WOTC Call to Action – New Developments for WOTC and Tax Extenders

Written by Vaughn Hromiko on January 27th, 2012

There are new developments in the effort to include WOTC and other tax-extenders in the upcoming payroll tax cut bill. A Senate-House conference is currently negotiating to extend the payroll tax cut, which expires in February.

Paul Suplizio, President of the WOTC Coalition, reports that Ways and Means Chairman Dave Camp is “waving off in advance an expected offer from Senator Baucus” to include tax extenders in the bill. Max Baucus is Chairman of the Senate Finance Committee.

Mr. Suplizio goes on to explain, however, that while Chairman Camp’s statements should be taken seriously they do not halt the current tax-extenders discussion.

The Senate and President Obama both want the tax extenders in the bill. As a result, WOTC and other tax extenders have become a negotiating chip for Chairman Camp and the House Republicans who want to include other important but controversial provision in the bill.

For WOTC supporters, our job now is at least two-fold. (1) We must persuade Senate conferees to INSIST on including WOTC and the other extenders in the bill. And (2) we must persuade House Speaker Boehner that it will be in the House Republicans’ interest to agree on their inclusion.

Paul Suplizio said it well in a recent correspondence to members of the WOTC Coalition.

“We need to drive home to Speaker Boehner that not including the extenders is putting House Republicans on record as favoring a tax increase on businesses, farmers, communities, and workers—a tax increase they don’t need at this stage of the recovery.”

Is your fax machine and telephone working? Time is short. Time to roll.

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Senators Baucus and Reid — Tax Extenders Should Be Included In Payroll Tax Cut Deal

Written by Vaughn Hromiko on January 24th, 2012

Negotiations are on again to extend the 2011 payroll tax cut until the end of 2012.  The House-Senate Conference met on Tuesday — the first time this year — and the road to an agreement appears rocky.  Optimism is alive – but there are also some big disagreements to sort through.

Both sides of the discussion agree that a deal must be made before the end of February when the current 2-month extension expires.

Of great interest to us is the question of the other tax extenders. The House of Representative’s payroll tax cut proposal does not include the tax extenders or WOTC.  However, Senate Majority Leader Harry Reid and Senate Finance Committee Chairman Max Baucus are reported to have both suggested today that the Conference should examine the expired tax provisions at this time.  (See today’s article in The Hill, scroll down to end.)

Democrats are looking to possibly tuck other provisions into a payroll-tax deal. On Tuesday, Baucus and Reid both suggested that the conference committee examine tax provisions that expired at the end of 2011 — the so-called tax extenders.

On the other hand,

The [House] Ways and Means Committee chairman [Republican Dave Camp] also told reporters after the meeting that conferees should first try to resolve core issues — such as the payroll-tax cut, unemployment benefits and the Medicare “doc fix” — and leave other issues until the end of the negotiations.

 “I think initially we need to have a pretty strict scope of conference,” Camp said. “Let’s figure out what we have been tasked with doing.”

Representative Camp is well aware of WOTC and has been the focus of significant lobbying efforts.  We are keeping our fingers crossed.  Keep your phone and fax machine ready.  The conference members need to hear from you.

More from the New York Times.

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Minnesota Governor’s New Jobs Proposal

Written by Vaughn Hromiko on January 21st, 2012

Minnesota Governor Mark Dayton has announced A Jobs Plan for Minnesota.  The proposal includes various measures designed to encourage hiring and to support workforce development and training.

Of particular interest to The WOTC Planet is the Governor’s New Jobs Tax Credit.

The New Jobs Tax Credit is focused on immediate job creation. It would provide businesses with a $3,000 tax credit for each unemployed Minnesotan, Veteran or recent graduate hired in calendar year 2012 and a $1,500 credit for each new hire through June 2013. This $35 million initiative would create over 10,000 new, private-sector jobs each year.

The Minnesota legislature convenes on Tuesday (January 24).  Presumably, the Governor’s proposals will be presented to the Legislature soon.

Read the Governor’s Press Release and today’s article in The Journal.

 

 

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New Mexico State Graduate Employment Tax Credit

Written by Vaughn Hromiko on January 20th, 2012

Here is a proposal to help qualifying graduates land jobs in the State of New Mexico.  We’ve added this to our watch list.

From the New Mexico DailyLobo.com:

[State] Sen. Tim Keller (D, Bernalillo) is sponsoring the bill, which would provide a $5,000 tax credit to employers who hire New Mexico college graduates in science, technology, engineering, health and math-related fields.

We are still very early in New Mexico’s 50th Legislative session, which began on Tuesday.  On the other hand, the state legislature’s annual session only lasts 30 days, so if this bill is going to pass, we should hear about it soon.

More from the New Mexico DailyLobo.com.

http://www.dailylobo.com/index.php/article/2012/01/noteworthy_bills_and_memorials

From the New Mexico Legislature’s website, Senate Bill 16

 

 

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Finalized! CA Sequoia Valley Enterprise Zone Designation Completed

Written by Vaughn Hromiko on January 18th, 2012

The California Department of Housing and Community Development (HCD) announced Tuesday the final designation of the Sequoia Valley Enterprise Zone (EZ). This designation is effective retroactively to October 6, 2010 and will expire in 15 years. Read about it at The Recorder Online.

In September of last year, I reported on some controversy affecting this and eight other “conditionally” designated zones.  California Governor Jerry Brown’s office had instructed HCD to delay the final designation of these zones.  That order has since been retracted and the remaining designations are being processed.

According to the zone’s website, the Sequoia Valley EZ affects the California communities of Cutler/Orosi Dinuba, Ducor, Earlimart, Exeter, Farmersville, Goshen, Ivanhoe, Lindsay, North Delano, Pixley, Poplar, Porterville, Richgrove, Strathmore, Terra Bella, Tipton, Traver, Tulare, Visalia, Woodlake.  However, if your business is located within any other part of Tulare County, don’t rule out eligibility until you have confirmed it with a phone call.

Businesses located within the EZ are eligible for a number of valuable tax incentives including:

EZ Hiring Credit
Firms can earn $37,440 or more in state tax credits for each qualified employee hired

EZ Sales & Use Tax Credit
Sales tax credits on purchases of qualified machinery and parts

Net Operating Loss Carry-forward
Up to 100% Net Operating Loss (NOL) carry-forward (which can be carried forward for 15 years)

EZ Business Expense Deduction
Up-front expensing of certain depreciable property

Net Interest Deduction
Lenders earn tax-free interest on qualifying loans to EZ businesses.

Bid Preferences
EZ vendors can earn preference points on state contracts.

Please feel welcome to contact me with your questions about the State of California’s EZ program, or about this or any other particular CA zone.  I am Vaughn Hromiko, vah@WOTCPlanet.com

 

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WOTC – Calm Before the Storm in Congress

Written by Vaughn Hromiko on January 10th, 2012

Is it the calm before a storm? Congress is on vacation. The Senate is scheduled to reconvene on January 23rd. The House on January 17th.

Before members of Congress left for the holiday in December, they had tumultuously agreed on a 2-month extension of the 2011 payroll tax cut and left many expiring tax items floating into limbo. The Work Opportunity Tax Credit, of course, is counted among these unfinished items.

Although nothing has made significant news yet, the conference that was promised last month by House and Senate leaders is already busy behind the scenes. According to Paul Suplizio, lobbyist and President of the WOTC Coalition, conferees for the Senate and House respectively are in discussion with their own members but not yet with each other. The first meeting between Senate and House conferees will likely take place next week.

The goal of the conference is to hammer out a compromise that will allow Congress to pass a full-year extension of the payroll tax cut, in addition to other high-priority items. They need to do it before the end of February when the 2-month extension expires.

Our goal is to include WOTC and other tax items in that legislation. The conferees, however, face historically difficult and stressful circumstances. WOTC remains in a very precarious situation. If the tax extenders do not make it into the anticipated payroll tax cut bill, it will be difficult to see another vote on these items until after the November election.

During the past 15 years, WOTC has expired and been renewed at least 7 times. Three of these renewals took place well into the next calendar years — as much as 11 months after expiration.

If the program is not renewed in February, business will continue as usual. Employers will continue to screen for all of the WOTC target groups. The State Workforce Agencies, however, will receive instructions to place a hold on WOTC employee certifications — except for those who qualify under the military veteran categories, which have been extended already through December 2012.

Then, as soon as the renewal legislation is passed, the State Workforce Agencies will complete and issue the rest of the outstanding WOTC employee certifications.  We’ve lived through it before. But let’s hope it doesn’t come to that.

My office will be following the lead of the WOTC Coalition by contacting key legislators during the upcoming weeks. I’ll post new information and guidance as it becomes available.

Please feel welcome to contact me personally if you would like to discuss (or simply commiserate). vah@WOTCPlanet.com

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For a Limited Time Only: New York Youth Works Tax Credit Now Available

Written by Vaughn Hromiko on January 4th, 2012

The New York Youth Works Tax Credit program was signed into law by Governor Andrew M. Cuomo last month on December 9th.  The program’s hiring credit is effective for qualifying at-risk youth hired between January 1 and July 1, 2012.

The Business Council of New York State has published a detailed facts sheet  describing the program’s eligible employers and employees and the amounts and terms attached to the tax credits.  The fact sheet is available on the Council’s website.

Governor Cuomo issued a press release at the time the legislation was signed.  The following excerpts are drawn therefrom.

Governor Andrew M. Cuomo today signed a bill creating “NY Youth Works,” an inner city youth employment program that will combat high unemployment in the state’s metro areas. The new law includes $25 million in tax credits for businesses that hire unemployed and disadvantaged youth and $62 million to support job training programs.

The NY Youth Works program provides $25 million in tax credits to benefit employers that hire unemployed youth over the first six months of 2012, with the ultimate goal of permanent, unsubsidized employment. . . . Eligible participants for the jobs program include unemployed, low-income youth aged 16 through 24 who are located in one of the following areas: Albany, Brookhaven, Buffalo, Hempstead, Mount Vernon, New Rochelle, New York City, Rochester, Schenectady, Syracuse, Utica, and Yonkers.

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2012 Predictions for CA’s Enterprise Zone Program

Written by Vaughn Hromiko on January 2nd, 2012

It’s January 2, 2012 and so far, not a peep from the Governor’s office about destroying California’s best tax incentive program. So far, so good. Last year at this time, California was holding its breath in anticipation of Governor Jerry Brown’s 2011 budget proposal. Rumors had been leaked that the Governor’s budget would propose the elimination of the state’s Enterprise Zone program.

As it turned out, those rumors were true. A heated political debate ensued that lasted into the summer of 2011. In the end, the Enterprise Zone program was preserved without modifications. The program’s opponents could not muster the votes needed to pass their nefarious legislation.

Since that time, supporters of California’s enterprise zones, like Democratic Assemblyman V. Manuel Pérez, have been pursuing more constructive legislative changes. He was recently asked by The Desert Sun about his political predictions for 2012. Among other things,

Pérez . . . predicts reforms to the state enterprise zone process, “resulting in a more accountable, transparent economic development program serving our neediest communities.”

I hope Assemblyman Pérez is right in his prediction. Reasonable changes that make the program more transparent and effective might also contribute to its continued political stability.

The Governor’s office has directed the Department of Housing and Community Development (HCD) to evaluate potential regulatory changes to the way the enterprise zone program is run. A regulatory approach will not permit the draconian revamping proposed by the Governor in 2011 . . . and might actually produce something beneficial. In any case, HCD’s evaluation appears to still be in a very early phase.

Based on my personal experience with the last set of regulations prepared by HCD for the Enterprise Zone program, it will probably be a year or more before anything concrete is ready. Prove me wrong, HCD. I’m cheering for Assemblyman Pérez to get something decent through the California legislature first.

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WOTC Extension Must Wait Until 2012

Written by Vaughn Hromiko on December 23rd, 2011

It’s been all over the news. The U. S. House and Senate agreed to pass a 2-month extension of the 2011 payroll tax reduction. Unfortunately, the tax extenders including WOTC, Research and Development and other important tax incentive programs were not included in this hotly contested legislation.

It is clear, however, that the White House and Senate leadership continue to support tax extenders, which are one of the Senate’s top priorities.

With the agreement to pass the 2-month extension of the payroll tax reduction, Senate and House leaders have also agreed to appoint conferees to hammer out a full 12-month extension. It is in this process that we have our next opportunity to see tax extenders, including WOTC, gain traction for 2012 renewals.

Paul Suplizio, President of the WOTC Coalition, has set the Coalition on course to begin a new campaign on January 2, 2012. The objective, of course, is to persuade House and Senate conference members to include the full-WOTC extension and other tax extenders in the final payroll bill.

Stay tuned . . . it won’t be long.

 

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Renewal of WOTC and Payroll Tax Cut Still Possible This Year

Written by Vaughn Hromiko on December 19th, 2011

If you’ve been following the news during the past few days, you might be aware that Congressional leaders are sparring over legislation to extend the existing payroll tax cut. Over the weekend, the Senate rejected the House’s proposal and responded with a proposed 2-month extension, obviously intended to buy time for further negotiations.

Neither version of the legislation included WOTC nor other sought after tax-extenders. This is not, however, the end of the game.

The limited 2-month extension is not looked upon favorably by the House Republican leadership, which is demanding a full year.  The House is scheduled to vote on the bill this evening.

According to Bloomberg,

With the House set to return to Washington [Monday], Republican leaders are studying their options, Laena Fallon, a spokeswoman for House Majority Leader Eric Cantor, a Virginia Republican, said in an e-mail.

When the House meets [Monday evening], it will either vote to amend the Senate-passed measure “so that it is responsible and in line with the needs of hard-working taxpayers and middle class families” or vote to appoint representatives to a House-Senate conference to reconcile differences between the two chambers, she said.

Got that? The House will either amend the Senate bill and return it. Or it will vote to appoint a conference with the Senate to negotiate revisions. If the House does call for a conference, the Senate leadership (aka Senator Harry Reid) could accept or reject it. But rejecting it in that case would result in a tax increase on January 1 as the payroll tax reduction expires. Not a pretty political sight.

If a conference is called, Paul Suplizio, President of the WOTC Coalition sees still another opportunity to get WOTC and other tax extenders passed this year.

“If it gets to a conference, Ways and Means Chairman Dave Camp of Michigan would be one of the conferees for the House (he was floor manager for the House bill) and Finance Chairman Max Baucus of Montana a likely conferee for the Senate.”

“Chairman Camp has been the target of much of our lobbying and knows the situation of WOTC and the extenders. Senator Baucus has been a champion for including WOTC and the other extenders in the payroll bill.”

If you have any opportunity to encourage Representative Dave Camp or Senator Max Baucus, now is the time. Senator Harry Reid and his friends in the Whitehouse should also be contacted.  Senator Reid will likely require encouragement from the Whitehouse to include WOTC and other tax extenders in any negotiated resolution to this legislative conflict.

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