In our spotlight on Business Report, Could New Jersey become the Hollywood of the East?

Well, that's what state leaders are hoping as they inch closer to opening a massive film studio for Netflix.

This week, two Shore towns gave Netflix approval for a $900 million film and TV studio at Fort Monmouth.

And the state has hosted hundreds of film and TV productions over the last few years, while also expanding tax credits for studios working in New Jersey.

The Netflix studio could propel the state to new heights and draw even more revenue for our film industry.

Tim Sullivan, the CEO of the New Jersey Economic Development Authority, joins me now to discuss this latest deal and the future of film in New Jersey.

Tim, great to have you with us tonight.

I saw that you posted on X that this Netflix studio deal is a huge milestone and a testament to the efforts of the governor, the legislature, local and county governments.

What do you believe this will mean for New Jersey?

It's going to be such an extraordinary project.

Netflix choosing New Jersey, choosing Monmouth County, using the former Fort Monmouth Army base as a place to build $1,000,000,000 plus East Coast flagship facility is a game changer.

It's it's it represents the you know, the culmination of the redevelopment of Fort Monmouth, which was such a tragedy when that closed and as well as a huge, huge milestone on New Jersey's march toward the top of the film and TV industry.

You know, under Governor Murphy's leadership, film and TV is booming in Jersey.

We've made major investments and there's probably no better example than Netflix's choice to make a big bet on New Jersey.

Economically, what does this mean for the state?

Most importantly, jobs.

Lots and lots of jobs.

We're talking about thousands of construction jobs to build the facility.

And then on a production side, you're talking about 1400 plus.

And I think that's a low estimate, candidly.

Permanent jobs.

You know, when when you've got a facility like Netflix is going to build, they're going to keep that thing full and rocking and rolling, not quite 24 seven, but, you know, year round.

And for me, that means lots and lots of permanent jobs.

Netflix is projecting they're going to shoot at least $600 million worth of film and TV at their studio in Monmouth County.

That is a huge amount of business.

Yeah, there's a requirement that they have to stay in that location for ten years, right?

That's right.

Some of the criticism against investing in some of the tax credits that have been issued in New Jersey, investing in the film industry is that the jobs are temporary.

Does having a studio change that or do we still see that these are transient jobs?

They're here for a period of time and then they go.

Yeah, I'm not sure I accept the premise of the of the of the criticism, to be honest with you, because, you know, if you are if you have a booming film and TV industry, whether those are on location shoots or studios, those are careers, as you know, for people.

They're assembled in two or three month assignments, just like in the construction industry.

You're working on different projects and you work on a few projects every year, and that's a that's a full year salary.

But certainly we're really excited about the studio investment.

So the the the brick and mortar, whether it's Netflix, whether it's Lionsgate in the south of Newark, whether it's at any of the studios in town, you know, you're seeing major, major capital investment in what are going to be permanent jobs in for New Jersey residents.

And it's incredibly exciting.

I've got to ask you this.

This deal happened in no small part due to massive tax breaks for Netflix to the tune of $387 million.

I know Democratic voters have railed against big tax breaks for, you know, multiple million dollar companies.

Was this the right type of tax break for New Jersey?

How do you respond to those concerns?

Yeah, One of the most important things about the tax credit program that Governor Murphy signed into law in 2021, which we're using here, was called the Aspire Program for for commercial projects like this certainly is.

There's what's known as a net benefit test, meaning for every dollar the state puts and what do we get back directly in tax revenue, whether it's at that state level or the local level.

And in this case, it's that the bar is set, at least for every dollar we put in, we get a dollar 25 back in in tax revenue.

So the states, you know, if if everything goes according to plan, the state will actually end up making more, you know, making money on this transaction.

And the other thing that's important about it is it's pay for performance.

It's not like we're rolling up a Brinks truck in front of Netflix's offices some day with $387 million in it.

It's a ten year pay for performance program where if they don't hit their milestones and do what they said they were going to do, they don't get the tax credits.

I would imagine, too, there's a residual effect for the towns that are hosting some of the films that come in to New Jersey.

Enormous.

I mean, again, think of the Netflix context.

You know, municipalities like Oceanport and Eatontown and both their mayors have been great partners here, as is the entire leadership in both towns and Monmouth County.

They're incredibly excited what this means for their downtowns, what it means for their small business communities, what it means for property values.

It's all incredibly exciting.

Yeah, and I know we've got Happy Gilmore filming right now.

We've got Song Sung Blue with Hugh Jackman, Kate Hudson, a couple other films in the works.

Lot going on here in New Jersey.

Tim Sullivan, CEO of the Economic Development Authority.

Thank you.

Thanks to.