November 1996

STAWRS PROJECT UPDATE page 3

support for the STAWRS Project Although the STAWRS Harmonized Wage Code Initiative was the primary discussion point at the conference, reports were also presented on the progress made on other STAWRS initiatives. Several lunch-time demonstrations were held on various electronic oriented initiatives Monday was a half-day brainstorming session attended by approximately 16 stakeholders who have continually worked on the Harmonized Wage Code initiative. This brainstorming session discussed the Harmonized Wage Code initiative with particular emphasis on the draft Harmonized Wage Code B/ue Print. The Blue Print shows the existing degree of conformity among the varied employment-related laws which exist within the United States. This is the first time an analysis of this kind has been performed. The Harmonized Wage Code brainstorming session and ensuing discussions were jointly conducted by Phil Corn, Ron Moore, and Dan Bryant. A brief synopsis of the Single Point (Paper) Initiative being conducted jointly with the State of Oregon was given by Donna Hockensmith. Rich Colombo introduced the demonstrations on the electronic filing of Forms 941 and W-2. ***** STAWRS Bows to Hurricane Fran STAWRS was invited to be an exhibitor at the annual conference of the Interstate Conference of Employment Security Agencies (ICESA) which was held in Charleston, South Carolina, September 3 through 6, 1996. STAWRS presented exhibits of the prototypes involving Electronic Data Interchange (EDI) fling of quarterly federal and state employment tax returns as well as the annual filing of Forms W-2, Wage and Tax Statements. Individual demonstrations of these prototypes were made to many interested conference

participants. Other STAWRS initiatives such as Single-Point Filing of Paper employment-related returns were also discussed. Unfortunately, with Hurricane Fran heading directly to the Charleston area, both, the conference participants and the STAWRS staff were understandably distracted. The conference ended prematurely and we all headed home only to feel the effects of Hurricane Fran in the Washington, DC area. Although we are convinced of the ability of the STAWRS initiatives to reduce employer burden while improving government operations, we won't "mess with Mother Nature." ***** State of Montana Enters Partnership with STAWRS After learning about STAWRS at various conferences, the State of Montana has decided to expand Montana's efforts to simplify their tax and wage reporting system by joining with STAWRS. STAWRS was invited by the Montana Department of Revenue and Montana Department of Labor and Industry to a Montana Advisory Group Meeting held in Helena, Montana on October 3, 1996, to learn about Montana's wage simplification initiative. The initiative encompasses proposed 'harmonization" of Montana's employment tax statutes as well as consolidation of State employment tax related processing. The meeting was hosted by Laurie Ekanger, Commissioner of Labor, Department of Labor and Industry, and Mick Robinson, Director, Department of Revenue. Additional Montana agency representation included: Denny Zeiler, Administrator, Unemployment Insurance, Department of Labor and Industry, Jeff Miller, Administrator, Income and

Miscellaneous Tax Division, Department of Revenue; and Design Team Members Sandy Bay; Lynnette Stern; Neil Peterson; and, Char Maharg. Advisory Group members attending this session from Montana's Legislature were: Senator Sue Bartlett; Senator Gerry Devlin; Senator Mike Foster; and, Representative Chase Hibbard. Non-government Advisory Group members in attendance were: David Owen, Montana Chamber of Commerce; John Bloomquist, Montana Stockgrowers Association (representing Executive Director Jim Peterson), George Paul, Executive Director, Montana Farmers Union; and, Jake Cummings, Executive Director, Montana Farm Bureau. A presentation was made at this meeting by STAWRS to acquaint the attendees on STAWRS mission, goals, and initiatives currently in process. Subsequent to the Advisory Group Meeting, STAWR5 met separately with agency representatives to discuss STAWRS interest in the direction Montana is taking to simplify their wage filing procedures and harmonize their wage statutes, and to invite Montana to become a partner with STAWRS. Montana has accepted the offer to partner with us. We anticipate this partnership will augment and further both of our goals. ***** W-2 Demonstration Project Project Background; The genesis of this project (as well as for the overall STAWRS Project) stemmed from an Internal Revenue Service (IRS) Commissioner Advisory Group (CAG) meeting in 1990, where it was suggested that the government could reduce employer reporting burden by allowing them to file a single annual wage/tax report to a single central agency. That agency would process the data and forward it to the states and other agencies