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Entrepreneurs Seek More High-Tech Meccas
Policymakers should focus their efforts on improving the quality of America's workforce and take proactive steps to support the growth of start-up companies, according to a new study released by the National Commission on Entrepreneurship.
Reps. Amo Houghton, R-NY, Cal Dooley and Morino Institute Chairman Mario Morino held a press conference to announce the findings in "Building Companies, Building Communities: Entrepreneurs in the New Economy". The publication tells how public policy helps or hinders the growth of fast-growth, high-risk firms and draws on information from over 250 business leaders in 17 cities across the country. Some areas covered included Northern Virginia, Seattle, New York City, Pittsburgh and Los Angeles.
"The idea was for them to talk about this report and what it means to them," said NCOE spokesman Ken Berlack. They "want to figure out ways to replicate the (tech) success of Northern Virginia elsewhere."
The reports states the most important issues for entrepreneurs include: access to quality employees and seed capital for start-ups; access to institutional support like public universities; and the relationship of government to entrepreneurs. It also cites the key regional factors the business sector deems vital to ensuring success: diversity in capital sources; an enabling government and business culture; strong local networks; a supportive infrastructure; and entrepreneur-friendly government.
A recent Forrester Research report found that 100 percent of high-tech executives interviewed say finding and retaining talent is their No. 1 problem. A 1999 Joint Venture Silicon Valley report found that Silicon Valley's job mobility rate alone is twice the national average, generating more than $3 billion to $4 billion a year in hiring and opportunity costs.
The NCOE supports these facts and found that participants in focus groups in dot-com and new economy-dominated regions "often expressed a sense of being under seige," and faced what they viewed as unreasonable pay and equity demands from employees — many of who are recent college grads expecting to make a quick million at hot new dot-com start-ups.
Cisco has even started offering their 1,300 college interns stock options which will vest over five years in an effort to entice them to return to the company after graduation. Texas Instruments, Dell and Akamai Technologies have started to do the same, after realizing fancy cars and signing bonuses just aren't enough to lure IT grads away from other businesses.
"The focus groups' comments are right on the mark," said Morino, chairman of an organization tapped with empowering people and communities to make positive changes through the use of the Internet. "They identify the toughest problems we face; finding and retaining quality workers, building a strong Internet foundation in schools, homes and offices, and finding a way to steer government more toward an activist role for entrepreneurial growth."
NCSL: Back Off The Tax Issue
The National Conference of State Legislatures sent a letter to the Senate last week asking Congress to refrain from taking any action on the Internet tax issue this session, since the current three-year Net tax moratorium does not expire for 15 months.
"Hasty or premature action by Congress could actually delay efforts by state and local governments to streamline and simplify their own sales and use tax collection systems," the letter read.
NCSL maintains that as of now, 23 states formally have joined the Streamlined Sales Tax Project either through legislative enactment or by executive order of the governor. They are: Florida, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, North Carolina, Ohio, Oklahoma, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, West Virginia, Wisconsin and Wyoming.
Whether or not to continue the moratorium has been a hot topic in Congress this session, but Senate Commerce Committee Chairman John McCain, R-AZ, has not been able to rally enough votes to get his tax bill out of committee. What is worrying state officials is that any federal law regarding e-commerce taxes might step on their toes in establishing state laws.
"We're asking Congress not to do anything this year," said Neal Osten, director of NCSL's Commerce and Communications Committee. "No one has offered one valid reason for extending a moratorium."
In related Internet tax news, the National League of Cities board of directors last week called on Congress to pass legislation allowing state and local governments to collect sales and use taxes from online transactions. The board, however, urged Congress to respect differences among state and local tax systems by not prescribing one uniform, across-the-board tax collection system for remote transactions.
Minnesotans Protect Privacy Of Driver Info
The Minnesota Department of Public Safety, Division of Driver and Vehicle Services is now offering Minnesotans a way to keep their personal information more private.
A system that began Tuesday makes all personal data on motor vehicle and driver's license records automatically restricted from any use except those authorized by federal law. So citizens have to take action to "opt in" to have their information disseminated, versus the former system of having to "opt out" of the state's routine of passing personal data on to all information seekers. Minnesota's practice of selling driver's license information to advertising companies brings in about $2.4 million to $2.7 million per year, according to DPS administrator Vicki Albu.
The federal Drivers Privacy Protection Act of 1999 required all states to comply with an "opt-in" system and were given a June 1, 2000 compliance deadline. Albu said Minnesota waited to see if the state legislature enacted a varying law, but it did not, so DPS went through with the federal regulations.
"I know everybody's trying to do different things to comply with it," Albu said.
The compliance date comes at a time when Congress is wrangling over how to address the issue of online consumer privacy. The Federal Trade Commission last week sent a letter to Congress, specifying that online advertisers need to receive "opt-in" consent from consumers before merging tracking information with personal data.
Under federal law, insurance companies, private investigators and the like are considered "permissable users" and may obtain a driver's information whether they check opt-in or opt-out. Albu said the state is in the process of signing up 600 to 700 account holders who have sigend contracts to be bidders.
"An individual can't just go online and get the information that way," she said.
Albu said the state is assuming the number of people voluntarily willing to have their information sold will drop dramatically with the new system and that direct marketing associations are concerned about the decreasing consumer pool.
And state residents will now be able to take part in the system from their own homes. Although Minnesotans can currently view information on licenses, registrations and the like on the DPS Web site, the opt-in system is not yet online.
"It's something we're trying to get up quickly," Albu said.
Maryland Businesses To Get "eConnected"
Businesses from across Western Maryland will send representatives to Hagerstown August 10 to attend Maryland's first-ever "eCommerce Connection" at Hagerstown Community College to unveil the Department of General Services' new Internet-based procurement program, eMaryland Marketplace.
The eMaryland system is designed to streamline the state's method of purchasing goods and services and uses the Internet to connect buyers and sellers. State buyers will log on to the marketplace to place orders against state contracts or to solicit bids for goods and services. Vendors with state contracts can leverage eMaryland Marketplace to reach a broader customer base that includes not only state agencies but universities, counties, cities and municipalities that are approved to buy goods and service from state contracts.
DGS spokesman Dave Humphrey said the new system will replace the old economy system where procurement bidding takes place on paper and vendors travel to get business.
"That's pretty much paper that drives that (system); it requires vendors to drive from agency to agency, looking for opportunities," he said. "It's a standing-in-line system."
eMaryland Marketplace has been in pilot programs during the past year after Gov. Parris Glendening, D, instructed state agencies to post their services online. During this year's general assembly session, lawmakers passed legislation addressing Glendening's request; requiring that 50 percent be completed by 2002, 65 percent by 2003 aand 80 percent by 2004.
"This Web-enabling technology will present a savings to both the vendor business, as well as the state of Maryland," Humphrey said. "It's the governor's vision to make Maryland the No. 1 e-commerce and digital state in the nation. This is just one of the ways we can do that."
DGS is planning similar meetings with businesses in areas such as the Eastern Shore in September and in Prince George's County and Baltimore.
NGA Supports Wireless Act
The National Governors' Association thanked President Clinton Monday for signing legislation to simplify the way wireless telephone calls are taxed. H.R. 4391, the Mobile Telecommunications Sourcing Act, was passed by the House July 11 and the Senate July 14. Clinton signed the measure Friday.
"Getting wireless tax legislation passed and signed into law was one of our highest priorities because of the benefits it will bring to consumers, the telecommunications industry and state and local governments," said NGA Chairman Maryland Gov. Parris Glendening, D, in a statement. "We can now move forward with plans to update an old and cumbersome system that is not particularly effective in the digital age we now live in."
NGA maintains that H.R. 4391 establishes a simpler method of assigning a wireless call by establishing a customer's 'place of primary use,' provides consumers with easier-to-read bills, preserves state and local authority to tax wireless service; and simplifies and reduces costs of tax administration for carriers and state and local. This method gained favor over applying state and local taxes in each jurisdiction a caller travels in.
- by Liza Porteus
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