Loosely, a benny is a person from north of the Raritan river, or mile 129 on the Parkway, especially a New Yorker, who travels to the Jersey Shore in the summer for the purposes of recreation, vacation, or fornication.
To clarify, a benny is not simply a person from Newark. We welcome visitors, whether they be from north Jersey, Canada, or the other side of the world, so long as they are respectful of the local population and the place we call home. The term benny is reserved for those who visit and then find it acceptable to spit in the face of their local hosts. They are disrespectful towards the shore itself as well as those who live here. These rude, self-centered, loud, arrogant, and obnoxious summer tourists are bennys.
As for the origin of the pseudonym, there are over a dozen different definitions ranging from the currency tourists used to the types of shoes they wore, and so it is impossible to say how the name actually began. That said, the most accepted definition is that of the acronym (thus our use of 'bennys' instead of 'bennies', though both are acceptable). Bayonne, Elizabeth, Newark, and New York. When the name first came into use, just following the second World War, these were the primary departure points of tourists to the Jersey Shore.