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IT Florida News & Views

A Message From The Executive Director

ITFlorida's signature event, the annual Awards Gala and Tech Forum, is now only a few weeks away and the deadline to receive your discount for advance registration is fast approaching (see A Call To Action below). The Awards Gala and Tech Forum, August 12-13 in Lake Buena Vista, is a must-attend for technology professionals in Florida, and will cover tech trends and opportunities throughout the state. This year we are pleased to feature NASA's David Lavery as our keynote speaker. David will detail the space agency's exploration programs and the role Florida could play in some of these exciting initiatives. I hope to see you there.

Speaking of "seeing you there," it was great to see so many folks from our IT community attend the Substitute Communications Systems Tax workshop in Tallahassee a couple weeks ago. The workshop, coordinated by the state Department of Revenue, was the first in a series designed to help the DOR understand this issue and gather feedback from the folks who may be most negatively affected by this controversial tax. ITFlorida's Chris Hart has been closely following this issue and was featured as a key thought leader in a number of recent articles on the tax. Chris and the rest of our ITFlorida team will continue to work to educate the public and legislators on this disaster-in-waiting tax.

Laurie LoRe
Executive Director
ITFlorida

A Call to Action

Register Now For 2nd Annual Awards Gala And Tech Forum

Time is running out to register for ITFlorida's annual Awards Gala and Tech Forum, scheduled for August 12-13. Register before July 29 to receive a discount. The event is being held at the Walt Disney World Contemporary Resort in Lake Buena Vista and will provide a comprehensive update on technology trends and opportunities in Florida. The keynote will be provided by David Lavery, program executive for Solar System Exploration at NASA Headquarters and head of the recent Mars Exploration Rover missions. Lavery will not only discuss some of the recent exciting missions NASA has been involved with, but also some high-profile initiatives down the road that pose wonderful opportunities for the technology and business communities in Florida.

The Forum will also be a good chance to hear the latest on the Substitute Communications Systems Tax. Additional sessions will provide valuable guidance to successfully working with homeland security contract bidding processes, the new state term contract system, and the political process that is intrinsic in so many of our business dealings.

The awards gala is also a 'can't miss' social event in which we get to relax, have some fun and honor some of our colleagues for activities they have undertaken over the past year to advance information technology in Florida

We strongly encourage tech and business professionals who do business in the state to register to attend as soon as possible.

Key Happenings Around the State

DOR Holds First Public Workshop on Controversial Communications Tax

More than 200 technology and business leaders attended the Department of Revenue's workshop on the Substitute Communications Systems Tax last month in Tallahassee. The DOR is expected to host several more workshops throughout the state in order to gain better insight in how to implement this broadly written tax. For more information on the tax and future workshops, visit www.itflorida.com.

During the Tallahassee workshop, attendees were provided a questionnaire to fill out and submit back to the DOR. Through these completed questionnaires, the DOR hopes to better define what exactly constitutes a substitute communications system and how much they cost to maintain and operate. ITFlorida is encouraging the IT community to participate in this DOR effort. This is an excellent opportunity to voice your concerns on the stifling impact this tax will have on your ability to conduct business in the state.

For more information on the workshops and questionnaire, contact the DOR's Thomas Butscher, senior attorney, Technical Assistance and Dispute Resolution, at 850-922-4710 or butschet@dor.state.fl.us. Also for more information, contact: Brewser Brown, ITFlorida Consultant at SKB Consulting Group, at 850-222-7521 or brewser@brewserbrown.com.

Recent news coverage included:

(Florida) State Tax On Business Communication Networks Causing Headaches
Associated Press, 6-22-04

(Florida) State officials are grappling with how to apply a nearly 3-year-old tax on business communication systems, trying to determine what is supposed to be taxed as technology rapidly changes. Businesses, meanwhile are anxiously watching the effort by state officials to clarify its meaning, worrying they may be hit with big levies on their computer networks.

Official To List Companies That May Face Communications Tax
Tampa Tribune, 6-23-04

The state tax collector, faced with the unpopular task of implementing the nation's first communications tax on computer networks, plans to have a tentative list by this fall of systems that would be considered taxable. Business groups and others, however, are hoping state lawmakers will intervene during the 2005 legislative session and either abolish the law mandating taxes on substitute communications systems or tighten the 1985 statute's focus.

Department Of Revenue Decide How To Tax Technology
Tampa Bay TV 10, 6-22-04

The Department of Revenue is trying to determine what to tax when it comes to technology. Under state law, the Department of Revenue has to impose a so called "substitute communications system tax." However, they're still trying to figure out what a substitute communications system is. It could mean a 16-percent increase on technology for computer routing systems, two way radios and pagers. Florida Taxwatch says, thousands of businesses around the state may have to pay hundreds of dollars in additional taxes each year. Department of Revenue spokesperson Dave Brun says, they're still collecting feedback from businesses.

Florida To Tax Home Networks
Wired News, 6-24-04

Florida state officials are considering taxing home networks that have more than one computer, under a modified 1985 state law that was intended to tax the few businesses that used internal communication networks instead of the local telephone company. Officials from Florida's Department of Revenue held a meeting on Tuesday to see whether the law would apply to wired households, and exactly who would be taxed. About 200 people attended, including community and business representatives.

Telecom Tax A Minefield For Regulators
News, Tribune, Press Journal, 6-23-04

State revenue officials resumed Tuesday their efforts to implement a 2001 law requiring them to tax alternative communication services, a term that has become a technological hornet's nest. Department of Revenue officials met with more than 100 business and local government representatives to begin determining what to tax under a controversial law originally aimed at protecting traditional telecommunication companies from private business phone systems. Regulators find themselves in the middle of a battle made more difficult by the rapid advance of technology.

Details Announced for Innovation Florida 2004

Florida's top venture capitalists, private investors, and financiers will convene at this year's eighth annual Innovation Florida 2004: Early Stage Capital Conference, presented by the University of Central Florida Technology Incubator (UCFTI) and the Central Florida Innovation Corporation (CFIC). The September conference will provide high-growth technology companies with a forum to showcase their investment opportunities, while gaining insight on the latest venture capital investment trends and cutting edge technologies. Former presenters who participated in Innovation Florida 2004 have successfully raised over $132 million. For more information, visit www.cfic.org.

Advisory Board Reports

The Digital Divide Subcommittee is working closely with the statewide Digital Divide Committee to develop goals for this upcoming year. If interested in joining the subcommittee, contact Subcommittee Chair Stephanie Smith at (850) 487-2568 or stephanie.smith@myflorida.com.

Opportunities remain with the Regional Initiatives Advisory Board, which focuses on strengthening alliances with other regional technology business organizations, and the Access, Education, and Workforce Advisory Board, which focuses on education and issues such as technology-related jobs moving offshore. If interested in serving on an Advisory Board, please contact ITFlorida at 1-800-748-1120 or office@itflorida.com.

Recent Headlines

IT Vendors Push For Quick Extension Of Expiring R&D Tax Credit
InformationWeek, 6-30-04

Businesses in the United States will no longer be eligible to receive tax credits for expenses related to research and development as of midnight Wednesday, when the federal R&D tax credit is scheduled to expire. Both houses of Congress have passed legislation that would extend the tax credit until Dec. 31, 2005, but differences in each chamber's version of the bill need to be resolved before final legislation can be presented to the White House for the president's signature. IT industry lobbyists say a lengthy delay in enacting the extension could create problems for hardware and software makers.

Bush, Kerry Offer Ideas On Technology
Associated Press, 6-25-04

President Bush and Democratic rival John Kerry offered ideas Thursday to push the United States to the cutting edge on technology, with the hope of securing crucial political support in Silicon Valley and other high-tech regions.

Study: Technology, Not Outsourcing Is The Biggest Threat To Jobs
InformationWeek, 6-25-04

Technology that adds intelligence to computers poses a far more serious threat to jobs than low-wage countries, a research firm said Friday. According to Strategy Analytics, workers in customer service, help desk, directory assistance, and other support activities in businesses will be replaced by computers that have enough intelligence to handle repetitive tasks that occur during human interaction. In the new millennium, as the use of intelligent computers increase, jobs will vanish, with several million expected to disappear over the next five to seven years.

Two Reports Show IT's Strength
InformationWeek, 6-3-04

Two economic reports issued Thursday provide further evidence of the strengthening IT sector and the impact technology has on the economy. Orders for manufactured computer products in April showed a healthy gain of 11.7%, suggesting that the economic recovery in the IT sector continues. . In another report suggesting a positive impact of IT on the nation's economy, the Labor Department said non-farm productivity in the first quarter rose 3.8%. Economists credit the efficiencies that IT provides in the workplace as being partly responsible for improved productivity, the amount an employee produces each hour on the job.

SBA Drops New Small Business Rules
Federal Computer Week, 6-30-04

The Small Business Administration is withdrawing a proposed rule that would have revised the standards used to determine what businesses qualify as small. Public comments led agency officials to reconsider the changes. "All new rules have a 60 day comment period," explained Allegra McCullough, SBA's associate deputy administrator for government contracting, in a statement. "Because we knew this issue was so important to America's small business owners, we actually extended that period to 105 days. During that time, we strongly encouraged our small business customers to contact us with their thoughts on the revisions. They did just that, and what they told us was, 'Good intention, good idea, but needs a little more work.' "

South Is On The Rise
CRN, 6-28-04

CRN, 6-28-04Solution providers in the southeastern United States handed out the largest raises last year, apparently becoming early beneficiaries of the still-spotty economic recovery. In the southeastern United States, average compensation rose a strong 8.5 percent to $80,500, according to the 2004 CRN Salary Survey. This compared with an average 5.9 percent rise nationwide. While average compensation in the region still lags behind the high-paying technology centers in California, New England and the mid-Atlantic, the Southeast is catching up. This is the second year in a row that the region experienced above-average raises.

IT's Future Depends On Public-Private Intervention, Say CEOs
InformationWeek, 6-17-04

Information technology's ability to continue innovating the way people work and live requires close cooperation between technology vendors and government to promote IT education, intellectual-property protection, international trade, and cybersecurity. These were the sentiments of CEOs and senators who participated Wednesday in a Business Software Alliance roundtable. In fact, failure to address education, intellectual-property, trade, and cybersecurity issues creates impediments to critical R&D investments that enrich innovation. The most volatile are intellectual property and offshore trade.

Across The Digital Nation: Outsourcing Pool: Local Govts. Swim, States Test The Water
Washington Technology, 6-7-04

Information technology outsourcing is a tough sell in the state and local government marketplace. Public-sector organizations embrace consulting and systems integration work, often mislabeled as outsourcing, for turnkey projects, but there is usually stiff resistance to transferring management of IT operations to a third-party vendor in a multiyear contract (true outsourcing). Over the past five years, however, there has been a subtle yet significant shift toward greater acceptance of IT outsourcing.

High-End Technology Work Not Immune To Outsourcing
The New York Times, 6-16-04

In the debate over high-technology work migrating abroad, there has been widespread agreement on at least one thing: the jobs requiring higher levels of skill are the least at risk. Routine software programming and testing jobs, analysts agree, are the ones most susceptible to being grabbed by fast-growing Indian outsourcing companies. By contrast, the people who devise the early blueprints for projects - the software architects - have been regarded as far less likely to see their jobs farmed out.

IT Grads Still See Bright Future
Knight Ridder Newspapers, 6-6-04

Elliot Olds, a computer science graduate, has been on vacation, relaxing and playing hockey in the afternoons. He is not worried about finding a job. Despite all the hype about tech jobs flying overseas, soon he'll be moving to Redmond, Wash., to take a job programming Microsoft Corp.'s search engine. Microsoft was one of three interviews and two job offers Olds had upon graduating in December from the University of Minnesota. After he snared the interviews, he stopped looking. Amid the hue and cry over the loss of white-collar tech jobs, this reality endures: The market for computer science grads has been picking up over the last few months. And the long-term demand will remain, experts say.

The Sarbox Conspiracy
CIO Magazine, 6-30-04

Sarbanes-Oxley compliance efforts are eating up CIO time and budgets. Worse, CIOs are being relegated to a purely tactical role. And that may be the CFO's plan. When CIOs began installing ERP systems years ago, they unwittingly took something that used to belong to CFOs: financial controls. The things that accountants used to monitor manually became automated inside ERP systems. Today, CFOs want those controls back. If they don't get them, they believe they could go to jail. Section 404 of the Sarbanes-Oxley Act mandates that CFOs have to do more than simply pledge that the company's finances are correct; they have to vouch for the processes used to add up the numbers.

Governments Eye Slight Spending Increases
Washington Technology, 6-21-04

State and local government spending on information technology is finally starting to rebound, according to a new report. Spending will increase from $40.7 billion in 2004 to $43 billion in 2006, a modest annual growth rate of slightly more than 2 percent, according to market research firm Federal Sources Inc. This doubles the growth rate of the state and local market in 2002 and 2003, when governments spent $39.9 billion and $40.4 billion on IT.

Upcoming Events

2nd Annual ITFlorida Awards Gala
August 12-13, 2004
Disney's Contemporary Resort, Orlando
www.itflorida.com

About ITFlorida News & Views

ITFlorida News & Views is an e-newsletter published by ITFlorida. All rights reserved. For more information, visit www.itflorida.com or call 800-748-1120. To submit news for consideration for publication in ITFlorida News & Views, email to zeszutko@bellsouth.net. If you wish to stop receiving the e-newsletter, please email office@itflorida.com.

About ITFlorida

ITFlorida is an umbrella, not-for-profit, membership organization that represents Florida's diverse information technology communities on a statewide basis. ITFlorida was formed in October 2001 after the dissolution of the Information Service Development Technology Task Force (IT Task Force), which focused on developing state policies to enable Florida to compete in the information age. ITFlorida built on the momentum of the IT Task Force and fills the need for a single statewide advocacy organization to represent Florida's IT-related technology sectors. It is organized to provide its members with access to lawmakers, businesses, capital, and domestic and international technology leaders. More information is available at www.itflorida.com.

Become A Member Of ITFlorida

If you are interested in becoming a member of ITFlorida, please contact Laurie LoRe at 800-748-1120 or by email, or visit www.itflorida.com.