Business & Tech
Hopes Soar as Jobs Bill Heads to Senate
HB 6525 aims to inject the economy with additional jobs through manufacturing tax benefits and student loan reimbursements for green jobs.
In yet another effort to add some spark to a lackluster economic outlook, the House has passed jobs bill HB 6525: An Act Concerning the Continuance of The Majority Leaders’ Job Growth Roundtable. The bill is now on its way to the Senate for consideration.
State Rep. Geoff Luxenberg, D-Manchester, in a June 3 press release, said: “This is one of the most important pieces of legislation this year. The fact that it received unanimous bipartisan support shows that we can work together and achieve concrete results that will help create and retain manufacturing and technology-based jobs for the long-term.”
Lori Pelletier, secretary treasurer at Connecticut AFL-CIO, whose members are located primarily in north central Connecticut, said the group lobbied for the passing of this bill.
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“Putting the bill under the authority of the majority leaders is making people want to come to the table. We’re going to see things move forward,” she said.
The bill, which was introduced by the Commerce Committee, contains the following provisions:
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- Student Loan Reimbursement: A resident who graduated on or after May 1, 2010, with a bachelor’s or associate degree from a Connecticut institution of higher education can qualify for up to $2,500 or 5 percent of annual tuition fees for four years. To be eligible, the individual must have a degree relating to green technology, life science or health information technology and be employed (for at least two years after graduation) in a related field. Unemployed individuals who are 18 and older and have a certificate in either of these fields are eligible for a grant of up to $250. To qualify, applicants should have graduated from high school before July 1, 2008 and not have been enrolled as a full-time student before July 1, 2010. Additionally, the gross annual family income should not exceed $40,000.
- Manufacturing Reinvestment Fund: A tax benefit available to 50 manufacturers with 50 or less employees. Eligible manufacturers, selected under criteria laid out by the Department of Community and Economic Development (DECD), could invest an amount less than either $50,000 or the manufacturer’s gross domestic receipts, whichever is lower. The investments, which are for the purchase of new machinery etc., are locked in for five years. When manufacturers tap the account after this period, they get a preferred tax rate of 3.5 percent, versus the 7.5 percent.
“While the bill is somewhat limited in scope, you are only eligible if you are a manufacturer with 50 or less employees and only 50 manufacturers will be accepted into the program, it is a step in the right direction. The manufacturing industry has been very challenged in Connecticut. Anything that can be done to allow them to reinvest at a preferred tax rate would help,” Thomas F. Scanlon, CPA, Borgida & Company, P.C., Manchester, said.
Christian Queen, founder/CEO of Manchester-based Highland Manufacturing, a supplier to United Technologies Corp., said the next piece of equipment he’d probably buy would cost $100,000.
“Any tax break is thinking in the right direction. But it seems too much money to put away in some account for far too long,” Queen, whose company consists of 28 employees, said.
State Sen. Tony Guglielmo R-35th District, which includes Ellington, Tolland and Vernon, felt ambivalent about the bill.
“A lot of it is soft and nice. It doesn’t hurt, but it doesn’t do a lot either,” he said. “The parts that do make sense are the student loan reimbursement and the manufacturing tax credit for investments.”
It’s hard to run down a bill that does not call for additional debt. But it’s hard to get excited when much of these recommendations have been tried and tested before. Still in the long run, economies do well when businesses do well. Any step in this direction is a welcome move during times like these.