Congress Takes on a Whole New Agenda in Wake of Attacks

 
 
By John Moore  |  Posted 2001-10-22
 
 
 

The war against terrorism and the shaky economy have given Congress a whole new agenda.

From the information technology perspective, issues that were at the top of the list earlier this year have been set aside or recast in a different light. Take online privacy. Early this year, privacy ranked among the leading IT initiatives. But what had been a discussion focused on consumer protection against misuse of personal data will likely transform into a debate on expanded law enforcement capabilities versus individual rights, observers say.

One thing that is top of mind: an economic stimulus package that could total $75 billion. President Bush and the Congressional leadership have been working on a plan to help displaced workers and boost the economy. Aid to those who have lost jobs—due to the economic downturn or directly as a result of the attacks—could take such forms as an extension of unemployment benefits.

As for the economic stimuli, options on the table include personal income tax cuts. For businesses, accelerated depreciation and greater deductability of expenses could emerge in the legislative package. Those are measures that such IT organizations as the Computing Technology Association of America (CompTIA) have been endorsing for some time.

Earlier this year, CompTIA, 3Com, Gateway, and Intel founded the Alliance for Small Business Investment in Technology. The alliance has been pursuing a bill to boost the amount of equipment purchases that small businesses can expense annually to $50,000, from the $24,000 currently allowed under Section 179 of the tax code. The bill, the Small Business Works Act of 2001 (S. 189/H.R. 1037), also would allow software to be expensed and let small businesses depreciate computer equipment over two years, as opposed to five years.

The alliance would like to see the investment incentives in the economic stimulus package in addition to any tax cuts, says Bruce Hahn, director of public policy at CompTIA (www.comptia.org).

An extension of the current moratorium on new Internet taxes is another feature that could end up in the economic revival bill, Hill sources said. The current moratorium, put in place in 1998, will expire in October.

While federal priorities shift, the governments e-rate initiative for schools and libraries continues apace. The program, which offers $2 billion in telecommunications discounts annually, is in its fourth funding year. On Nov. 1, schools may start applying for year-five funding (the e-rate funding year runs from July to September of the following year). A number of integrators and resellers have been involved with projects funded through e-rate.

E-rate was originally envisioned as a 5-year program, but bills before Congress may extend the e-rate discount, according to Ronald Sheps, education market manager at Westcon Group (www.westcon.com). Legislation to continue funding in years six, seven, and eight underscores "the idea that this is a program thats going to go on," according to Sheps.

E-rate offers discounts of up to 90 percent on dial-up and direct Internet access, as well as wiring, routers, switches, hubs, network servers and other gear.

Sheps sees other e-rate trends in addition to the prospect of continued funding. For one, he detects a shift to wireless technology in e-rate discount requests.

Sheps also describes a "phenomenal increase in demand," noting that funding requests from schools were three times higher than the programs 2001-2002 ceiling. "The program has certainly caught on," he says.

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