To provide job creation and assistance, and for other purposes.

January 4, 2005

Mr. MCHUGH introduced the following bill; which was referred to the Committee on Education and the Workforce, and in addition to the Committees on Ways and Means, Judiciary, and Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

To provide job creation and assistance, and for other purposes.

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

SECTION 1. SHORT TITLE.

This Act may be cited as the `Rural America Job Assistance and Creation Act'.

SEC. 2. GRANTS FOR REGIONAL SKILLS ALLIANCE SKILL DEVELOPMENT.

(a) Authorization-

(1) IN GENERAL- The Secretary of Labor, in consultation with the Secretary of Commerce, shall award grants to eligible entities described in subsection (b) to assist such entities to improve the job skills necessary for employment in specific industries.

(2) ELIGIBLE ENTITIES DESCRIBED-

(A) IN GENERAL- An eligible entity described in this subsection is a consortium that--

(i) shall consist of representatives from not less than 5 businesses, or a lesser number of businesses if such lesser number of businesses employs at least 30 percent of the employees in the industry involved in the region (or a nonprofit organization that represents such businesses);

(ii) may consist of representatives from--

(I) labor organizations;

(II) State and local government; and

(III) educational institutions;

(iii) is established to serve one or more particular industries; and

(iv) is established to serve a particular geographic region.

(B) MAJORITY OF REPRESENTATIVES- A majority of the representatives comprising the consortium shall be representatives described in subparagraph (A)(i).

(3) PRIORITY FOR SMALL BUSINESSES- In providing grants under paragraph (1), the Secretary of Labor shall give priority to an eligible entity if a majority of representatives forming the entity represent small-business concerns (as defined in section 3(a) of the Small Business Act (15 U.S.C. 632(a))).

(4) MAXIMUM AMOUNT OF GRANT- The amount of a grant awarded to an eligible entity under paragraph (1) may not exceed $1,000,000 for any fiscal year.

(b) Use of Amounts-

(1) IN GENERAL- The Secretary of Labor may not award a grant under subsection (a) to an eligible entity unless such entity agrees to use amounts received from such grant to improve the job skills necessary for employment by businesses in the industry with respect to which such entity was established.

(2) CONDUCT OF PROGRAM-

(A) IN GENERAL- In carrying out the program described in paragraph (1), the eligible entity may provide for--

(i) an assessment of training and job skill needs for the industry;

(ii) the development of a sequence of skill standards that are benchmarked to advanced industry practices;

(iii) the development of curriculum and training methods, including, where appropriate, e-learning or technology-based training;

(iv) the purchase, lease, or receipt of donations of training equipment;

(v) the identification of training providers and the development of partnerships between the industry and educational institutions, including community colleges;

(vi) the development of apprenticeship programs;

(vii) the development of training programs for workers, including dislocated workers;

(viii) the development of training plans for businesses; and

(ix) the development of the membership of the entity.

(B) ADDITIONAL REQUIREMENT- In carrying out the program described in paragraph (1), the eligible entity shall provide for the development and tracking of performance outcome measures for the program and the training providers involved in the program.

(3) ADMINISTRATIVE COSTS- The eligible entity may use not more than 10 percent of the amount of a grant to pay for administrative costs associated with the program described in paragraph (1).

(c) Requirement of Matching Funds-

(1) IN GENERAL- The Secretary of Labor may not award a grant under subsection (a) to an eligible entity unless such entity agrees that the entity will make available non-Federal contributions toward the costs of carrying out activities under the grant in an amount that is not less than $2 for each $1 of Federal funds provided under the grant, of which--

(A) $1 shall be provided by the businesses participating in the entity; and

(B) $1 shall be provided by the State or local government involved.

(2) OTHER CONTRIBUTIONS-

(A) EQUIPMENT- Equipment donations to facilities that are not owned or operated by the members of the eligible entity involved and that are shared by such members may be included in determining compliance with paragraph (1).

(B) LIMITATION- An eligible entity may not include in-kind contributions in complying with the requirement of paragraph (1). The Secretary of Labor may consider such donations in ranking applications.

(d) Limit on Administrative Expenses- The Secretary of Labor may use not more than 5 percent of the amounts made available to carry out this section to pay the Federal administrative costs associated with awarding grants under this section.

(e) Authorization of Appropriations- There are authorized to be appropriated to carry out this section $50,000,000 for each of fiscal years 2006, 2007, and 2008, and such sums as are necessary for each fiscal year thereafter.

SEC. 3. GRANTS FOR REGIONAL SKILLS ALLIANCE PLANNING.

(a) Authorization-

(1) IN GENERAL- The Secretary of Labor, in consultation with the Secretary of Commerce, shall award grants to States to enable such States to assist businesses, organizations, and agencies described in section 2(a)(2) in conducting planning to form consortia described in such section.

(2) MAXIMUM AMOUNT OF GRANT- The amount of a grant awarded to a State under paragraph (1) may not exceed $500,000 for any fiscal year.

(b) Application- The Secretary of Labor may not award a grant under subsection (a) to a State unless such State submits to the Secretary an application at such time, in such manner, and containing such information as the Secretary may reasonably require.

(c) Requirement of Matching Funds- The Secretary of Labor may not award a grant under subsection (a) to a State unless such State agrees that it will make available non-Federal contributions toward the costs of carrying out activities under this section in an amount that is not less than $1 for each $1 of Federal funds provided under the grant.

(d) Authorization of Appropriations- There are authorized to be appropriated to carry out this section $5,000,000 for fiscal year 2006.

SEC. 4. GRANTS FOR SUPPORT OF BUSINESS INCUBATOR ACTIVITIES.

(a) Purpose- It is the purpose of this section to encourage entrepreneurial creativity and risk taking through the support of the furnishing of business incubator services for newly established small businesses and medium-sized businesses.

(b) Grant Program- To achieve the purpose of this section, the Secretary of Commerce shall carry out a program to provide, through grants, financial assistance for the establishment and support of entities that provide business incubator services in support of the initiation and initial sustainment of business activities by newly established small businesses and medium-sized businesses.

(c) Awards of Grants-

(1) ELIGIBILITY REQUIREMENTS- The Secretary shall prescribe the eligibility requirements for the awarding of grants under this section.

(2) COMPETITIVE SELECTION- The Secretary shall use a competitive process for the awarding of grants under this section and, under that process, select recipients of the grants on the basis of merit, with priority given to underserved rural and urban communities.

(3) APPLICATIONS FOR GRANTS- The Secretary shall prescribe the form and content of applications required for grants under this section.

(d) Additional Administrative Authorities-

(1) COST-SHARING- The Secretary may require the recipient of a grant under this section to defray a specific level of its operating expenses for business incubator services out of funds available from sources other than the Federal Government.

(2) ADDITIONAL TERMS AND CONDITIONS- The Secretary, in awarding a grant, may impose any other terms and conditions for the use of the proceeds of the grant that the Secretary determines appropriate for carrying out the purpose of this section and to protect the interests of the United States, including the requirement that entities providing business incubator services that receive a grant under this section develop a plan for ultimately becoming self-sufficient.

(e) Definitions- In this section:

(1) BUSINESS INCUBATOR SERVICES- The term `business incubator services' includes professional and technical services necessary for the initiation and initial sustainment of operations of a newly established business, including such services as the following:

(A) LEGAL SERVICES- Legal services, including aid in preparing corporate charters, partnership agreements, and basic contracts.

(B) INTELLECTUAL PROPERTY SERVICES- Services in support of the protection of intellectual property through patents, trademarks, or otherwise.

(C) TECHNOLOGY SERVICES- Services in support of the acquisition and use of advanced technology, including the use of Internet services and web-based services.

(D) PLANNING- Advice on--

(i) strategic planning; and

(ii) marketing, including advertising.

(2) SMALL BUSINESS AND MEDIUM-SIZED BUSINESS-

(A) SECRETARY TO PRESCRIBE- The Secretary shall prescribe the definitions of the terms `small business' and `medium-sized business' for the purpose of this section.

(B) SMALL BUSINESS STANDARDS- In defining the term `small business' for the purpose of this section, the Secretary shall apply the standards applicable for the definition of the term `small-business concern' under section 3 of the Small Business Act (15 U.S.C. 632).

(3) SECRETARY- The term `Secretary' means the Secretary of Commerce.

(f) Regulations- The Secretary shall prescribe regulations for the grant program administered under this section.

(g) Authorization of Appropriations- There are authorized to be appropriated for the Department of Commerce to carry out this section $50,000,000 for fiscal year 2006, and $200,000,000 for each fiscal year thereafter.

SEC. 5. NOTIFICATION OF FEDERAL AND STATE ELECTED OFFICIALS PRIOR TO DISLOCATION OF WORKERS.

Section 3(a)(2) of the Worker Adjustment and Retraining Notification Act (29 U.S.C. 2102(a)(2)) is amended by inserting `Federal, State, and' after `the unit of'.

SEC. 6. SUBMISSION OF H-1B LABOR CONDITION APPLICATION AT SAME TIME AS CLASSIFICATION PETITION.

Section 212(n)(1) of the Immigration and Nationality Act (8 U.S.C. 1182(n)(1)) is amended by adding at the end the following: `The application under this paragraph shall be submitted by an employer at the same time as the classification petition is filed under section 214 relating to the H-1B nonimmigrants who are the subject of the application.'.

SEC. 7. EXCLUSION FROM INCOME OF SEVERANCE PAYMENT AMOUNTS.

(a) In General- Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items specifically excluded from gross income) is amended by inserting after section 139 the following new section:

`SEC. 139A. SEVERANCE PAYMENTS.

`(a) In General- In the case of an individual, gross income shall not include any qualified severance payment.

`(b) Limitation- The amount to which the exclusion under subsection (a) applies shall not exceed $25,000 with respect to each separation from employment described in subsection (c)(1)(B).

`(c) Qualified Severance Payment- For purposes of this section--

`(1) IN GENERAL- The term `qualified severance payment' means any payment received by an individual if--

`(A) such payment was paid by such individual`s employer on account of such individual's separation from employment, and

`(B) such separation was in connection with a reduction in the work force of the employer.

`(2) LIMITATION- Such term shall not include any payment received by an individual if the aggregate payments received with respect to the separation from employment exceed $150,000.'.

(b) Clerical Amendment- The table of sections for part III of subchapter B of chapter 1 of such Code is amended by inserting after the item relating to section 139 the following new items:

`139A. Severance payments.'

(c) Effective Date- The amendments made by this section shall apply to taxable years beginning after December 31, 2005.

SEC. 8. EXPANSION OF WORK OPPORTUNITY TAX CREDIT.

(a) In General- Section 51(d)(1) of the Internal Revenue Code of 1986 (relating to members of targeted groups) is amended by striking `or' at the end of subparagraph (G), by striking the period at the end of subparagraph (H) and inserting `, or', and by adding at the end the following:

`(I) a qualified small business employee.'.

(b) Qualified Small Business Employee- Section 51(d) of the Internal Revenue Code of 1986 is amended by redesignating paragraphs (10) through (12) as paragraphs (11) through (13), respectively, and by inserting after paragraph (9) the following:

`(10) QUALIFIED SMALL BUSINESS EMPLOYEE-

`(A) IN GENERAL- The term `qualified small business employee' means any individual--

`(i) hired by a qualified small business located in a development zone, or

`(ii) hired by a qualified small business and who is certified by the designated local agency as residing in such a development zone.

`(B) QUALIFIED SMALL BUSINESS- The term `qualified small business' has the meaning given the term `small employer' by section 4980D(d)(2).

`(C) DEVELOPMENT ZONE- For purposes of this section--

`(i) IN GENERAL- The term `development zone' means any area--

`(I) which is nominated under the procedures defined in sections 1400E(a)(1)(A) and 1400E(a)(4) for renewal communities;

`(II) which the Secretary of Housing and Urban Development designates as a development zone, after consultation with the Secretary of Commerce;

`(III) which has a population of not less than 5,000 and not more than 150,000;

`(IV) which has a poverty rate not less than 20 percent (within the meaning of section 1400E(c)(3)(C));

`(V) which has an average annual rate of job growth of less than 2 percent during any 3 years of the preceding 5-year period; and

`(VI) which, during the period beginning January 1, 1990 and ending with the date of the enactment of this section, has a net out-migration of inhabitants, or other population loss, from the area of at least 2 percent of the population of the area during such period.

`(ii) NUMBER OF DESIGNATIONS- The Secretary of Housing and Urban Development may not designate more than 100 development zones.

`(D) SPECIAL RULES FOR DETERMINING AMOUNT OF CREDIT- For purposes of applying this subpart to wages paid or incurred to any qualified small business employee--

`(i) subsection (a) shall be applied by substituting `20 percent of the qualified first, second, third, fourth, or fifth year wages' for `40 percent of the qualified first year wages', and

`(ii) in lieu of paragraphs (2) and (3) of subsection (b), the following definitions and special rule shall apply:

`(I) QUALIFIED FIRST-YEAR WAGES- The term `qualified first-year wages' means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning with the day the individual begins work for the employer.

`(II) QUALIFIED SECOND-YEAR WAGES- The term `qualified second-year wages' means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning on the day after the last day of the 1-year period with respect to such individual determined under subclause (I).

`(III) QUALIFIED THIRD-YEAR WAGES- The term `qualified third-year wages' means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning on the day after the last day of the 1-year period with respect to such individual determined under subclause (II).

`(IV) QUALIFIED FOURTH-YEAR WAGES- The term `qualified fourth-year wages' means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning on the day after the last day of the 1-year period with respect to such individual determined under subclause (III).

`(V) QUALIFIED FIFTH-YEAR WAGES- The term `qualified fifth-year wages' means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning on the day after the last day of the 1-year period with respect to such individual determined under subclause (IV).

`(VI) ONLY FIRST $15,000 OF WAGES PER YEAR TAKEN INTO ACCOUNT- The amount of the qualified first, second, third, fourth, and fifth year wages which may be taken into account with respect to any individual shall not exceed $15,000 per year.'.

(c) Effective Date- The amendments made by this section shall apply to individuals who begin work for the employer after the date of enactment of this Act.

END