SB394: Bill Text

LRB-3778/2

PG/RT/MS/GM/PK/IS/JK/ML:cmh:hmh

1999 - 2000 LEGISLATURE

1999 Senate BILL 394

February 16, 2000 - Introduced by Joint Legislative Council. Referred to Economic Development, Housing and Government Operations.

SB394,2,5 An Act to renumber and amend 49.157 and 66.462 (2); to amend 20.445 (3) (md), 38.15 (3) (c) 3. and 4., 49.1475, 66.462 (1) (c), 71.05 (6) (a) 15., 71.08 (1) (intro.), 71.21 (4), 71.26 (2) (a), 71.28 (1dx) (b) 1., 71.34 (1) (g), 71.45 (2) (a) 10., 77.92 (4), 281.60 (2r) (a), 292.15 (2) (at) (intro.) and 6., 292.24 (title), (2) (intro.), (a), (b), (c), (f), (g) and (3) (a) to (c), 292.26 (2) (intro.), 560.14 (4m) (a) (intro.), 560.33 (1) (c) and 560.34 (2) (title); and to create 20.255 (2) (dr), 20.255 (3) (er), 20.292 (1) (kd), 38.34, 49.157 (2), 49.157 (3), 49.175 (1) (zp), 71.07 (5r), 71.10 (4) (k), 71.28 (1dx) (b) 1m., 71.28 (1dx) (f), 71.28 (5r), 71.30 (3) (g), 71.47 (5r), 71.49 (1) (g), 106.01 (11), 115.28 (45), 115.455, 292.11 (14), 292.15 (2) (at) 5., 292.15 (8), 292.31 (11), 560.14 (4m) (c), 560.27, 560.31 (2) (g) and 560.34 (1c) of the statutes; relating to: job retention programs; productivity enhancement training tax credit; applied technology centers; the certified capital company program; promoting the development of multistate venture capital development conferences; amending the brownfield and the environmental remediation tax incremental financing district laws; creating a foreign language immersion grant program and Wisconsin world geography fund; low-income transportation assistance; establishing an advanced journeyworker pilot program; granting rule-making authority; and making an appropriation.

Analysis by the Legislative Reference Bureau

This bill is explained in the Notes provided by the joint legislative council in the 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 state strategies for economic development.

The bill makes numerous changes to state laws in a variety of subject matters. Among other things, the bill does the following:

•Creates a statewide job retention skills development program within the technical college system.

•Provides a business tax credit for expenses incurred by a business to provide certain training to the business's employes.

•Modifies the technical college district board applied technology center program to allow full use of donated funds and to extend the sunset date of the program.

•Modifies the certified capital companies (CAPCO) program.

•Expands the scope of the state's venture capital fair grant program.

•Establishes a foreign language immersion grant program within the department of public instruction (DPI).

•Appropriates $500,000 for the establishment of the Wisconsin world geography fund.

•Provides additional emphasis on transportation under the Wisconsin Works (W-2) program by expanding eligibility for W-2 transportation, requiring the establishment of local W-2 transportation advisory committees and requiring W-2 agencies to account for their W-2 related transportation expenditures.

•Permits the department of workforce development (DWD) to establish an advanced journeyworker credential pilot program.

•Modifies a number of provisions of state law relating to brownfields and environmental remediation tax incremental finance districts.

The provisions of the bill are more fully explained below.

Job Retention Skills Development Program

This bill requires each technical college district board to make available to all employers in the district a job retention skills development program to assist employers to retain new employes, build the job skill levels of those employes and assist those employes to attain higher wages and long-term careers. To the extent practicable, the program must be provided at employment sites.

The program must emphasize job retention skills development for employes with incomes at or below 200% of the federal poverty line who are current or former recipients of public assistance, employes in the first six months of employment with their employer and entry-level employes.

In supervising and establishing minimum requirements for the program, the state technical college system (board) must consult with employers, technical college district boards, W-2 agencies, local units of government and labor organizations. The program must include elements relating to the skills needed to show up for work on time, to work effectively in a team, to communicate with supervisors and coworkers and to solve basic job-related personal and interpersonal problems.

The bill requires the board, in consultation with employers, district boards and DWD, to develop standards to assess the job retention and skills competencies of participants before and after participation in the program. The program sunsets on December 31, 2004.

Further, the bill requires technical college district boards to assist employers in providing ongoing job retention skills development and reinforcement activities in the work place. The bill also allows district boards to charge employers a fee for the program and services offered to employers. Under the bill, $200,000 of federal temporary assistance for needy families block grant funds is used to implement the program.

Finally, the bill requires W-2 agencies to coordinate case management services that are provided to W-2 participants in unsubsidized employment with the job retention skills development program. [Sections 7, 8 , 12 and 49 (2 ).]

Productivity Enhancement Training Expense Tax Credit

This bill provides a nonrefundable business tax credit for expenses incurred by a business to provide certain training to the business's employes. 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 employes 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 employe productivity; and (2) result in employes 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 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 on or after January 1, 2000. No business may be certified for tax credits for any taxable year beginning after December 31, 2008. [Sections 15 to 20, 24 to 30, 44 and 50 (2 ).]

Applied Technology Centers

Under current law, as created by 1999 Wisconsin Act 9, technical college district boards may expend up to $5,000,000 for the purchase or construction of facilities to be used as applied technology centers without approval of voters in a referendum. To do so, the district board must adopt a resolution and gain the approval of the technical college system board. The approval process must be developed by the technical college system board in consultation with representatives of business and labor interests.

To gain approval, the district board must demonstrate all of the following:

1. That the proposed applied technology center is likely to increase or retain the number of jobs in the region that require a high level of skill and provide a high level of wages.

2. That the productivity of workers that would use the applied technology center is likely to increase.

3. That a commitment exists from businesses in the region to fund 30% of the capital costs of the applied technology center, 100% of the direct operating costs of services provided under a contract at the applied technology center and 20% of the indirect operating costs of services provided under a contract at the applied technology center.

4. That representatives of labor and business interests were consulted on the development of the proposed applied technology center.

The district board must report to the technical college system board on the changes in wages, productivity and skill levels of workers that have been directly served by the applied technology center.

Expenditures must be made before January 1, 2002.

The bill makes two changes to current law. First, the bill provides that the $5,000,000 limit does not apply to gifts, grants or federal funds. Also, the bill extends the date by which expenditures may be made to December 31, 2002. [Section 6.]

CAPCO

The certified capital company (CAPCO) program was created by 1997 Wisconsin Act 215. Under the program, an insurance company may receive a credit on its insurance premiums tax for its investments in a CAPCO if the CAPCO uses these funds from the insurer to invest as venture capital in designated small businesses in Wisconsin. These venture capital investments are referred to as "qualified investments". The bill focuses qualified investments on supporting the creation and expansion of new businesses, rather than later stage financing, by doing the following:

1. Lowering the average annual net income of a qualified business that a CAPCO may invest in from $2,000,000 to $1,000,000.

2. Precluding a CAPCO's qualified investment from being used to replace existing sources of financing.

3. Requiring a CAPCO to have professional staff based in the state to manage its investments in qualified businesses in Wisconsin to ensure that the CAPCO will be able to provide the direct assistance that a start-up business needs. [Sections 45 to 47 and 51 (1 ).]

Venture Capital Fairs

Under current law, the department of commerce may make a grant from its appropriation for community-based economic development programs to a community-based economic development organization or a private nonprofit organization for a venture capital fair if the fair will: (1) assist Wisconsin entrepreneurs or businesses in obtaining capital for the start-up or development of a business; and (2) likely stimulate investment, promote economic development or create or retain jobs in the state.

The bill establishes that an eligible venture capital fair may be local, statewide or multistate in nature and directs the department of commerce to encourage the development of regional venture fairs in the upper midwest that meet the two requirements for receipt of a grant to support a venture capital fair. [Sections 42 and 43.]

Foreign Language Immersion Grants

The bill creates a foreign language immersion grant program that requires the state superintendent of public instruction to award grants, on a competitive basis, to an educational organization or consortium of such organizations for the development and implementation of a foreign language immersion instruction program in public or private schools in grades kindergarten to six. Under the bill, the state superintendent is required to promulgate rules defining "educational organization". The bill appropriates $350,000 general purpose revenues (GPR) in the 1999-00 school year and $750,000 GPR in the 2000-01 school year for this program. [Sections 1, 2 and 33.]

Wisconsin World Geography Fund

The bill creates a onetime appropriation of $500,000 GPR in fiscal year 2000-01 for the Wisconsin world geography fund and requires the state superintendent of public instruction to enter into an agreement with the National Geographic Society Education Foundation to establish the fund. The agreement must require the foundation to manage the fund and must require the state superintendent to award a grant of $500,000 to the fund if the award is matched by the National Geographic Society. The agreement must further require that the income and appreciation of the fund be used to fund grants to educational programs in the state that improve the geographic literacy of students and teachers. The agreement must require that the National Geographic Society Education Foundation annually submit a statement of the Wisconsin world geography fund account prepared by an independent auditor to the state superintendent, along with a report on the recipients who received a grant from the fund. Finally, the agreement must provide that if the fund ceases to operate, or the state withdraws from participation, the state contribution to the fund, along with any unexpended income or appreciation of the fund attributable to the state's contribution, must be returned to the state. [Sections 1 , 3 and 32.]

W-2 Transportation Services

The bill makes the following changes in the W-2 program relating to transportation services:

• W-2 Advisory Committee on Transportation

Under current law, each W-2 agency must establish a community steering committee that, among other things, is to advise the W-2 agency concerning employment and training activities and to provide and encourage others to provide jobs and training opportunities for W-2 participants. The community steering committee must also work with W-2 participants, employers, child care providers and the community to identify child care needs, improve access to child care and expand the availability of child care.

The bill requires the community steering committee to establish an advisory committee on transportation strategies and planning. The advisory committee is to be made up of local transit or transportation providers, employers, child care providers, a representative of a community organization that serves participants in the W-2 program, a representative of a W-2 agency and other persons considered appropriate by the steering committee. The advisory committee must make recommendations to the steering committee on ways to provide affordable and sufficient transportation options to low-income workers to access employment opportunities, child care services and other services conducive to stable employment. [Section 10.]

• Accounting for Transportation Expenses

Currently, W-2 agencies are authorized to provide transportation assistance to eligible individuals. Those services are paid for out of a W-2 agency's "ancillary services" account. This ancillary services account may be used to provide other services such as job skills assessment, job coaching, employment search, emergency child care and worker's compensation premiums. Current law does not require a W-2 agency to provide an accounting of its W-2-related transportation expenses.

The bill requires W-2 agencies to provide to DWD an accounting of the amount expended on W-2-related transportation services in each contract year. [Section 11.]

• Eligibility for Transportation Assistance

Under current law, W-2 agencies may provide transportation assistance in a manner prescribed by DWD. The W-2 agency must limit any financial assistance it provides to financial assistance for public transportation if a form of public transportation is available that meets the needs of the participant. Generally, an individual is eligible for W-2 transportation assistance if the individual is a member of a "W-2 group", the gross income of which is at or below 115% of the federal poverty line.

The bill requires DWD to set the income eligibility limit for W-2 transportation assistance at or below 165% of the federal poverty line and makes noncustodial parents of dependent children in a W-2 group eligible for W-2 transportation assistance if the dependent child's custodial parent is a W-2 participant and the noncustodial parent is subject to a child support order. [Section 9.]

Advanced Journeyworker Credential Pilot Program

The bill permits DWD to establish an advanced journeyworker credential pilot program in up to three trades, crafts or businesses to recognize advanced training and postapprenticeship achievements. The bill requires DWD to submit to the legislature, by July 1, 2003, an evaluation of the effectiveness of the program.

The bill appropriates $160,000 in fiscal year 1999-00 and $120,000 in fiscal year 2000-01 and authorizes one additional full-time equivalent position for the implementation and program development of the program. [Sections 31 and 49 (1 ).]

Brownfields

The bill makes changes to the state's brownfield laws. Those changes are described below.

• Expand Protections for Local Units of Government That Involuntarily Acquire Contaminated Property

Current law generally requires a person who possesses or controls a hazardous substance that is discharged or who causes the discharge of a hazardous substance to restore the environment to the extent practicable and to minimize the harmful effects of the discharge on the environment. Current law generally exempts a local governmental unit from these clean-up requirements with respect to hazardous substance discharges on land acquired in specified ways, such as through tax delinquency proceedings and condemnation.

Current law, as amended by 1999 Wisconsin Act 9, exempts a local governmental unit that has acquired property in one of the specified ways from certain liability requirements with respect to the existence of a hazardous waste if, among other things, the waste is identified by an environmental investigation, the waste is cleaned up, the local unit of government maintains and monitors the property and does not engage in activities that are inconsistent with the maintenance of the property. The bill expands this exemption to cover the existence of solid waste, subject to the same conditions as apply to the existence of hazardous waste. [Section 39.]

• Provide Flexibility With Development Zone Tax Credits for Remediation

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.