The Work Opportunity Tax Credit (WOTC) target group known as Disconnect Youth was created by the American Recovery and Reinvestment Tax Act of 2009. (See “New WOTC Tax Credit Opportunities Arise from Stimulus Bill”)
For purposes of WOTC eligibility, a disconnected youth is someone who at the time of hire: (1) is between the ages of 16 and 24 inclusive, (2) is not regularly attending any secondary, technical, or post-secondary school during the 6-month period prior to hire, (3) is not regularly employed during the same 6-month period, and (4) is not readily employable by reason of lacking a sufficient number of basic skills.
While very successful as part of the work opportunity program, it was also very short lived. An expiration date of December 31, 2010 was built in from its beginning. Since that time, however, many of us have held out hope that the Disconnect Youth target group would be renewed. The WOTC Coalition, among others, has been pressing for its renewal.
Early this morning, I received the following correspondence from Paul Suplizio, President of the WOTC Coalition. In it, Paul addresses current efforts to restore the Disconnected Youth target group. It is published here with permission.
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From: “Paul Suplizio”
Date: Wed, February 06, 2013 1:13 am
Subject: WOTC Disconnected Youth Target Group
February 6, 2013
Since expiration of the disconnected youth target group in 2010, our Coalition has been pressing for its restoration. “Disconnected youth,” broadly defined as youth ages 16 through 24 who are out of school and out of work, are approaching 7 million in number today. In the brief 18 months of 2009-2010 when they were a WOTC target group, 362,561 disconnected youth found jobs, and we were easily on the way to a half million a year when their target group was terminated.
Our Coalition’s efforts helped bring about appointment of an inter-agency task force, headed by OMB, in 2011, and a “request for information” was sent to around 800 government agencies and NGO’s, culminating in a webinar conference in June of last year that, regrettably, hasn’t produced much so far. Our dialogue with OMB staff has continued since that time, with the goal of getting the President to address the serious disconnected youth problem in the Fiscal Year 2014 budget, and propose WOTC as the solution.
We are enclosing a copy of our latest message to OMB, sent on January 31st.
We haven’t received a reply to this message and don’t expect one till after release of the President’s budget.
Regardless of the budget, we will go all out way for restoration of disconnected youth this year. If there’s a sequester deal between now and March 1st, we will have a chance to get in the deal. Please bring this up with your White House contacts and ask them to support it—no need to ask them to extend WOTC, just present disconnected youth as major labor force problem that needs to be addressed, that restoring it in the jobs tax credit which proved very effective in 2009-2010 makes sense and should be included in the President’s proposals.
You should also bring it to attention of Majority Leader Harry Reid, Senate Finance Committee Chairman Max Baucus, and ask other Finance Committee senators to urge Senator Baucus to get it in the Democrats’ revenue proposals for a sequester deal. Senator Reid wants revenue in any sequester bill, so if the political stars align, there may be a tax title which can carry both disconnected youth and Hurricane Sandy WOTC to passage.
If sequester doesn’t work, we’ll try again on the next tax vehicle to come along.
We will keep you informed.
PAUL E. SUPLIZIO
President, WOTC Coalition
Coalition Strategy for Renewal of Expired Disconnected Youth Target Group
