I 

109TH CONGRESS 

1ST SESSION H. R. 143 

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

IN THE HOUSE OF REPRESENTATIVES 

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 

A BILL 

To provide job creation and assistance, and for other 

purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Rural America Job 

5 Assistance and Creation Act’’. 

6 SEC. 2. GRANTS FOR REGIONAL SKILLS ALLIANCE SKILL 

7 DEVELOPMENT. 

8 (a) AUTHORIZATION.— 
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1 (1) IN GENERAL.—The Secretary of Labor, in 

2 consultation with the Secretary of Commerce, shall 

3 award grants to eligible entities described in sub4 section (b) to assist such entities to improve the job 

5 skills necessary for employment in specific indus6 tries. 

7 (2) ELIGIBLE ENTITIES DESCRIBED.— 

8 (A) IN GENERAL.—An eligible entity de9 scribed in this subsection is a consortium 

10 that— 

11 (i) shall consist of representatives 

12 from not less than 5 businesses, or a lesser 

13 number of businesses if such lesser number 

14 of businesses employs at least 30 percent 

15 of the employees in the industry involved 

16 in the region (or a nonprofit organization 

17 that represents such businesses); 

18 (ii) may consist of representatives 

19 from— 

20 (I) labor organizations; 

21 (II) State and local government; 

22 and 

23 (III) educational institutions; 

24 (iii) is established to serve one or 

25 more particular industries; and 
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1 (iv) is established to serve a particular 

2 geographic region. 

3 (B) MAJORITY OF REPRESENTATIVES.—A 

4 majority of the representatives comprising the 

5 consortium shall be representatives described in 

6 subparagraph (A)(i). 

7 (3) PRIORITY FOR SMALL BUSINESSES.—In 

8 providing grants under paragraph (1), the Secretary 

9 of Labor shall give priority to an eligible entity if a 

10 majority of representatives forming the entity rep11 resent small-business concerns (as defined in section 

12 3(a) of the Small Business Act (15 U.S.C. 632(a))). 

13 (4) MAXIMUM AMOUNT OF GRANT.—The 

14 amount of a grant awarded to an eligible entity 

15 under paragraph (1) may not exceed $1,000,000 for 

16 any fiscal year. 

17 (b) USE OF AMOUNTS.— 

18 (1) IN GENERAL.—The Secretary of Labor may 

19 not award a grant under subsection (a) to an eligible 

20 entity unless such entity agrees to use amounts re21 ceived from such grant to improve the job skills nec22 essary for employment by businesses in the industry 

23 with respect to which such entity was established. 

24 (2) CONDUCT OF PROGRAM.— 
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1 (A) IN GENERAL.—In carrying out the 

2 program described in paragraph (1), the eligible 

3 entity may provide for— 

4 (i) an assessment of training and job 

5 skill needs for the industry; 

6 (ii) the development of a sequence of 

7 skill standards that are benchmarked to 

8 advanced industry practices; 

9 (iii) the development of curriculum 

10 and training methods, including, where ap11 propriate, e-learning or technology-based 

12 training; 

13 (iv) the purchase, lease, or receipt of 

14 donations of training equipment; 

15 (v) the identification of training pro16 viders and the development of partnerships 

17 between the industry and educational insti18 tutions, including community colleges; 

19 (vi) the development of apprenticeship 

20 programs; 

21 (vii) the development of training pro22 grams for workers, including dislocated 

23 workers; 

24 (viii) the development of training 

25 plans for businesses; and 
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1 (ix) the development of the member2 ship of the entity. 

3 (B) ADDITIONAL REQUIREMENT.—In car4 rying out the program described in paragraph 

5 (1), the eligible entity shall provide for the de6 velopment and tracking of performance outcome 

7 measures for the program and the training pro8 viders involved in the program. 

9 (3) ADMINISTRATIVE COSTS.—The eligible enti10 ty may use not more than 10 percent of the amount 

11 of a grant to pay for administrative costs associated 

12 with the program described in paragraph (1). 

13 (c) REQUIREMENT OF MATCHING FUNDS.— 

14 (1) IN GENERAL.—The Secretary of Labor may 

15 not award a grant under subsection (a) to an eligible 

16 entity unless such entity agrees that the entity will 

17 make available non-Federal contributions toward the 

18 costs of carrying out activities under the grant in an 

19 amount that is not less than $2 for each $1 of Fed20 eral funds provided under the grant, of which— 

21 (A) $1 shall be provided by the businesses 

22 participating in the entity; and 

23 (B) $1 shall be provided by the State or 

24 local government involved. 

25 (2) OTHER CONTRIBUTIONS.— 
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1 (A) EQUIPMENT.—Equipment donations to 

2 facilities that are not owned or operated by the 

3 members of the eligible entity involved and that 

4 are shared by such members may be included in 

5 determining compliance with paragraph (1). 

6 (B) LIMITATION.—An eligible entity may 

7 not include in-kind contributions in complying 

8 with the requirement of paragraph (1). The 

9 Secretary of Labor may consider such dona10 tions in ranking applications. 

11 (d) LIMIT ON ADMINISTRATIVE EXPENSES.—The 

12 Secretary of Labor may use not more than 5 percent of 

13 the amounts made available to carry out this section to 

14 pay the Federal administrative costs associated with 

15 awarding grants under this section. 

16 (e) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated to carry out this section 

18 $50,000,000 for each of fiscal years 2006, 2007, and 

19 2008, and such sums as are necessary for each fiscal year 

20 thereafter. 

21 SEC. 3. GRANTS FOR REGIONAL SKILLS ALLIANCE PLAN22 NING. 

23 (a) AUTHORIZATION.— 

24 (1) IN GENERAL.—The Secretary of Labor, in 

25 consultation with the Secretary of Commerce, shall 
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1 award grants to States to enable such States to as2 sist businesses, organizations, and agencies de3 scribed in section 2(a)(2) in conducting planning to 

4 form consortia described in such section. 

5 (2) MAXIMUM AMOUNT OF GRANT.—The 

6 amount of a grant awarded to a State under para7 graph (1) may not exceed $500,000 for any fiscal 

8 year. 

9 (b) APPLICATION.—The Secretary of Labor may not 

10 award a grant under subsection (a) to a State unless such 

11 State submits to the Secretary an application at such 

12 time, in such manner, and containing such information as 

13 the Secretary may reasonably require. 

14 (c) REQUIREMENT OF MATCHING FUNDS.—The Sec15 retary of Labor may not award a grant under subsection 

16 (a) to a State unless such State agrees that it will make 

17 available non-Federal contributions toward the costs of 

18 carrying out activities under this section in an amount 

19 that is not less than $1 for each $1 of Federal funds pro20 vided under the grant. 

21 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

22 are authorized to be appropriated to carry out this section 

23 $5,000,000 for fiscal year 2006. 
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1 SEC. 4. GRANTS FOR SUPPORT OF BUSINESS INCUBATOR 

2 ACTIVITIES. 

3 (a) PURPOSE.—It is the purpose of this section to 

4 encourage entrepreneurial creativity and risk taking 

5 through the support of the furnishing of business incu6 bator services for newly established small businesses and 

7 medium-sized businesses. 

8 (b) GRANT PROGRAM.—To achieve the purpose of 

9 this section, the Secretary of Commerce shall carry out 

10 a program to provide, through grants, financial assistance 

11 for the establishment and support of entities that provide 

12 business incubator services in support of the initiation and 

13 initial sustainment of business activities by newly estab14 lished small businesses and medium-sized businesses. 

15 (c) AWARDS OF GRANTS.— 

16 (1) ELIGIBILITY REQUIREMENTS.—The Sec17 retary shall prescribe the eligibility requirements for 

18 the awarding of grants under this section. 

19 (2) COMPETITIVE SELECTION.—The Secretary 

20 shall use a competitive process for the awarding of 

21 grants under this section and, under that process, 

22 select recipients of the grants on the basis of merit, 

23 with priority given to underserved rural and urban 

24 communities. 
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1 (3) APPLICATIONS FOR GRANTS.—The Sec2 retary shall prescribe the form and content of appli3 cations required for grants under this section. 

4 (d) ADDITIONAL ADMINISTRATIVE AUTHORITIES.— 

5 (1) COST-SHARING.—The Secretary may re6 quire the recipient of a grant under this section to 

7 defray a specific level of its operating expenses for 

8 business incubator services out of funds available 

9 from sources other than the Federal Government. 

10 (2) ADDITIONAL TERMS AND CONDITIONS.— 

11 The Secretary, in awarding a grant, may impose any 

12 other terms and conditions for the use of the pro13 ceeds of the grant that the Secretary determines ap14 propriate for carrying out the purpose of this section 

15 and to protect the interests of the United States, in16 cluding the requirement that entities providing busi17 ness incubator services that receive a grant under 

18 this section develop a plan for ultimately becoming 

19 self-sufficient. 

20 (e) DEFINITIONS.—In this section: 

21 (1) BUSINESS INCUBATOR SERVICES.—The 

22 term ‘‘business incubator services’’ includes profes23 sional and technical services necessary for the initi24 ation and initial sustainment of operations of a 
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1 newly established business, including such services 

2 as the following: 

3 (A) LEGAL SERVICES.—Legal services, in4 cluding aid in preparing corporate charters, 

5 partnership agreements, and basic contracts. 

6 (B) INTELLECTUAL PROPERTY SERV7 ICES.—Services in support of the protection of 

8 intellectual property through patents, trade9 marks, or otherwise. 

10 (C) TECHNOLOGY SERVICES.—Services in 

11 support of the acquisition and use of advanced 

12 technology, including the use of Internet serv13 ices and web-based services. 

14 (D) PLANNING.—Advice on— 

15 (i) strategic planning; and 

16 (ii) marketing, including advertising. 

17 (2) SMALL BUSINESS AND MEDIUM-SIZED BUSI18 NESS.— 

19 (A) SECRETARY TO PRESCRIBE.—The Sec20 retary shall prescribe the definitions of the 

21 terms ‘‘small business’’ and ‘‘medium-sized 

22 business’’ for the purpose of this section. 

23 (B) SMALL BUSINESS STANDARDS.—In de24 fining the term ‘‘small business’’ for the pur25 pose of this section, the Secretary shall apply 
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1 the standards applicable for the definition of 

2 the term ‘‘small-business concern’’ under sec3 tion 3 of the Small Business Act (15 U.S.C. 

4 632). 

5 (3) SECRETARY.—The term ‘‘Secretary’’ means 

6 the Secretary of Commerce. 

7 (f) REGULATIONS.—The Secretary shall prescribe 

8 regulations for the grant program administered under this 

9 section. 

10 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

11 are authorized to be appropriated for the Department of 

12 Commerce to carry out this section $50,000,000 for fiscal 

13 year 2006, and $200,000,000 for each fiscal year there14 after. 

15 SEC. 5. NOTIFICATION OF FEDERAL AND STATE ELECTED 

16 OFFICIALS PRIOR TO DISLOCATION OF 

17 WORKERS. 

18 Section 3(a)(2) of the Worker Adjustment and Re19 training Notification Act (29 U.S.C. 2102(a)(2)) is 

20 amended by inserting ‘‘Federal, State, and’’ after ‘‘the 

21 unit of’’. 
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1 SEC. 6. SUBMISSION OF H–1B LABOR CONDITION APPLICA2 TION AT SAME TIME AS CLASSIFICATION PE3 TITION. 

4 Section 212(n)(1) of the Immigration and Nationality 

5 Act (8 U.S.C. 1182(n)(1)) is amended by adding at the 

6 end the following: ‘‘The application under this paragraph 

7 shall be submitted by an employer at the same time as 

8 the classification petition is filed under section 214 relat9 ing to the H–1B nonimmigrants who are the subject of 

10 the application.’’. 

11 SEC. 7. EXCLUSION FROM INCOME OF SEVERANCE PAY12 MENT AMOUNTS. 

13 (a) IN GENERAL.—Part III of subchapter B of chap14 ter 1 of the Internal Revenue Code of 1986 (relating to 

15 items specifically excluded from gross income) is amended 

16 by inserting after section 139 the following new section: 

17 ‘‘SEC. 139A. SEVERANCE PAYMENTS. 

18 ‘‘(a) IN GENERAL.—In the case of an individual, 

19 gross income shall not include any qualified severance pay20 ment. 

21 ‘‘(b) LIMITATION.—The amount to which the exclu22 sion under subsection (a) applies shall not exceed $25,000 

23 with respect to each separation from employment de24 scribed in subsection (c)(1)(B). 

25 ‘‘(c) QUALIFIED SEVERANCE PAYMENT.—For pur26 poses of this section— 
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1 ‘‘(1) IN GENERAL.—The term ‘qualified sever2 ance payment’ means any payment received by an 

3 individual if— 

4 ‘‘(A) such payment was paid by such 

5 individual‘s employer on account of such indi6 vidual’s separation from employment, and 

7 ‘‘(B) such separation was in connection 

8 with a reduction in the work force of the em9 ployer. 

10 ‘‘(2) LIMITATION.—Such term shall not include 

11 any payment received by an individual if the aggre12 gate payments received with respect to the separa13 tion from employment exceed $150,000.’’. 

14 (b) CLERICAL AMENDMENT.—The table of sections 

15 for part III of subchapter B of chapter 1 of such Code 

16 is amended by inserting after the item relating to section 

17 139 the following new items: 

‘‘139A. Severance payments.’’ 

18 (c) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to taxable years beginning after 

20 December 31, 2005. 

21 SEC. 8. EXPANSION OF WORK OPPORTUNITY TAX CREDIT. 

22 (a) IN GENERAL.—Section 51(d)(1) of the Internal 

23 Revenue Code of 1986 (relating to members of targeted 

24 groups) is amended by striking ‘‘or’’ at the end of sub25 paragraph (G), by striking the period at the end of sub-
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1 paragraph (H) and inserting ‘‘, or’’, and by adding at the 

2 end the following: 

3 ‘‘(I) a qualified small business employee.’’. 

4 (b) QUALIFIED SMALL BUSINESS EMPLOYEE.—Sec5 tion 51(d) of the Internal Revenue Code of 1986 is amend6 ed by redesignating paragraphs (10) through (12) as para7 graphs (11) through (13), respectively, and by inserting 

8 after paragraph (9) the following: 

9 ‘‘(10) QUALIFIED SMALL BUSINESS EM10 PLOYEE.— 

11 ‘‘(A) IN GENERAL.—The term ‘qualified 

12 small business employee’ means any indi13 vidual— 

14 ‘‘(i) hired by a qualified small busi15 ness located in a development zone, or 

16 ‘‘(ii) hired by a qualified small busi17 ness and who is certified by the designated 

18 local agency as residing in such a develop19 ment zone. 

20 ‘‘(B) QUALIFIED SMALL BUSINESS.—The 

21 term ‘qualified small business’ has the meaning 

22 given the term ‘small employer’ by section 

23 4980D(d)(2). 

24 ‘‘(C) DEVELOPMENT ZONE.—For purposes 

25 of this section— 
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1 ‘‘(i) IN GENERAL.—The term ‘devel2 opment zone’ means any area— 

3 ‘‘(I) which is nominated under 

4 the procedures defined in sections 

5 1400E(a)(1)(A) and 1400E(a)(4) for 

6 renewal communities; 

7 ‘‘(II) which the Secretary of 

8 Housing and Urban Development des9 ignates as a development zone, after 

10 consultation with the Secretary of 

11 Commerce; 

12 ‘‘(III) which has a population of 

13 not less than 5,000 and not more 

14 than 150,000; 

15 ‘‘(IV) which has a poverty rate 

16 not less than 20 percent (within the 

17 meaning of section 1400E(c)(3)(C)); 

18 ‘‘(V) which has an average an19 nual rate of job growth of less than 2 

20 percent during any 3 years of the pre21 ceding 5-year period; and 

22 ‘‘(VI) which, during the period 

23 beginning January 1, 1990 and end24 ing with the date of the enactment of 

25 this section, has a net out-migration 
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1 of inhabitants, or other population 

2 loss, from the area of at least 2 per3 cent of the population of the area dur4 ing such period. 

5 ‘‘(ii) NUMBER OF DESIGNATIONS.— 

6 The Secretary of Housing and Urban De7 velopment may not designate more than 

8 100 development zones. 

9 ‘‘(D) SPECIAL RULES FOR DETERMINING

10 AMOUNT OF CREDIT.—For purposes of applying 

11 this subpart to wages paid or incurred to any 

12 qualified small business employee— 

13 ‘‘(i) subsection (a) shall be applied by 

14 substituting ‘20 percent of the qualified 

15 first, second, third, fourth, or fifth year 

16 wages’ for ‘40 percent of the qualified first 

17 year wages’, and 

18 ‘‘(ii) in lieu of paragraphs (2) and (3) 

19 of subsection (b), the following definitions 

20 and special rule shall apply: 

21 ‘‘(I) QUALIFIED FIRST-YEAR

22 WAGES.—The term ‘qualified first23 year wages’ means, with respect to 

24 any individual, qualified wages attrib25 utable to service rendered during the 
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1 1-year period beginning with the day 

2 the individual begins work for the em3 ployer. 

4 ‘‘(II) QUALIFIED SECOND-YEAR

5 WAGES.—The term ‘qualified second6 year wages’ means, with respect to 

7 any individual, qualified wages attrib8 utable to service rendered during the 

9 1-year period beginning on the day 

10 after the last day of the 1-year period 

11 with respect to such individual deter12 mined under subclause (I). 

13 ‘‘(III) QUALIFIED THIRD-YEAR

14 WAGES.—The term ‘qualified third15 year wages’ means, with respect to 

16 any individual, qualified wages attrib17 utable to service rendered during the 

18 1-year period beginning on the day 

19 after the last day of the 1-year period 

20 with respect to such individual deter21 mined under subclause (II). 

22 ‘‘(IV) QUALIFIED FOURTH-YEAR

23 WAGES.—The term ‘qualified fourth24 year wages’ means, with respect to 

25 any individual, qualified wages attrib-
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1 utable to service rendered during the 

2 1-year period beginning on the day 

3 after the last day of the 1-year period 

4 with respect to such individual deter5 mined under subclause (III). 

6 ‘‘(V) QUALIFIED FIFTH-YEAR

7 WAGES.—The term ‘qualified fifth8 year wages’ means, with respect to 

9 any individual, qualified wages attrib10 utable to service rendered during the 

11 1-year period beginning on the day 

12 after the last day of the 1-year period 

13 with respect to such individual deter14 mined under subclause (IV). 

15 ‘‘(VI) ONLY FIRST $15,000 OF

16 WAGES PER YEAR TAKEN INTO AC17 COUNT.—The amount of the qualified 

18 first, second, third, fourth, and fifth 

19 year wages which may be taken into 

20 account with respect to any individual 

21 shall not exceed $15,000 per year.’’. 

22 (c) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to individuals who begin work for 

24 the employer after the date of enactment of this Act. 

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