[Congressional Record Volume 145, Number 29 (Wednesday, February 24, 1999)]
[Senate]
[Pages S1931-S1935]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CONRAD (for himself, Mrs. Feinstein, Mr. Daschle, Mr. 
        Johnson, Mr. Reid, Mr. Sarbanes, Mrs. Boxer, Ms. Snowe, Mr. 
        Robb, Mrs. Murray, and Mr. Rockefeller):
  S. 456. A bill to amend the Internal Revenue Code of 1986 to allow 
employers a credit against income tax for information technology 
training expenses paid or incurred by the employer, and for other 
purposes; to the Committee on Finance.


                  information technology training act

  Mr. CONRAD. Mr. President, throughout the 105th Congress, the 
Administration and the Congress focused considerable attention on 
information technology (IT) issues, particularly the difficulties that 
many American companies are experiencing in recruiting skilled workers 
to fill key positions in information technology.
  The Department of Commerce, early in the 105th Congress, released a 
study, ``America's New Deficit: The Shortage of Information Technology 
Workers,'' alerting us to the severe shortage of information technology 
workers. This report was supported by a study from the Information 
Technology Association of America, ``Help Wanted 1998: A Call for 
Collaborative Action For the New Millennium,'' which estimated that 
there are more than 340,000 highly skilled positions in information 
technology that are not filled. Moreover, the Department of Labor 
projected that our economy will require more than 130,000 information 
technology jobs in three fields--systems analysts, computer scientists 
and engineers, and computer programmers--every year for the next 10 
years.
  Mr. President, the shortage of skilled high-tech workers is not 
unique to any one region of the country--Silicon Valley, Dallas, 
Atlanta, or Northern Virginia. It is a matter of urgent concern across 
the country. The shortage affects every State, every sector of the 
economy, and its impact was documented during a conference of more than 
350 educators, State officials, and business community leaders that I 
hosted last fall in Bismarck, North Dakota. The conference was 
scheduled to examine the challenges and opportunities of information 
technology in the 21st century.
  Without question, the shortage of skilled IT workers is a major 
concern for State officials and the North Dakota business community. 
During the conference, many North Dakota business leaders from firms, 
including Great Plains Software, Gateway, U.S. West, and North Central 
Data Co-op, confirmed the difficulties they are having in recruiting 
employees with qualified information technology skills. The business 
community and educators, representing all levels of education, 
emphasized the importance of expanding opportunities in information 
technology training and education.
  Last year, during the closing days of the 105th Congress, we took the 
first step to respond to the concern over the shortage of skilled high-
tech workers by increasing the annual cap on H1-B visas for foreign 
workers recruited to work in U.S. high-tech industries. As important as 
this first step is, the increase in H1-B visas by itself will not 
adequately respond to the shortage of

[[Page S1932]]

skilled workers in the U.S. Nor is it acceptable to authorize an 
increase in the number of foreign workers coming to the U.S. to fill IT 
vacancies without taking steps to ensure that American workers and 
students have opportunities to train and qualify for these excellent 
opportunities.
  Mr. President, that is why, during consideration of the American 
Competitiveness Act last year, I introduced legislation, S. 2089, to 
allow employers an income tax credit for information technology 
training expenses paid on behalf of employees or other individuals who 
are entering information technology careers. I believe it is essential 
that we provide every opportunity to American workers and individuals 
to become aware of opportunities in information technology, and to 
ensure that training and education is available at all levels. I regret 
that we did not adopt this important initiative during the 105th 
Congress.
  Today, I am introducing this legislation to provide employers a tax 
credit for information technology training. I am very pleased that 
Senators Feinstein, Johnson, Daschle, Sarbanes, Boxer, Snowe, Murray, 
Reid, and Robb are cosponsoring this important initiative. This 
legislation is also endorsed by the Information Technology Association 
of America, the Software and Information Industry Association, the 
Computing Technology Industry Association, the Information Technology 
Training Association, and the American Society For Training and 
Development.
  Under this legislation, the tax credit would be an amount equal to 20 
percent of information technology training program expenses, not to 
exceed $6,000 in a taxable year. The value of the credit would increase 
by 5 percent if the IT training program is operated in an Empowerment 
Zone, Enterprise Community, Rural Economic Area Partnership (REAP) 
zone, in a school district in which at least 50 percent of the students 
in the school district participate in the school lunch program, in an 
area designated as a disaster zone by the President or Secretary of 
Agriculture, or associated with a small business with no more than 200 
employees.
  Mr. President, last year we responded to the IT worker shortage by 
increasing the opportunities for skilled high-tech workers from other 
countries to come to the U.S. to work in the information technology 
field. Now we have an obligation to make certain that the same exciting 
opportunities in information technology are available to American 
workers and other individuals interested in information technology 
careers. I welcome additional cosponsors of this legislation, and I 
strongly urge my colleagues to incorporate this important bill in the 
tax legislation that we are expected to consider in the 106th Congress.
  Mr. President, I ask unanimous consent that the text of the bill and 
letters of support be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 S. 456

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. CREDIT FOR INFORMATION TECHNOLOGY TRAINING PROGRAM 
                   EXPENSES.

       (a) In General.--Subpart D of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     business-related credits) is amended by adding at the end the 
     following:

     ``SEC. 45D. INFORMATION TECHNOLOGY TRAINING PROGRAM EXPENSES.

       ``(a) General Rule.--For purposes of section 38, in the 
     case of an employer, the information technology training 
     program credit determined under this section is an amount 
     equal to 20 percent of information technology training 
     program expenses paid or incurred by the taxpayer during the 
     taxable year.
       ``(b) Additional Credit Percentage for Certain Programs.--
     The percentage under subsection (a) shall be increased by 5 
     percentage points for information technology training program 
     expenses paid or incurred--
       ``(1) by the taxpayer with respect to a program operated 
     in--
       ``(A) an empowerment zone or enterprise community 
     designated under part I of subchapter U,
       ``(B) a school district in which at least 50 percent of the 
     students attending schools in such district are eligible for 
     free or reduced-cost lunches under the school lunch program 
     established under the National School Lunch Act,
       ``(C) an area designated as a disaster area by the 
     Secretary of Agriculture or by the President under the 
     Disaster Relief and Emergency Assistance Act in the taxable 
     year or the 4 preceding taxable years,
       ``(D) a rural enterprise community designated under section 
     766 of the Agriculture, Rural Development, Food and Drug 
     Administration, and Related Agencies Appropriations Act, 
     1999, or
       ``(E) an area designated by the Secretary of Agriculture as 
     a Rural Economic Area Partnership Zone, or
       ``(2) by a small employer.
       ``(c) Limitation.--The amount of information technology 
     training program expenses with respect to an individual which 
     may be taken into account under subsection (a) for the 
     taxable year shall not exceed $6,000.
       ``(d) Information Technology Training Program Expenses.--
     For purposes of this section--
       ``(1) In general.--The term `information technology 
     training program expenses' means expenses paid or incurred by 
     reason of the participation of the employer in any 
     information technology training program.
       ``(2) Information technology training program.--The term 
     `information technology training program' means a program--
       ``(A) for the training of computer programmers, systems 
     analysts, and computer scientists or engineers (as such 
     occupations are defined by the Bureau of Labor Statistics),
       ``(B) involving a partnership of--
       ``(i) employers, and
       ``(ii) State training programs, school districts, 
     university systems, or certified commercial information 
     technology training providers, and
       ``(C) at least 50 percent of the costs of which is paid or 
     incurred by the employers.
       ``(3) Certified commercial information technology training 
     provider.--The term `certified commercial information 
     technology training providers' means a private sector 
     provider of educational products and services utilized for 
     training in information technology which is certified with 
     respect to--
       ``(A) the curriculum that is used for the training, or
       ``(B) the technical knowledge of the instructors of such 
     provider,
     by 1 or more software publishers or hardware manufacturers 
     the products of which are a subject of the training.
       ``(e) Small Employer.--For purposes of this section, the 
     term `small employer' means, with respect to any calendar 
     year, any employer if such employer employed 200 or fewer 
     employees on each business day in each of 20 or more calendar 
     weeks in such year or the preceding calendar year.
       ``(f) Denial of Double Benefit.--No deduction or credit 
     under any other provision of this chapter shall be allowed 
     with respect to information technology training program 
     expenses (determined without regard to the limitation under 
     subsection (c)).
       ``(g) Certain rules made applicable.--For purposes of this 
     section, rules similar to the rules of section 45A(e)(2) and 
     subsections (c), (d), and (e) of section 52 shall apply.''
       (b) Credit To Be Part of General Business Credit.--Section 
     38(b) of the Internal Revenue Code of 1986 (relating to 
     current year business credit) is amended by striking ``plus'' 
     at the end of paragraph (11), by striking the period at the 
     end of paragraph (12) and inserting ``, plus'', and by adding 
     at the end the following:
       ``(13) the information technology training program credit 
     determined under section 45D.''
       (c) No Carrybacks.--Subsection (d) of section 39 of the 
     Internal Revenue Code of 1986 (relating to carryback and 
     carryforward of unused credits) is amended by adding at the 
     end the following:
       ``(9) No carryback of section 45D credit before effective 
     date.--No portion of the unused business credit for any 
     taxable year which is attributable to the information 
     technology training program credit determined under section 
     45D may be carried back to a taxable year ending before the 
     date of the enactment of section 45D.''
       (d) Clerical Amendment.--The table of sections for subpart 
     D of part IV of subchapter A of chapter 1 of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following:

``Sec. 45D. Information technology training program expenses.''

       (e) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred after the date of 
     enactment of this Act in taxable years ending after such 
     date.
                                  ____

                                            Information Technology


                                       Association of America,

                                  Arlington, VA, February 5, 1999.
     Hon. Kent Conrad,
     Hart Senate Office Building,
     Washington, DC.
       Dear Senator Conrad: The Information Technology Association 
     of America (ITAA) and our member companies strongly support 
     tax credits for information technology (IT) training. With 
     over 346,000 IT jobs currently vacant in the United States, 
     American industry faces a severe shortage of trained IT 
     professionals. Filling these positions is imperative to the 
     growth of our national economy and securing our place as a 
     leader in the global marketplace.
       In order to grow the nation's IT workforce, we must provide 
     educational opportunities for all Americans that will allow 
     them to

[[Page S1933]]

     enter to this high-growth, high-wage industry Training is 
     readily available at both public institutions of higher 
     education and private training facilities, but many cannot 
     afford to take advantage of them.
       ITAA and our members urge you to cosponsor Senator Conrad's 
     proposed legislation that would amend the Internal Revenue 
     Code of 1986 allowing employers a credit against income tax 
     for IT training expenses paid or incurred. It is critical 
     that we do everything we can to provide affordable access to 
     IT training for all Americans. If you need any additional 
     information, please contact me at 703-284-5340 or 
     [email protected] or Bob Foust with Senator Conrad at 202-224-
     2043.
           Sincerely,
                                                 Harris N. Miller,
     President.
                                  ____

                                              Software Information


                                          Industry Association

                                Washington, DC, February 18, 1999.
     Re endorsement of information technology training tax credit 
         legislation.

     Hon. Kent Conrad,
     U.S. Senator,
     Washington, DC 20510.
       Dear Senator Conrad: Recognizing that increasing the supply 
     of highly qualified information sector workers is an 
     essential cornerstone for sustaining U.S. economic 
     prosperity, the Software & Information Industry Association 
     (SIIA) is pleased to endorse your legislative proposal to 
     encourage greater business investment in workforce skills 
     training.
       SIIA is the principal trade association of the software and 
     information industry, representing 1,400 leading high-tech 
     companies that develop and market software and electronic 
     content for business, education, entertainment and the 
     Internet. SIIA was formed Jan. 1, 1999, as a result of a 
     merger between the Software Publishers Association and 
     Information Industry Association.
       To meet the demands of the Information Age, virtually every 
     business in every economic sector is undergoing a 
     transformation that requires its workers to use modern 
     workplace technologies to achieve higher levels of 
     productivity. Unfortunately, not enough of these ``high-
     performance'' workers exist to meet increasing demand. As the 
     Department of Commerce has estimated, hundreds of thousands 
     of positions will continue to go unfilled in the next decade 
     unless we improve our ability to build and sustain a modern, 
     high-tech workforce.
       Your proposal offers an important opportunity to focus 
     national attention on this problem. It would amend the 
     Internal Revenue Code to allow employers a credit against 
     income tax for information technology training expenses paid 
     or incurred by the employer. The credit would be an amount 
     equal to 20 percent of training program expenses up to $6,000 
     a year. The credit would increase by five percent for 
     expenses paid or incurred in programs operated in specific 
     underserved locations.
       The proposal complements bills enacted in 1998 that seek to 
     improve the technical skills of high school students and 
     adult learners, provide better training opportunities for 
     incumbent and dislocated workers and ease immediate high-tech 
     worker shortages by increasing the number of foreign workers 
     allowed in the U.S. on a temporary basis. We strongly believe 
     that passage of this legislation will signal a continued 
     national commitment to creating new opportunities for 
     American workers while addressing the urgent need to 
     alleviate the undersupply of technology-proficient workers.
       We look forward to working with you and your Senate 
     colleagues to gain swift passage.
           Sincerely,
                                                 Kenneth A. Wasch,
     President.
                                  ____

                                              American Society for


                                       Training & Development,

                                                 February 2, 1999.
     Hon. Kent Conrad,
     Hart Senate Office Building, Washington, DC.
       Dear Senator Conrad: On behalf of the American Society for 
     Training & Development (ASTD), I want to thank you for 
     introducing legislation in the 106th Congress, that would 
     offer employers income tax credits that can be used to offset 
     IT training expenses.
       ASTD is the largest professional association in the field 
     of workplace learning and performance with 70,000 members who 
     work in more than 15,000 multinational corporations, small 
     and medium-sized business, government agencies, colleges and 
     universities. ASTD works with the federal government as well 
     as the business, labor and education communities to support 
     public policies and programs that encourage continuous 
     learning opportunities for all segments of the working 
     population.
       ASTD is a supporter of efforts to address the high-tech job 
     shortage. This legislation will serve as a significant 
     incentive for employer investment in continuing education 
     while providing employees with an opportunity to maintain and 
     improve skills in this rapidly advancing industry.
       ASTD appreciates your support for this important tax 
     credit. We look forward to working with you to move a bill 
     forward.
           Sincerely,
                                                    Laura Liswood,
     President and CEO.
                                  ____

                                   Information Technology Training


                                            Association, Inc.,

                                    Austin, TX, February 22, 1999.
     Hon. Kent Conrad,
     U.S. Senate,
     Washington, DC.

     Hon. Jim Moran,
     House of Representatives,
     Washington, DC.
       Dear Senator Conrad and Representative Moran: The 
     Information Technology Training Association (ITTA) 
     congratulates and thanks both of you for introducing 
     information technology training tax credit legislation in the 
     U.S. Senate and House of Representatives. In 1999 alone, our 
     380 member companies will train over 5,000,000 U.S. workers 
     on various IT topics. While most of our members are 
     responsible for providing the actual training to 
     corporations, we also represent various Fortune 1000 
     companies that conduct their own internal IT Training. More 
     than ever, we know that the value of trained and skilled IT 
     workers is crucial to the continued growth of the United 
     States in their high-tech arena. Many of our members cite 
     this as the number one problem facing their businesses today.
       Our nation's most important asset is our people. It is 
     important for the nation's economy to invest in the future of 
     its citizens and businesses. The most productive and cost 
     effective way to achieve that objective is to concentrate the 
     federal investment in incentives that most effectively help 
     citizens enter existing high-paying jobs. For that reason 
     directing this incentive to areas where jobs already exist is 
     a prudent decision. Industry studies have revealed that at 
     lest 340,000 high paying jobs are currently available. Since 
     those receiving training will find jobs waiting for them when 
     they finish their training, the country will immediately 
     begin recouping its investment in the form of additional 
     personal and corporate income taxes that would otherwise not 
     be generated.
       Tax credits are an efficient way to deliver incentives to 
     small and medium-sized businesses, which typically are unable 
     to afford the costs of IT training and lack the resources to 
     keep up with paperwork required for other support programs. 
     There is also a shortage of industry workers with technical/
     vocational IT skills. Many economically disadvantaged 
     students and displaced workers enter the industry after 
     completing single courses or series of technical courses in 
     order to acquire the skills needed to become certified.
       We also want to acknowledge our support for your decision 
     to include the private-sector IT Training providers in this 
     legislation. Due to the rapidly changing nature of 
     technology, the private sector has led the way in developing 
     successful training programs on the latest and most current 
     technologies. Many of these companies have also partnered 
     with software and hardware vendors to ensure that the 
     training on their products is accurate and of a high quality. 
     We believe that the only way to have an impact on the IT 
     worker shortage is to include all providers of training: 
     private and public.
       Your legislation is a prudent, cost-effective, and user-
     friendly tool that will simultaneously help economically 
     disadvantaged students and displaced workers, the companies 
     in our industry, U.S. competitiveness, and our trade balance. 
     We thank you for your leadership on this important issue.
           Sincerely,
                                                     Peter Squier,
     President.
                                  ____



                              CompTIA Public Policy Committee,

                                 Arlington, VA, February 22, 1999.
     Hon. Kent Conrad,
     U.S. Senate,
     Washington, DC.

     Hon. Jim Moran,
     House of Representatives,
     Washington, DC.
       Dear Senator Conrad and Representative Moran: The Computing 
     Technology Industry Association (CompTIA) congratulates and 
     thanks both of you for introducing technology training tax 
     credit legislation in the US Senate and House of 
     Representatives. CompTIA represents 7,800 computer and 
     semiconductor manufacturers, distributors, software 
     publishers, resellers, retailers, Internet, long distance 
     training and other service companies. We believe that 
     productive investment in education and training are critical 
     to maintaining US economic strength.
       Our nation's most important asset is our people. It is 
     important for the nation's economy to invest in the future of 
     its citizens and businesses. The most productive and cost 
     effective way to achieve that objective is to concentrate the 
     federal investment in incentives that most effectively help 
     citizens enter existing high-paying jobs. For that reason 
     directing this incentive to areas where jobs already exist is 
     a prudent decision. Industry studies have revealed that at 
     least 340,000 high paying jobs are currently available. Since 
     those receiving training will find jobs waiting for them when 
     they finish their training, the country will immediately 
     begin recouping its investment in the form of additional 
     personal and corporate income taxes that would otherwise not 
     be generated.
       Tax credits are an efficient way to deliver incentives to 
     small businesses, which typically are unable to afford the 
     high costs of technology training and lack the manpower to 
     keep up with paperwork required to qualify for other support 
     programs. There is also

[[Page S1934]]

     a shortage of industry workers with technical/vocational IT 
     skills. Many economically disadvantaged students and 
     displaced workers enter the industry after completing single 
     courses or series of technical courses in order to acquire 
     the skills needed to become certified. CompTIA is currently 
     assisting in school-to-work programs in over 100 high schools 
     and assisting the Head Start program at the Department of 
     Labor develop introductory IT certifications for their 
     constituents.
       Your legislation is a prudent, cost-effective, and user-
     friendly tool that will simultaneously help economically 
     disadvantaged students and displaced workers, the companies 
     in our industry, US competitiveness, and our trade balance. 
     We thank you for your leadership on this important issue.
           Sincerely,
                                                     Alan P. Hald,
     Chairman, CompTIA Public Policy Committee.
                                  ____



                                     Sundog Interactive, Inc.,

                                     Fargo, ND, February 24, 1999.

           Proposed Legislation Would Help High-Tech Startups

       Fargo, N.D.--A shortage of high-tech employees has eclipsed 
     job creation as one of the most pressing economic issues in 
     many areas of the country, especially in rural states like 
     North Dakota. A bill to be introduced by Sen. Kent Conrad 
     would help high-tech startups train and retain highly-skilled 
     information technology (IT) workers.
       In North Dakota, the farm crisis is driving many young 
     people out of the state, and economic conditions make it more 
     difficult for companies to compete for top talent.
       One company that has seen firsthand how difficult it can be 
     to find and keep skilled IT workers is Fargo-based new media 
     and software developer Sundog Interactive. As a high-tech 
     startup in the heart of America's breadbasket, Sundog is 
     forced to compete with much larger firms on a national level, 
     not only for clients but also for talent.
       ``From the outside, Fargo might not seem like an ideal 
     location to start a high-tech company,'' explains Brent 
     Teiken, Sundog Interactive's cofounder and president. ``But 
     our community has three major colleges and universities and a 
     large technical college, so we produce a high level of 
     educated, skilled and motivated young people. Unfortunately, 
     many of these bright minds leave the area after graduation 
     because employers in larger metropolitan areas can offer 
     higher salaries and better benefits. The tax credit 
     legislation Senator Conrad is proposing should help level the 
     playing field.''
       Sen. Conrad's bill would allow high-tech companies like 
     Sundog Interactive to earn tax credits on the information 
     technology training they provide employees.
       ``In the long run, everybody would win,'' Teiken says. ``We 
     already rely on our area universities for qualified interns. 
     This legislation would provide an incentive to keep doing 
     that--and the working capital to grow our company and offer 
     more competitive salaries as a result. Students would gain 
     real-world knowledge and experience they could take with them 
     wherever they go. And more students would consider remaining 
     in the state after graduation, since employers here would be 
     able to afford better wages.''
       Teiken is scheduled to appear with Sen. Conrad at his press 
     conference on Wednesday, February 24, 1999, in Washington, 
     D.C., in support of the senator's proposed legislation. 
     Teiken is also a member of the North Dakota Information 
     Technology Council, a group Sen. Conrad helped organize to 
     address IT concerns in the state.
       To learn more about Sundog Interactive, visit the company's 
     Web site at http://www.sundoginteractive.com. The News 
     section of the site includes a feature story which provides 
     Teiken's perspective on the future of information technology 
     in the state.
                                  ____


Cisco Systems CEO Chambers: High-Tech Training Key to Prosperity in the 
                            Internet Economy


          bi-partisan senate bill demonstrates u.s. leadership

       Washington, DC.--February 24, 1999--Cisco Systems CEO and 
     President John Chambers today hailed a bi-partisan effort in 
     the Senate to focus on high-tech job-training and education 
     programs.
       ``As the Internet Economy takes shape, there is a critical 
     need to prepare our workers for the jobs of tomorrow. There 
     is already a shortage of skilled high-tech workers and more 
     than 1.8 million new jobs will be created as the Internet 
     Economy transforms our economy,'' said Chambers.
       With these challenges ahead, Chambers praised lawmakers for 
     ensuring that policymakers will address the pressing need for 
     training and education.
       ``I salute Sen. Kent Conrad--along with Sen. Olympia Snowe, 
     Sen. Dianne Feinstein, Sen. Barbara Boxer and others--for 
     highlighting the need for the government and the private 
     sector to partner to train workers for the Internet 
     Economy,'' he added.
       Cisco Systems, the worldwide leader in networking for the 
     Internet, has already worked with Sen. Conrad on a number of 
     high-tech initiatives, including the establishment of a Cisco 
     Networking Academy in the State of North Dakota. The Cisco 
     Networking Academy program, currently in 1,200 high schools 
     across the country, teaches high-tech skills to students.
       About 17,000 students are currently in the Networking 
     Academy program and Cisco expects more than 2,000 students to 
     graduate in 1999.
       ``The kind of training Sen. Conrad and his colleagues are 
     encouraging through this legislation will allow students to 
     learn skills needed for jobs in high-technology companies and 
     help current employees to be retrained to meet the needs of 
     21st Century jobs,'' said Chambers.
                                  ____



                                        Great Plains Software,

                                     Fargo, ND, February 23, 1999.
     Re tax credit for information technology training expenses.

     Senator Kent Conrad,
     Hart Senate Office Building,
     Washington, DC.
       Dear Senator Conrad: We have reviewed the legislation 
     drafted and sponsored by yourself, along with Senators 
     Feinstein, Boxer, Johnson, Daschle and Sarbanes which would 
     provide tax credits to businesses that train workers in 
     information technology skills. As the largest technology-
     based employer in North Dakota, we support this legislation. 
     While benefit to our Company may be modest, smaller, start-up 
     technology companies, especially those in rural areas of our 
     state, should see substantial benefits.
       As you know, American industry faces a severe shortage of 
     information training (IT) professionals. Any legislation 
     which addresses this issue is welcome.
       Please feel free to note our Company's support of your 
     legislation publicly.
           Very truly yours,
                                                Douglas R. Herman,
                                                  General Counsel.

  Mrs. FEINSTEIN. Mr. President, I rise today alongside my colleague 
from North Dakota in support of S. 456, the Information Technology Tax 
Credit bill, which provides employers with a tax credit for information 
technology training for their employees.
  The purpose of this legislation is quite simple: To assist American 
companies which are having difficulty in recruiting skilled workers to 
fill positions in the information technology field.
  Information technology--including computer programmers, systems 
analysts, computer scientists and engineers--is a critical ingredient 
in the growth of the U.S. economy as well as the economy of California. 
A field that barely existed a few decades ago, information technologies 
are now among the most important emerging technologies in the world.
  Information technology now accounts for more than $500 billion a year 
to U.S. economy, and one-third of all new jobs created since 1992 are 
in computers, semiconductors, software, and communications equipment.
  According to recent studies, ``e-commerce'' is projected to grow from 
$2.6 billion in 1996 to over $220 billion in 2001--explosive growth 
that will generate countless additional jobs.
  And, just as important, many information technology jobs tend to be 
high value added, high-wage.
  Last year California alone was responsible for sales of approximately 
$125 billion in high-tech production--almost than double 1992's $64 
billion in sales.
  Computer services--just one sector of the IT economy--have created 
100,000 jobs in California in the past five years. There are now over 
400,000 people in California employed directly in high-tech 
manufacturing jobs. When information technology business service jobs 
are added into the mix, there are currently over 700,000 information 
technology jobs in California, according to the Center for the 
Continuing Study of the California Economy.
  And yet, despite this explosive growth--or perhaps because of it--
America is simply not producing enough skilled and able workers to meet 
the needs of the information technology field.
  Last year the Information Technology Association of America releases 
a study which estimated that there are more than 340,000 high skilled 
positions in the information technology field that are not filled.
  And the Department of Labor has projected that our economy will 
require more than 130,000 information technology jobs in just three 
fields--computer scientists and engineers, systems analysts, and 
computer programmers--every year for the next decade.
  One of the most sobering experiences of my Senate career occurred 
last year when I was told point blank by the CEO's of several large 
California high-tech companies that the United States is simply not 
producing a sufficient number of skilled and educated workers to fill 
the information technology positions that their companies need to fill 
if they were to be able to continue

[[Page S1935]]

to grow and successfully compete in the international economy.
  To meet the needs of these companies, last year Congress had to 
revise the cap on H1B visas to allow foreign professional and skilled 
workers who had the education and skills to fill these information 
technology positions to come to the United States.
  While raising the H1B visa cap may meet the short term needs of these 
companies and of the economy, it is not a long-term solution to this 
problem.
  To avoid the danger of a ``hollowing out'' the U.S. workforce we must 
invest more in the education and training of American workers so that 
they have the education and skills needed for the information 
technology jobs which make up the backgone of the new high-tech 
economy.
  We must make sure that new workers entering the workforce have the 
skills they need to match with the jobs they want to be able to get. We 
must focus on retraining unemployed, older, and displaced workers, and 
encourage new partnerships between the IT industry and educational 
institutions. And we must reach out to those who have been left out to 
make sure that they have the training they need to join in our current 
economic prosperity.
  To meet these needs, this legislation provides a tax credit for 
employers who offer information technology training for individuals, 
equal to 20 percent of the information technology training program 
expense, capped to $6,000 in a calender year.
  And, to help those who may have been excluded from the economy of 
today take their place in the economy of tomorrow, it provides a 5 
percent increase in the value of the credit as an additional incentive 
for training in empowerment zones or enterprise communities.
  The current strength of U.S. information technology industry comes, 
in large part, from a long and successful partnership between 
government, educational institutions, and industry.
  This legislation builds on that partnership to both meet our current 
needs and to train the next generation of information technology 
workers, and to maintain the U.S. economy's strength and leadership in 
the twenty-first century.
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