Economic stimulus bill small boon for security
WASHINGTON-A $42 billion federal bill meant to spur commercial spending on security and other business equipment was signed into law in early March, the remains of a well-publicized and hotly debated federal economic stimulus package that was introduced by President George W. Bush shortly after Sept. 11.
The new law, called the Job Creation and Worker Assistance Act of 2002, creates a bonus first year of depreciation of 30 percent over the next three years for capital equipment purchased between Sept. 10, 2001 and Sept. 11, 2004. In other words, businesses can expense 30 percent of the total purchase price of security systems and other equipment, such as software or computers, said Neil Ivy, director of industry groups and government affairs for the Security Industry Association. Both SIA and the Central Station Alarm Association lobbied for inclusion of security equipment in the bill.
"This legislation with its incentives for investment is exactly what we need to encourage technology, productivity improvement and stronger economic growth," Richard Chace, SIA's executive director, said in a statement.
Although the purchase of security equipment is included as a capital expense in this stimulus package, the intent of the bill was to blanket all industries and not to target security individually. Another bill, the Security Equipment Expensing Act, which was introduced by Rep. Jerry Weller, R-Ill. last fall, will likely be reintroduced by Weller sometime in the 2002 legislative session, Ivy said.
"The (stimulus package) could be piece one of the incentive, but 2970 is piece two and offers even greater incentives when coupled with the bonus depreciation," Ivy said.
The security expensing act changes the Internal Revenue Code to allow business to deduct a lump sum of up to $24,000 of security equipment. That amount is scheduled to increase incrementally over time.
SIA had conservatively estimated the passage of H.R. 2970 would likely double the amount of business seen in the commercial security sector; coupled with the 30 percent bonus depreciation, the growth could exceed those projections, Ivy said.