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light of the fact that small high-technology firms one of the primary sources for net new job generation in United States (Birch, The Job Generation Process. 1979; Location of High Technology Firms and Regional Economic Development. Staff of Joint Economic Committee, June 1, 1982.), it is important to ensure that their growth is not stymied by the absence of an appropriate labor force. "Yet," Pat Hill, Manager of Technology Training and Careers for the American Electronics Association. testified. "they are affected by the technical manpower shortages to a greater extent than their larger industry counterparts simply because, unlike them. small companies cannot conduct extensive in-house training programs to 'grow' their own technical talents." (Before the Senate Small Business Committee, Feb. 18, 1981.)
Community colleges and technical institutes can play a vital role in preparing students for careers in high-technology industries. They are already important sources for supplementing and/or replacing on-the-job training for technicians and for educating and training technicians who later become engineers by directly going on to an engineering school or as a result of onthe-job training (Dept. of Ed./NSF Staff Analysis, October, 1980, P. 42). Post-secondary vocational education can play a role in aiding business and industries to maintain ΟΙ regain their technological leadership and improve productivity.
Yet these schools face a number of problems in providing education and training for students interested in high-technology As the National Science Foundation's second Five-Year Outlook on Science and Technology (NSF 81-40) notes, for example, community colleges are not yet integrated into the rest of the science and engineering education system. The NSF highlights problems in upgrading faculty, curricula, and equipment.
Business-community college/technical institute relationships are an important means for addressing these problems (National Center for Research in Vocational Education. Preparing for High Technology, 3 vols., 1982). With business assistance. community colleges have developed projects in areas such as computer graphics. mini-computers, medical electronics. robotics. records management and word processing, precision optics. and laser optics (Preparing for High Technology. Programs That Work.)
Yet funding for such important programs is difficult to obtain. S. 108 would provide crucial Federal tax incentives thereby enabling community colleges and technical institutions to leverage private sector investments. S. 108 is needed because current tax provisions in effect skew business investment decision-making by offering greater incentives for establishing programs with universities and four-year colleges than with other degree-granting post-secondary institutions.
We do. however, feel that S. 108 does not go far enough. If enacted, this legislation is likely to have a far greater impact on corporate equipment donation strategies than on corporate
provision of instructors or hiring of part-time employees. The tax incentives for the latter activities are most likely too minor to do more than reward taxpayers already included to engaged in what is, admittedly, a worthwhile pursuit.
Rather than providing greater incentives for instructors and hiring, we would urge the Committee to focus directly on the financial needs of community colleges and technical institutes offering important education and training programs. Tax incentives also are needed to encourage employers to provide tuition payments for community college and technical institute degree-granting programs.
Such incentives are particularly important for small hightech companies. Even though these firms are the primary source of net new high-tech job generation, they lack the disposible income which larger firms use for in-house training programs and grants to educational institutions.
We urge that S. 108 be amended to include a tax credit for small firms which participate in cooperative education programs for paraprofessionals and technicians with accredited degreegranting post-secondary institutions. In order to qualify for the credit, the firm would be required to release the employee for at least 10% of his (her) time to participate in a education and training program. Such programs would be designed by the cooperating schools, unions. and firms. The only other requirements would be that the program must involve both inhouse apprenticeship and classroom education components, and that successful completion of the program would result in at least an Associates Degree for the student. For every employee enrolled in the program. the firm would qualify for a tax credit equal to all sums that it contributed to the school for the operation of the program plus the employee's release time wages or salary for the period that the employee is enrolled in the program if the employee was hired within the last 12 months. A cap of 5% of the employee's annual wage or salary would be placed upon the credit.
We urge the Committee to endorse S. 108 and to enhance its operation by adopting our suggested amendment. If needed, tax incentives for corporate provision of instructors and hiring instructors as part-time employees could be deleted from the bill. I want to emphasize, however, that even if no changes are made, we support this legislation. As we stated when we endorsed this legislation in a recent issue of our newsletter, NIETNET, "The shortage of highly-trained, highly-educated people for hightech industries demands a new emphasis on quality Associates Degree programs as well as attention to B.A., B.S., M.A., and
Travelers Aid Association of America
Gilbert Colgate, Jr.
J. Howard Holan
Mary W. Payson
Dr. Ben T. Yamaguchi, Jr.
David L. Gamble
Faith A. Griefen
Mary W. Milam
Executive Director, Joel E Rus
Dr. Neil Pitts
Elnor F. Tillson
Alfred D. Bell, Jr.
A United Way Agency
August 12, 1983
Hon. William Armstrong
Taxation and Debt Management
215 Dirksen Senate Office Building
Washington, DC 20510
Testimony for Hearings on Volunteer Mileage Deduction Legislation,
Dear Seantor Armstrong:
Every year over 2.6 million people find that Travelers Aid gives an immediate helpful response to their problems. In transportation terminals and in center city offices, Travelers Aid provides assistance that is not available through government programs or commercial enterprises. From runaway youths to elderly vacationers, from unemployed jobseekers to business travelers, Travelers Aid provides unique counseling and emergency assistance resources for individuals and families who experience a problem or a crisis while separated from home and familar forms of support.
The cornerstone of Travelers Aid is the 4,000 direct service volunteers
In pursuit of their voluntary activities they also logged countless
701 Lee Street Suite 600 Des Plaines, Illinois 80016 (312) 298-9390
Hon. William Armstrong
2.6 million people assisted by 4,000 volunteers donating 750,000 hours of labor. This is a form of American enterprise that should be encouraged through changes in public policy. Because volunteers are essential to our efforts to help mobile and displaced Americans, Travelers Aid Association of America strongly supports S1167 sponsored by Senator Durenberger of Minnesota and S1579 sponsored by Senator Armstrong of Colorado. These bills would revise the Internal Revenue Code to give the same mileage deductions to persons donating their time to volunteer enterprises as is given for commercial activity or government service.
It is our view that the proposed revisions to the Internal Revenue Code will further encourage the contributions being made by volunteers to Travelers Aid and the related charitable organizations with whom we work on behalf of the American people.
We urge the Senate Finance Committee and the United States Senate to support S1167 and S1579 which will strengthen the voluntary sector and a key pillar of the American way of life.
Jord & Rus
Joel E. Rus
National Executive Director
August 2, 1983
The Honorable Bob Packwood
Chairman, Subcommittee on Taxation
and Debt Management
Senate Committee on Finance
SD-219 Dirksen Senate Office Building
Dear Senator Packwood:
Director, Washington Office
YMCA of the USA
Washington, DC 20000
We urge the support of the Subcommittee on Taxation and Debt Management for legislation to raise the deduction for charitable use of an automobile to the level of reimbursement for business or government use. The National Board of YMCAs has unanimously voted its approval of such legislation.
Both the public and private for-profit sectors are placing
We would appreciate your incorporating this letter into the record of the Subcommittee's hearing of yesterday on this and other tax measures.