The primary objective of the 2-4% Diversity Tax Credit is to stimulate job growth by encouraging film productions to employ the services of women and minority persons. The structure of this program seeks to further ensure that equal employment opportunities are offered to “above-the-line” positions (generally, key creative positions) as well as “below-the-line” positions (all other production crew).

Film productions looking to receive a diversity bonus can be awarded either 2% or 4% of the qualified film production expenses. See c) below to learn the difference in requirements for each increase.

Requirements:
(a) An applicant that seeks to increase its award through the use of a diversity plan shall submit a completed plan (see Form A – Diversity Plan) to NJEDA before the NJEDA may approve an application pursuant to the applicable program rules. An applicant may consult with the NJEDA regarding the requirements of the diversity plan in advance of submitting the plan.

(b) The diversity plan shall identify that the applicant intends to prioritize actively recruiting and hiring African Americans, Hispanic, Asian Americans, Native Americans, and women in all areas of production of the film, specifically production crew and staff, entry level positions, management positions and talent related positions.

(c) An overall goal of not less than 25 percent shall be utilized in the hiring of minority persons and women. All diversity plans must identify goals for hiring both minority persons and women.

– To receive a bonus of 2%: no less than 25% of the total employees hired must be women or members of a minority group

– To receive a bonus of 4%: above requirement must be met AND no less than 25% of the onscreen talent must be 1. women or members of a minority group; 2. Residents of NJ for at least 12 months before the beginning of filming; and 3. Are members of a bona fide labor union representing film and television performers

(d) The diversity plan will indicate whether and, if so, how the applicant intends to participate in training, education and recruitment programs that are organized in cooperation with New Jersey state colleges and universities, labor organizations, and the motion picture industry and are designed to promote and encourage the training and hiring of New Jersey residents who represent the diversity of the state’s population. Such cooperation is encouraged but not required.

(e) The diversity plan shall indicate which efforts the applicant will make to ensure equal employment opportunities for minority persons and women in the recruitment, selection, appointment, promotion, training, and related employment areas. These actions may include advertising, recruitment, and internship opportunities

Program Reporting:
If as part of the final documentation required for final approval of the tax credit, the applicant submits evidence satisfactory to the NJEDA and the Director of the Division of Taxation of good faith-efforts to accomplish all the actions described in the diversity plan, the final tax credit amount will include the bonus. If the final approval of the applicant’s tax credit application does not include the bonus, the applicant may appeal the final approval as described in the program rules at N.J.A.C. 19:31-21.7(f).

Certification:
In order to support the fact that an individual who worked on the production is a woman or minority person, consistent with the applicable rules, the applicant must provide payroll information detailing which individuals working on the production self-identified as either minority and/or woman, or provide the Authority with a copy of the Diversity Tracking Sheet, (see Form B – Diversity Tracking Sheet) from the individual, if the information is not available from the payroll company.

Good Faith:
The applicant shall undertake appropriate outreach and talent acquisition activities that are reasonably designed to effectively identify, recruit and incorporate women and minority persons into the applicable film production. Good faith efforts are assessed using various factors, including, but not limited to the following, which shall be provided by the applicant:

– A report prepared by the payroll company or the diversity employment tracker (if payroll information is not available) listing the applicant’s overall number of production workers, by category, upon completion of filming.

– The names, addresses, and other information provided on the payroll information or on the Diversity Tracking Sheets of minority and women production workers, by category, upon completion of filming.

– The final diversity numbers of the production.

– Documentation of efforts made to recruit and hire women and minority persons to meet the goals of the diversity plan. This can include, casting solicitations, e-mail confirmation or other correspondence to those people contacted but not hired. A list of names, dates and times of people and/or businesses that were contacted may be considered as well.

– The NJEDA may contact the individuals and businesses listed by the applicant to verify the good faith efforts.

Audit Process:
NJEDA or the Division of Taxation may audit the applicant’s submissions, in which case the NJEDA or the Division of Taxation may ask for documents supporting the application and submitted documentation regarding the diversity plan, including, but not limited to, any of the following documents:

– the books, records and supporting documents of the eligible production corporation

– agreements and contracts between actors, producers, directors, and other persons and the eligible production corporation

– any other documents that may be needed to support your claim

– Form A – Diversity Plan

– Form B – Diversity Tracking Sheet – To be used in conjunction with Diversity Goal Tracker if payroll information cannot be provided.