January 29, 2003


The Honorable Olympia J. Snowe
Chair, Committee on Small Business and Entrepreneurship
United States Senate
Washington, DC  20510

Dear Madame Chair:

My congratulations to you for your leadership and determination in
offering S. 158, the Small Business Expensing Improvement Act of
2003.  Your effort to expand the provisions of section 179 of the
Internal Revenue Code has the strong support of the small business
community.  S. 158 would increase the amount of qualifying property
that a taxpayer can elect to expense during the tax year from
$25,000 to $75,000 and would be very beneficial to small
businesses. In addition, the threshold limit for phasing out the
election is raised to $325,000 thereby making the benefits of the
provision available to a larger group of small businesses.

Your bill specifically helps small business by dramatically
reducing the paperwork required to account for the capitalization
of the purchased property.  It also improves businesses' ability to
retain and accumulate capital for growth.   A number of the small
business groups with whom we work strongly support the bill,
particularly the delegates to the White House Conference on Small
Business.  Increased expensing was one of the top recommendations
made by the 2,000 delegates to the Conference representing the
25,000 owners who participated nationwide.

The President has made jobs the centerpiece for his economic plan.
Advocacy studies have shown that it is the small business community
that leads the Nation out of recessions and creates 67 percent of
net new jobs.(1)  S. 158 can help small businesses which, in turn,
can help spur the economy by stimulating purchases and increasing
productivity.

We look forward to continuing to work with you and other Senators
to ensure that this bill and additional measures that benefit small
businesses move to the Senate floor for consideration and passage.
Whether the bill comes forward for consideration on its own or as
part of a package the President supports, we think it gives small
businesses the kind of simple, straight-forward assistance that
would help them take the initiative to invest in their future.

Thank you for your efforts on behalf of small businesses.  Please
feel free to call on me if I can be of assistance to you or the
Committee.

Sincerely,

Thomas M. Sullivan
Chief Counsel for Advocacy

ENDNOTE

1.  Office of Advocacy, U.S. Small Business Administration, from
data provided by the U.S. Bureau of Census.  The figure is based on
net new jobs for businesses with fewer than 500 employees from 1990
to 1995.