[Congressional Record (Bound Edition), Volume 145 (1999), Part 9]
[Extensions of Remarks]
[Page 12301]
[From the U.S. Government Publishing Office, www.gpo.gov]



 A BILL TO PERMANENTLY EXTEND THE WORK OPPORTUNITY TAX CREDIT AND MAKE 
                  CERTAIN IMPROVEMENTS IN THE PROGRAM

                                 ______
                                 

                           HON. AMO HOUGHTON

                              of new york

                    in the house of representatives

                        Wednesday, June 9, 1999

  Mr. HOUGHTON. Mr. Speaker, today I am joined by my colleague from New 
York, Mr. Rangel, together with a number of other colleagues, in 
introducing our bill, The Work Opportunity Tax Credit Reform and 
Improvement Act of 1999. The bill would permanently extend the Work 
Opportunity Tax Credit and make other changes discussed below.
  After a number of improvements over the past few years, the program 
is being well received in providing employment, with training, for our 
disadvantaged. We believe the WOTC and Welfare to Work Credit (WTWC) 
programs have been very important in helping individuals become 
employed and make the transition from welfare to work. Such training 
can be costly and the credits provide an incentive to employers to hire 
the disadvantaged and provide the needed training while offsetting 
costs associated with the latter effort.
  Of course, many believe that the program would be even more 
successful if it could be extended indefinitely. Employers, both large 
and small, could depend on the program and would be more likely to seek 
out potentially qualified employees. That change would benefit 
everyone.
  We have proposed several other changes in the bill which would 
streamline and simplify the program. First, the Welfare to Work Credit 
program would be merged into WOTC, by establishing an additional 
category for WTWC. The separate Section 51A for WTWC would be repealed.
  The bill would also standardize the definition of wages based on the 
current law WTWC definition. This change broadens the definition by 
including benefits paid to the employee. The bill would also apply the 
same 40% credit rate for both the WOTC categories (first year wages of 
$6,000) and for the WTWC category (first and second year wages of 
$10,000) in the interests of simplification.
  Lastly, the bill would add ``Section 501(c)(3)'' organizations as a 
qualifying employer. The credit would be treated as an offset against 
employment tax liabilities otherwise due. It is believed that these 
organizations could hire and train many of the disadvantaged, and the 
credit would provide an incentive for such organizations to seek out 
these individuals. This provision would add a new avenue for moving 
individuals from welfare to work. Because this is a new change to the 
program, even though included in proposed legislation in the past, it 
is being proposed as a three year pilot project. This period will allow 
a period of time to determine if this feature of the overall WOTC 
program is effective and produces the desired result.
  We urge our colleagues to join us in cosponsoring this important 
legislation to extend and improve the Work Opportunity Tax Credit 
program.

                          ____________________