LRB-3327/1
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2001 - 2002 LEGISLATURE
September 26, 2001 - Introduced by Joint Legislative Council. Referred to
Committee on Labor and Agriculture.
SB249,2,2
1An Act to renumber 120.13 (17) (title);
to renumber and amend 120.13 (17)
2and 343.10 (6);
to amend 20.445 (3) (md), 39.393 (2), 39.393 (3), 49.1475, 71.05
3(6) (a) 15., 71.08 (1) (intro.), 71.21 (4), 71.26 (2) (a), 71.28 (1dx) (b) 1., 71.34 (1)
4(g), 71.45 (2) (a) 10., 77.92 (4), 106.01 (11), 119.04 (1), 119.70 (5), 343.10 (1) (a)
5and 560.797 (4) (f); and
to create 15.227 (14), 20.292 (1) (kd), 20.445 (1) (d),
636.11 (1) (cg), 38.14 (2) (e), 38.34, 49.175 (1) (zp), 71.07 (5d), 71.07 (5r), 71.07
7(5v), 71.10 (4) (cd), 71.10 (4) (cp), 71.10 (4) (k), 71.28 (1dx) (b) 1m., 71.28 (1dx)
8(f), 71.28 (5d), 71.28 (5r), 71.28 (5v), 71.30 (3) (dg), 71.30 (3) (dm), 71.30 (3) (g),
971.47 (5d), 71.47 (5r), 71.47 (5v), 71.49 (1) (dg), 71.49 (1) (dm), 71.49 (1) (g),
10106.01 (12), 106.01 (13), 106.175, 106.18, 106.28, 118.115 (2), 343.10 (6) (b) and
11560.157 of the statutes;
relating to: special labor-related reports; training,
12education, and development zone tax credits; training and education programs;
1providing an exemption from emergency rule procedures; granting
2rule-making authority; and making appropriations.
Analysis by the Legislative Reference Bureau
This bill is explained in the Notes provided by the joint legislative council in
the bill.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
Prefatory note: This bill was prepared for the joint legislative council's special
committee on labor shortage. The bill makes numerous changes to current law in a
variety of subject matters. Among other things, the bill does the following:
SPECIAL LABOR-RELATED REPORTS
Labor Day Report
The bill requires the department of workforce development (DWD) to prepare an
annual report on the labor supply in Wisconsin. The report must describe any critical
labor shortage areas identified by DWD by occupation, region, gender, and race. The
report must also recommend potential solutions for those critical labor shortages. Copies
of the report must be submitted to the appropriate standing committees of the legislature,
to the local workforce development boards established under the federal Workforce
Investment Act of 1998 throughout the state, and to other appropriate organizations as
determined by DWD.
Department of Corrections Study
The bill requires the department of corrections to report on the availability and
effectiveness of programs that provide drug and alcohol abuse treatment, instruction in
basic skills such as reading and math, and job skills training to prisoners. The report
must include an analysis of the enrollment in and access to these programs by race
compared with the racial composition of the prison population as a whole. The report
must also include suggestions for programs that would help prisoners enter the
workforce.
Tax Study
The bill requires the department of revenue (DOR), in cooperation with DWD, to
study and report on current workforce development-related tax incentives and to make
recommendations on the state's tax laws to help ensure that the state is able to attract,
develop, and retain a highly skilled, highly trained workforce. In developing the report,
groups representing employers, employees, taxpayers, and other appropriate groups
must be consulted. The report must also consider similar tax incentives in other states.
Student Loan Forgiveness Study
The bill requires the higher educational aids board (HEAB), by January 1, 2002,
to study and report on the cost, desirability, and effectiveness of creating a student loan
forgiveness program to attract workers to the state.
Jobs Skills Training Program Report
The bill requires DWD to collect information concerning the availability of basic
job skills training programs in the state and periodically prepare reports identifying
those programs for distribution to local workforce development boards, job centers, and
other appropriate organizations. To the extent practicable, the reports must identify
available training programs by region.
TAX INCENTIVES
Productivity Enhancement Training Tax Credit
The bill provides a nonrefundable business tax credit for expenses incurred by a
business to provide certain training to the business's employees. The credit equals 100%
of the business's certified training expenses, up to a maximum of $7,500 per year. Eligible
training expenses include up to $2,000 incurred for pre-training assessment and
consultation services. The credit may not be claimed for amounts deducted by the
business under the Internal Revenue Code as ordinary and necessary business expenses.
Unused credits may be carried forward for up to 15 years. Under the bill, sole
proprietorships, corporations, and insurers may claim the credit. Partnerships, limited
liability companies, and tax option corporations compute the credit but pass it on to the
partners, members, and shareholders in proportion to their ownership interests.
The purpose of the credit is to encourage businesses to provide training to their
employees to improve productivity and to promote, and provide workers for, high-skill
and high-wage jobs.
To qualify for the credit, the department of commerce must certify the business's
productivity enhancement training expenses. To be eligible to have its expenses certified,
the business must submit to the department of commerce a productivity enhancement
training plan designed to: (1) increase employee productivity; and (2) result in employees
holding jobs in the business that require higher degrees of skill to perform and that pay
higher wages than their current jobs. In addition, the business must receive pre-training
needs assessment and consultation from an experienced provider of productivity
assessments, as approved by the department of commerce. Finally, the business must
submit an accounting of its productivity enhancement training expenses so that the
department of commerce may determine if the expenses were incurred under the training
plan.
Each business that has its expenses certified and that claims the tax credit must
report to the department of commerce, by March 1 of the year the business receives the
certification, on the results of its productivity enhancement training and on its success
in meeting the goals established in its productivity enhancement training plan. The
department of commerce is required to report to the legislature by December 1 annually
on the effectiveness of the program.
The tax credit is available for taxable years beginning after December 1, 2000. No
business may be certified for tax credits for any taxable year beginning after December
31, 2009.
Apprenticeship Tax Credit
The bill creates an income tax and franchise tax credit for an employer that pays
wages to an apprentice who is participating in a two-year to five-year apprenticeship
program in which the apprentice is receiving instruction leading to qualification as a
skilled journeyman in any industrial manufacturing trade, any private sector service
occupation, or certain construction trades. The amount of the credit is five percent of the
wages that are paid to an apprentice in a taxable year, but cannot exceed $1,400, except
that, in the taxable year in which the apprentice completes the apprenticeship program,
the amount of the credit is eight percent of the wages that are paid to an apprentice, but
cannot exceed $3,000. An employer will not receive the credit unless the employer enters
into an agreement with DWD permitting DWD to post on DWD's Internet site the
employer's name and address and the number of apprentices and journeymen that the
employer employs during the year. Generally, no employer may claim the credit for
taxable years beginning after December 31, 2004, if the number of employers training
apprentices does not increase by more than 40% from January 1, 2002, to December 31,
2004.
Education Tax Credit
The bill creates an income tax and franchise tax credit for businesses that pay
tuition for an individual to attend a university, college, or technical college. Sole
proprietorships, corporations, and insurers may claim the credit. Partnerships, limited
liability companies, and tax-option corporations compute the credit but pass it on to the
partners, members, and shareholders in proportion to their ownership interests. The
credit is an amount equal to: (1) 50% of the tuition paid by a business for an individual
to attend school in a taxable year, if the individual is enrolled in a degree-granting
program; and (2) 75% of the tuition paid by a business for an individual to attend school
in a taxable year, if the individual is enrolled in a degree-granting program and if the
individual's taxable income is not more than 185% of the federal poverty line. If the credit
claimed by a business exceeds the business's tax liability, the state will not issue a refund
check, but the business may carry forward any remaining credit to subsequent taxable
years.
Development Zone Tax Credits
Under current law, a person may claim an income tax credit for up to 50% of the
person's environmental remediation expenses incurred in a development zone. Under
current law, the credit may not be transferred between persons, and a municipality or
nonprofit organization that engages in remedial remediation activities in a development
zone may not claim a credit.
This bill provides that any person eligible to claim a credit for remediation
expenses incurred in a development zone may transfer the right to claim the credit to any
other person subject to taxation in this state. In addition, the bill provides that a person
may claim a credit for 50% of the amount expended by a municipality or a tax-exempt
or nonprofit organization for environmental remediation in a development zone, if the
municipality or organization has entered into an exclusive written agreement with the
person claiming the credit. The bill requires DOR to promulgate rules implementing the
credit transfer provisions.
TRAINING AND EDUCATION
Job Training Access Policies
The bill requires every public educational institution in the state to have a policy
regarding access to their facilities by local organizations and businesses for the purpose
of employment-related training. If the policy allows for such access, the policy shall set
a reasonable cost. The policy may allow access based on the availability of space and the
appropriateness of the training and only insofar as access would be consistent with the
institution's mission.
Trade Master's Pilot Program
Under current law, $50,000 is provided in fiscal year 2001-02 for DWD to provide
a trade master's pilot program to recognize advanced training and postapprenticeship
achievements in three trades, crafts, or businesses, one of which must be in the industrial
sector, one in the construction sector, and one in the service sector of the economy.
This bill requires DWD, in selecting the trades, crafts, or businesses to be included
in the pilot program, to seek to maximize participation in the pilot program of minority
group members. The bill also requires DWD to submit to the legislature by July 1, 2004,
an evaluation of the effectiveness of the program. In addition, the bill appropriates
$110,000 in fiscal year 2001-02 and $120,000 in fiscal year 2002-03 to increase the
full-time equivalent positions authorized for DWD by one position for the
implementation and development of the program.
Workplace Diversity Grant Program
The bill creates a workplace diversity grant program administered by DWD.
Under the program, local, nonprofit organizations that offer diversity training, basic
employment skills development, or instruction in English as a second language to
employees and to persons seeking employment may qualify for grants.
A local, nonprofit organization is qualified for a grant if any of the following apply:
(1) The governing body of the local, nonprofit organization is comprised of
representatives of private sector employers and local government units or agencies, and
the local, nonprofit organization assists local employers in meeting their workforce needs.
(2) The local, nonprofit organization assists persons who have been convicted of
a crime, whether employed or not, in strengthening or developing their employment skills
and in making or easing their transition from incarceration to work.
(3) The local nonprofit organization assists any of the following persons, whether
employed or not, in preparing for or gaining entry into the skilled trades: (a) persons
eligible for the Wisconsin works program (commonly referred to as "W-2"); (b) military
veterans; (c) persons who have been convicted of a crime; (d) persons eligible for food
stamps; and (e) minority group members.
DWD must attempt to award grants to eligible organizations from different
geographic regions of the state. The bill appropriates $120,000 for the grants in fiscal
year 2001-02 and limits the amount of a grant to any given organization to $30,000.
