recent groundbreaking of 1888 Studios in Bayonne, Paramount will join such media companies as Netflix and Lionsgate in adding film production in “Hollywood East,” the moniker used to describe New Jersey’s rapid business expansion in the entertainment industry.  Major recent film productions filmed in the Garden State include Steven Speilberg’s “Disclosure Day,” the Bruce Springsteen biopic, “Springsteen: Deliver Me from Nowhere,” Adam Sandler’s Netflix comedy, “Happy Gilmore 2,” and the Apple TV series, “Severance.”  Many more productions are expected soon. When 1888 Studios is complete, it will be the largest studio complex in the northeast with 23 stages.

   These opportunities come from the extension of the New Jersey Film and Digital Media Tax Credit Program through 2049.  Originating in Senate Bill 4618 and Assembly Bill 5827 and signed into law by Governor Phil Murphy on June 30, 2025 (P.L. 2025, c. 81), the program provides tax credits of up to 40% for film and digital media productions.  These incentives will go into the billions of dollars.  However, as anyone who has seen the credits of a movie is aware, a film involves hundreds of individuals and supporting businesses.  This includes construction firms, catering companies, boutique hotels, specialized tech shops, wardrobe and stylists … the list is endless.

   The program originally limited itself to large-scale productions.  However, due to changes in the law, more categories have become available for credits.  Additionally, post-production work performed by digital houses located in New Jersey, even if the production was originally filmed out of state, now qualifies. This will encourage the growth of businesses in smaller communities which don’t necessarily need to be near a film production or major studio.

   Last year’s legislative update locked in the program through July 1, 2049.  This allows businesses to have confidence in making long-term capital investments.  This is a major reason why movie studios are constructing large, physical locations expected to employ hundreds across New Jersey.  Studios are making permanent investments.

   Additionally, the base tax credit has increased to 40% of qualified expenses. There are also bonuses for diversity and filming in economically disadvantaged areas.  Finally, it is not only film production which benefits.  Productions which qualify have expanded to digital media, post-production, and even certain reality TV formats.

   Although actors and directors are the first people who come to mind when envisioning Hollywood East, an actual film production includes hundreds of other employees and contractors.  Businesses focused on infrastructure and logistics will construct sets, rent and maintain equipment, and provide transportation services.  The hospitality industry can benefit from long-term lodging and high-volume catering.  Professional services such as accounting, security, specialized IT support (and, of course, legal services) will be in high demand.

   The intersection of state tax law, entertainment industry standards and local regulations can be intimidating to new businesses looking to take part.  There are a number of potential speedbumps a new business looking to participate in Hollywood East must consider, including:

• Properly obtaining a Business Registration Certificate (BRC). The tax credits are for New Jersey businesses.  The business needs to register in New Jersey and obtain a state tax ID number.
• Ensuring your business has adequate insurance. Standard general liability insurance may not suffice for businesses operating on a high-risk film set.  Your business will likely be required to include additional insureds.  Additionally, your business will want to ensure that they properly classify employees and independent contractors and make certain they have proper Workers’ Compensation.
• Creating specialized contracts unique to the film industry. Film production is notoriously fluid.  Shoots can be delayed by weather, actor availability, or script changes.  Standard service contracts can fall short.  Contracts should have clauses tailored for industry-specific delays, cancellation / kill fees to protect if a production pulls out at the last minute, and, if applicable, intellectual property protections.
• See if a municipality is “Film Ready.” Film Ready is a New Jersey program to standardize permitting and fees in municipalities. Each town designated as Film Ready has a local film liaison available to assist businesses.

   Is your business ready to join the production?  The credits are rolling, but the story is just beginning for New Jersey business owners looking to make a mark in Hollywood East.  Contact the Parker McCay business law team today to ensure your company is legally prepared for its close-up.