November/December 2011

Iwww.acec.orgnc. engineering Award- Winning Business Magazine l Published By Americ an Council of Engineering Companies >>The Changing Role of The CFO >> Unusual Engineering Innovations >> House, Senate Pass 3 Percent Repeal Senator Scott Brown Leads the Charge Against 3 Percent Withholding Engineering innovative solutions since 1983.

EXPERIENCE ACEC BIT TRUSTEES all experienced engineers— helped design insurance options COUNTS specifically for ACEC Members.

DOES yOUR INSURANCE PROvIDER hAvE whAT IT TAkES?

OUtstAndInG servICe In the complex field of engineering, experience is critical— Our commitment and insurance is no different. That’s why the ACEC Business Insurance Trust (BIT) team, partnered with Marsh, used our 28 years of experience to to quality and service create insurance programs tailored specifically to the needs of engineers. shows in our 92% The ACEC BIT team—all fellow engineers—worked with the insurance client retention rate. experts at Marsh to develop an innovative package of insurance policies When firms join our offered to ACEC Member Firms.

program, they stay! Our unparalleled experience in engineering and insurance means you get the coverage that’s right for your firm—not someone else’s. As an ACEC Member Firm, you qualify for these coverages:

• Workers’ Compensation • Professional Liability • Commercial Auto • Management Liability • Umbrella Liability • Personal Auto and Home • Business Owners Package

PUT OUR EXPERIENCE Call the Marsh insurance experts: TO wORk fOR yOU. Make sure you have the right 800.338.1391 coverage—at the right price. Get a free quote today! or visit www.acecbit.com Count on the experienced MARSh INSURANCE TEAM

AR Ins. Lic. #245544 CA Ins. Lic. #0633005 The ACEC Business Insurance Trust (BIT) has authorized Marsh USA, Inc. to make engineer’s professional liability insurance available to member firms. Neither ACEC nor The BIT endorses any one professional liability provider. It is the objective of Marsh USA, Inc. to offer a choice of providers of PLI coverage. The selection of underwriters may change from time to time.

Brokered and/or administered by Marsh USA, Inc., d/b/a The ACEC Business Insurance Trust (BIT) and Marsh USA, Inc. receive compensation from The Hartford for their endorsement and promotion of the commercial insurance products and in CA Seabury & Smith Insurance Program Management. services of The Hartford. ACEC BIT Trustees are not licensed insurance producers or agents. All Hartford insurance products and services are sold through licensed Marsh sales professionals.

51146 All Plans.indd 1 3/1/11 1:59:03 PM Project #51146, All Plans Ad Trim size: 8.375”x10.875” Bleed: 8.75”x11.25” Colors 4C=(4 color process) MARSH engineering Inc. NOVEMBER / DECEMBER 2011 ● Vol. 22, No. 6

12 16 Features Industry Leaders Weigh In 12 Highlights from the 2011 Fall Conference.

Financial Vision 16 y Member Firm CFOs discuss their roles and increasing gl e

s K e influence amid a changed economy. 8 me Ja Cover Feature Uncommon Innovation 20 Exclusive: Resolute on Repeal 8 A look at a few of the industry’s most unique and Senator Scott Brown (R-Mass.) leads a successful bipartisan unusual projects. effort to repeal the flawed 3 percent withholding mandate. Departments From ACEC to You 2 Legislative Action 6 Retirement Trust 28 Council defends level playing field in ACEC “instrumental” in achieving House Column rapidly evolving regulatory arena. and Senate 3 percent repeal; Council advances Navigating the Dodd-Frank Act and commissioning as an engineering service. performance-based compensation. News and Notes 4 New college curriculum seeks to enhance Young Professionals 24 Members in the News 29 social skills among engineering students; of the Year Dominick M. Servedio named ACEC/New York survey confirms growing ACEC honors five up-and-coming executive chairman of STV Group, trend, unfavorable impression of acquisitions; engineers for contributions to the Inc.; ACEC/Tennessee’s Candy Toler ACEC urges Kansas to stay clear of industry. named Tennessee Association Executive Professional Services Tax. of the Year. Business Insights 26 Market Watch 5 Prepare for tougher government Mergers and 32 U.S., global water needs are clear, acquisition and compliance rules; Acquisitions financing remains cloudy. Member Firms share finance and IT insights; Large-scale consolidation continues Institute for Sustainable Infrastructure and despite domestic M&A slowdown. Harvard to collaborate on new rating system.

COVER PHOTO: James Kegley

Engineering Inc. promotes the advocacy and business interests of ACEC by offering news, legislative analysis and business practice information to member firms, clients, opinion leaders and policy makers.

The articles and editorials appearing in this magazine do not represent an official ACEC position or policy unless specifically identified as doing so. From ACEC to You engineering Inc.

THE OFFICIAL PUBLICATION OF THE AMERICAN COUNCIL OF ENGINEERING COMPANIES Council Defends Level Playing Field AMERICAN COUNCIL OF ENGINEERING COMPANIES CHAIRMAN Terry Neimeyer In Rapidly Evolving Regulatory Arena PRESIDENT & CEO David A. Raymond VICE PRESIDENT, Mary Ann Emely n a recent letter to the White House, ACEC and other key industry groups OPERATIONS called for federal agencies to stop skirting the required notice-and-comment VICE PRESIDENT, Steven Hall process when issuing new regulations. GOVERNMENT AFFAIRS I VICE PRESIDENT, Jeffrey L. Beard The letter was in response to the increased use of “interim rules” under which INSTITUTE FOR BUSINESS agencies implement new regulations without due comment. ACEC believes the MANAGEMENT comment process is critical to federal rulemaking, as it provides private industry DIRECTOR, Communications Alan D. Crockett and MEDIA the opportunity to amend and improve regulations prior to their implementation. STAFF EDITOR Andrea Keeney Over the past several years, there has been a vast expansion in the number and [email protected] scope of proposed federal regulations and tax initiatives that impose burden- 202-682-4347 some costs on private businesses. The Council has been busy defeating such ill- Senior communications Gerry Donohue WRITER conceived efforts as the proposed S-corp tax increase and the IRS 1099 mandate (which would have been applied to purchases of goods and services over $600). ACEC PUBLIC RELATIONS AND EDITORIAL ADVISORY committee The Council is now targeting the SEC’s proposed interpretation of the engi- neering exemption to the municipal advisor registration requirement in the CHAIRMAN Jackie Fox

Dodd-Frank Wall Street Reform and Consumer Protection Act. If interpreted the TMG wrong way, many engineering firms would incur significant cost and legal burdens MANAGING EDITOR Corey Murray in registering with the SEC. Another proposed regulatory burden in our sights is ART DIRECTOR Jeff Kibler the effort by some in Congress and the Administration to substantially lower the PROJECT MANAGER Katie Mason executive compensation cap for reimbursements on government projects. Advertising Sales ACEC supports regulatory reform toward more streamlined, efficient ways Nina Goldman of implementing congressional intent, but will remain vigilant that such reform Director, Sales and M.O. Services does not add arduous requirements for Member Firms, their clients and taxpayers. ACEC 1015 15th Street, NW, 8th Floor This issue of Engineering Inc. features an interview with Massachusetts Sen. Washington, D.C. 20005-2605 Scott Brown, who championed one of the Council’s highest priority regulatory 202-682-4325 battles—repeal of the 3 percent withholding mandate. (See page 8.) Recent [email protected] House and Senate passage of repeal by huge bipartisan margins was a big victory Engineering Inc., Volume 22, Number 6 (ISSN 1539-2694), is published for ACEC. bi-monthly by the American Council of Engineering Companies (ACEC), 1015 15th Street, NW, 8th Floor, Washington, D.C. 20005-2605. Periodicals postage paid at Washington, D.C., and at additional mailing offices. Annual subscriptions are $24 for members (included in dues as a non-deductible amount); $45 for U.S. non-members; $65 for institutional subscriptions. Back issues are $15.

POSTMASTER: Send address changes to Engineering Inc., c/o ACEC, Terry Neimeyer David A. Raymond 1015 15th Street, NW, 8th Floor, Washington, D.C. 20005-2605. ACEC Chairman ACEC President & CEO © 2011 American Council of Engineering Companies. All rights reserved. This publication may be copied, downloaded from the ACEC website, stored in electronic or hard-copy format, and disseminated to third parties for educational and information purposes. ACEC expressly disclaims any liability for damages of any kind in connection with such copying, downloading, storage, and/or dissemination. By copying, downloading, storing and/or disseminating this publication, the recipient of this publication expressly agrees to defend, indemnify, and hold ACEC, its officers, directors, employees, volunteers and agents harmless from and against any and all losses, damages, claims, causes of action and liabilities, including reasonable attorneys’ fees and costs, arising out of or resulting from the recipient’s use of this publication. Notwithstanding the above, no part of this publication may be altered, resold, licensed, or used for any other commercial purposes without the prior written permission of ACEC. Recipients may opt out of receiving the electronic version of this publication from ACEC by sending an e-mail with the subject line “Unsubscribe” to ACEC at [email protected].

Engineering Inc. subscribers: If you have a mailing address correction or need to add or remove an employee from the Engineering Inc. mailing list, please contact the ACEC Membership Department at [email protected] or call 202-347-7474 and ask for Member Records.

Www.acec.org

2 ENGINEERING INC. November / December 2011 Save 10%* on all EJCDC Documents

EJCDC FA m I l IES o F C o NTRACTS Engineering and Construction Contracts

For more than 40 years, America’s top engineering EJCDC Families of Contracts: contracts have been produced by EJCDC, a n volunteer organization comprised of professionals Engineering Documents Owners as well as con- tractors presented with a standard EJCDC preprinted form from ACEC, NSPE, AGC and ASCE. are more likely to understand what is expected of them. Time-tested by public and private facilities n Construction Documents Many contractors and infrastructure owners, EJCDC contracts have said that there is a significant degree of comfort when are more detailed, leaving less opportunity for EJCDC preprinted forms are used. interpretation or dispute. n Design/Build Documents Especially helpful for In today’s fast-paced environment your firm needs the contractor who aspires to be a design/builder but is these high-quality and fully-insurable contracts on unfamiliar with procuring design services by subcontracting hand for immediate reference. with an engineering firm. For descriptions of all documents in each Family n Procurement Documents A viable alternative to and to purchase, visit www.acec.org/ejcdc accepting a standard purchase order agreement, avoiding the inadequacies of such forms and the difficulties of adapt- ing them to the owner’s needs and project requirements. Save 10% on all EJCDC sales at n Environmental Remediation Documents www.booksforengineers.com A distinct advantage of these documents is the encourage- through December 31, 2011* ment of innovation and recognition of the fact that the underpinning of the clean-up process is flexibility.

Use your smart- phone to scan the code and go directly to our EJCDC page to save on contracts. News&Notes

New College Curriculum Seeks ACEC Urges Kansas to Stay Clear To Enhance Social Of Professional Services Tax Skills Among Engineering Students

fficials at the University of Min- nesota (UM) say science and engi- Oneering students often enter the workforce devoid of important interpersonal social skills and communications training. To address this deficiency, UM College of Science and Engineering established “The Gemini Project,” a new program to promote networking, teamwork and bet- ter understanding of generational differ- ences and workplace relationships among students. Gemini Project Chairwoman Tess Surpre- nant said science and engineering students typically are very analytical thinkers dedi- cated to their studies. “At the same time, those students may not have spent as much time in general ACEC President Dave Raymond participated in the Kansas Governor’s Services Sector Economic as others learning to handle various social Summit in August at Black & Veatch headquarters in Overland Park, Kan. Raymond urged Kansas situations that we all know can also affect officials not to impose a professional services tax, saying such a measure would “damage the professional success,” she explained. “We state’s competitiveness with surrounding states.” From left: ACEC/Kansas Executive Director Scott believe the program helps the student Heidner, Raymond, Kansas Secretary of Labor Karin Brownlee, Gov. Brownback, Black & Veatch transition from academics to the business, Associate Vice President Clint Robinson and Black & Veatch Vice President for Government Affairs networking and teambuilding needs and Paul Weida. realities of the workplace.”

ACEC/New York Survey Confirms Growing Trend, Unfavorable Impression of Acquisitions

hile more than half showed that more than one- acquisitions favorably; more percent), than last year (44 of New York state third (36 percent) of respon- than half say such deals force percent). Only 7.5 percent of Wengineering firms dents work at a firm that has small and mid-size firms out respondents gave their busi- say it is likely that their firm acquired another firm over of the market; one-third say ness a rating of “not good.” will acquire another firm the past five years, and more such acquisitions increase cost Most engineers (61 per- within the next five years, less than one-half (51 percent) say competition; and 73 percent cent) also were at least “some- than one in five view such it is “likely” or “very likely” say the subsequent cost com- what optimistic” about the consolidation favorably, a that their firm will acquire petition has had a significant business outlook for 2012, an new ACEC/New York survey another firm in the next five impact on their business. increase from a similar study said. years. In rating industry condi- conducted in 2009, which The survey of 93 New York Despite this trend, the tions overall, more New indicated a positive outlook state consulting engineering survey showed that only 17 York state engineers describe among 46 percent of those firms conducted this summer percent of respondents view their business as fair (50.5 surveyed.

4 ENGINEERING INC. NOVEMBER / DECEMBER 2011 By Joe Salimando MarketWatch U.S., Global Water Needs Are Clear, Financing Remains Cloudy

n the United States and globally, deteriorating Ior non-existent water infrastructure presents a wide range of costly challenges. While meeting these chal- lenges presents opportuni- ties for engineers, adequate funding remains a formidable obstacle. According to a July 2011 American City & County report, the country’s aging infrastructure is in crisis. “Without renewal or replace- ment, the number of water / L J M Photo pipes in the United States s that are classified as poor, s ign Pic very poor, or life-elapsed will D e increase from 15 percent in Such issues have spurred the next 20 years for water • The EPA last year updated 2000 to 44 percent by 2020,” significant international infrastructure replacement and a 2004 Clean Watershed the report said. investment. Consider these development. Needs Survey, which con- Globally, population examples: sidered only wastewater increases and outdated water • With “water resource man- Worldwide Water: pollution control needs. The management practices are agement” dubbed priority Supply and Demand updated number (as of Janu- expected to exacerbate already No. 1, the Chinese govern- ary 2008), which includes Water Resources perilous situations. According ment has vowed to complete projected investments in to the World Bank, 80 coun- construction of a “flood Europe 6% wastewater treatment plants, tries now have water shortages prevention and anti-drought North America 15% pipe repairs, and new pipe that threaten health and econ- system” by 2020. Projected Asia Pacific 18% systems, was $298 billion. omies, while 40 percent of price tag: $600 billion. South Asia 4% • The U.S. Army Corps of the world’s population—more • Latin America and Carib- Engineers said that the East Asia 7% than 2 billion people—have bean leaders have acknowl- United States needs $100 no access to clean water or edged the need to invest Africa 9% billion to update the nation’s sanitation. more than $249 billion Middle East 11% levee systems and $125 bil- Dan McCarthy, president over 20 years “to close the South America 30% lion more “to replace the cur- and CEO of global water region’s water infrastructure Water Use rent navigation lock system.” consultant Black & Veatch, gap,” according to the World The need for improved Europe 10% singled out environmental Bank. water infrastructure would change as another potential • Brazil plans to invest $42 bil- North America 16% seem at odds with Washing- obstacle: “Through climate lion by 2015 in its municipal Asia Pacific 11% ton’s desire to cut government change, many communities wastewater and water treat- South Asia 24% spending. Federal contribu- where water was once abun- ment facilities to adequately East Asia 17% tions to water and wastewater dant can experience imbal- provide water supplies to its initiatives have dropped off ances in supply and demand. major cities and to treat their Africa 5% nearly 75 percent since 1980. Communities with limited waste. Middle East 11% resources continue to experi- Domestically, the Water South America 5% Joe Salimando writes on con- ence high growth and, as a Infrastructure Network (WIN) Source: The Atlas of the Real World: struction at www.electrical result, water supply issues estimates that $300 billion to Mapping the Way We Live, Thames contractor.com. Reach him at intensify.” $500 billion is needed over & Hudson, 2008 [email protected].

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 5 Legislative Action

Transportation Bill Advances Transportation In Senate, House Programs Extended

he Environment and Public Into 2012 Works Committee unanimously ollowing extensive advocacy and grassroots Tapproved a two-year transporta- outreach from ACEC and industry stakehold- tion bill Nov. 9 that maintains current Fers, the House and Senate approved legisla- funding levels plus inflation, a total of tion (H.R. 2887) to extend federal aviation programs $85.3 billion for highway programs. through Jan. 31, 2012, and surface transportation pro- Entitled “Moving Ahead for Progress grams through March 31, 2012. in the 21st Century” (MAP-21), the In a major victory for the industry, the bill maintains bipartisan bill consolidates the number funding at current levels; it also provides for collection of federal programs from 90 to less than of user fees for the Aviation Trust Fund and Highway Trust Fund through those dates. sma n 30, refocuses funding on key national priorities, tasks the Department of Trans- With a program shutdown averted, attention has y La nd ar G portation with developing new turned back to multiyear reauthorization bills. Key House Transportation and performance-based standards for states lawmakers hoped to negotiate a final deal on the long- Infrastructure Committee and includes several ACEC-backed proj- stalled Federal Aviation Administration bill (H.R. 685/S. Chairman John Mica (R-Fla.) ect delivery changes, including acceler- 223), including funding for airport improvement proj- ated environmental reviews and project exclusions. ects and upgrades to the nation’s air traffic control sys- MAP-21 also expands the Transportation Infrastructure Finance & tem, which has been blocked over proposed changes to Innovation Program, from $122 million to $1 billion per year, to union organizing rules at airlines. significantly increase federal credit assistance to leverage financing for major projects. Senate Majority Leader Harry Reid (D-Nev.) has indi- cated his desire to bring MAP-21 to the floor for a vote prior to the end of the year. In related news, Speaker of the House John Boehner (R-Ohio) announced plans to take up a multiyear transportation bill before the end of the year. Dubbed an “energy and infrastructure jobs bill,” the House proposal would tie additional revenue from expanded oil and gas production to transportation infrastructure investment in an effort to at least maintain current funding levels. A six-year bill funded at current levels plus inflation would total $320 billion and would require $12 billion to $15 billion annually in additional tax receipts. House Transportation and Infrastructure Com- ett y I mages /G mittee Chairman John Mica (R-Fla.) has already outlined the policy highlights of his bill, including program consolidation and aggressive project delivery reforms. u res e Li n P ict Blu ACEC Advances Commissioning as an Engineering Service he U.S. Army Corps of Engineers recently adopted capabilities of professional engineers is required. ACEC’s position that commissioning services be per- Commissioning considerations start at the beginning of a Tformed by engineering firms and selected through project to ensure that owners understand and properly verify per- Qualifications-Based Selection (QBS) in a recent Corps ID/IQ formance before project acceptance, and include not only climate solicitation. control considerations, but safety, security, sustainability, commu- ACEC has long advocated that commissioning is an engi- nications, and other equipment and systems that must be verified neering service that should be performed under the supervi- individually and collectively during operation. sion of a licensed professional engineer and selected based on ACEC continues to advance this position with federal agen- qualifications. As building systems, the breadth of technolo- cies and other associations, including working with the American gies involved and their impact on performance expand, a Society of Heating, Refrigerating and Air Conditioning Engineers broader understanding of technical principles and integrative to develop a Position Document on Commissioning.

6 ENGINEERING INC. NOVEMBER / DECEMBER 2011 ACEC ‘Instrumental’ in IssuEs on the move What’s Next Achieving House 3 Percent New highway/transit program House action before Repeal, Says Rep. Herger year-end 3% withholding repeal Bill awaits president’s he House of Represen- signature tatives has passed by a wide and bipartisan Funding for water Final appropriations by T the end of the year margin of 405-16 legislation to repeal the onerous 3 percent withholding mandate. The Sen- ACEC Successfully ate has also cleared repeal legis- Challenges Faulty Federal lation, which President Obama Procurements has pledged to sign. CEC continues to challenge procurements for engineering ACEC led the lobbying effort services that fail to follow QBS or appear to have other pro- of a broad coalition of indus- curement irregularities. After being notified by Member tries, as previously reported. A Lead House sponsor of 3 percent repeal Firms, the Council has successfully challenged low-bid procurement “I want to commend and actions by federal agencies and even local communities. thank the American Council Rep. Wally Herger (R-Calif.) (left) thanks ACEC President Dave Raymond for the Notable examples include a recent Department of Health and of Engineering Companies Human Services procurement of A/E services with cost as a selection for their hard work as leaders Council’s lobbying leadership on the bill after its passage. factor, which the agency corrected. The Council also worked with a of the coalition promoting number of Department of Defense agencies to solicit for engineering repeal,” said Rep. Wally Herger (R-Calif.), sponsor of the repeal services under the appropriate procurement category, ensuring wider legislation. “The coalition was instrumental to our success in getting participation and competition from the A/E industry. the broad, bipartisan support necessary to pass this important mea- “These actions are important steps forward and underscore the sure out of the House.” value of ACEC membership and engagement,” said Jim Blake of Johnson, Mirmiran and Thompson in Maryland. Congress Weighs In On Regulatory Burdens ouse committees recently sent to the floor several bills to control regulatory actions from the Environmental Protec- Htion Agency (EPA) that could hamper economic growth. The most significant is legislation backed by ACEC. The Transpar- ency in Regulatory Analysis of Impacts on the Nation, or TRAIN, ett y I mages /G Act (H.R. 2401) requires a Cabinet-level interagency committee to study the cumulative impacts of major EPA air pollution rules on the

Ju piter I mages nation’s economy and their impact on jobs. If enacted, the bill will delay the rules for at least six months until the study is completed. Council Asks Senate to Amendments to the bill would delay the implementation of the Substantially Increase Water utility MACT, a mercury and air toxics rule for power plants, by one Infrastructure Funding year following the study’s eventual completion and would require EPA to consider cost and feasibility considerations when setting air CEC is pressuring the Senate Appropriations Committee to quality standards under the Clean Air Act. protect water funding, urging committee members to pro- The House has also approved the Clean Water Cooperative Fed- Avide a minimum of $1.55 billion for the Clean Water State eralism Act of 2011 (H.R. 2018), which would limit several areas of Revolving Fund (CWSRF) and at least $990 million for the Drink- EPA’s ability to override or interfere with state water permit decisions ing Water State Revolving Fund (DWSRF). or Section 404 Corps permits, including approved state water quality The House Appropriations Committee has recommended severe standards, state Sec. 401 water quality certifications, state NPDES cuts to both programs, providing only $695 million for the CWSRF permits, or section 404 dredging or filling permits. and $829 billion for the DWSRF. The outlook for these bills in the Senate is uncertain, particularly “These are extremely cost-effective government programs—for in light of threatened vetoes by the White House. every dollar the federal government invests, more than $2 is matched or made available for environmental improvements,” ACEC Presi- For More News dent Dave Raymond wrote to committee members. “Additionally, For weekly legislative news, each $1 billion invested in water and wastewater infrastructure cre- visit ACEC’s Last Word online ates up to 27,000 new jobs with average annual earnings of more at www.acec.org. than $50,000, many of them in engineering firms.”

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 7 Resolute On Repeal Senator Scott Brown Leads a Successful Bipartisan Effort to Repeal the Flawed 3 Percent Withholding Mandate

n an exclusive interview with ACEC, Sen. Scott Brown (R-Mass.), a strong supporter of the engineering industry, talks about his legislation to repeal the 3 percent withholding mandate, the importance of a multiyear surface transportation program, and what he believes is needed to improve the fragile U.S. economy. Brown was elected to the U.S. Senate in January I2010 to fill the term of the late Sen. Ted Kennedy. He previously was elected three times to the Massachusetts Senate and served five years as a Massachusetts State Representative. Brown is a member of the Senate Committee on Armed Services, the Committee on Veterans’ Affairs, the Homeland Security and Governmental Affairs Committee and the Senate Committee on Small Business and Entrepreneurship. >>

8 ENGINEERING INC. NOVEMBER / DECEMBER 2011 Resolute On Repeal Senator Scott Brown Leads a Successful Bipartisan Effort to Repeal the Flawed 3 Percent Withholding Mandate James Kegley James growth and help achieve greater energy independence here at home?

BROWN: Congress must develop a clear energy policy for the coun- try that uses an “all of the above” approach, which includes renew- able technologies and nuclear power as well as more domestic resources at home to reduce our dependence on foreign oil. We should encour- age energy efficiency efforts and give consumers the choices they need in order to reduce their energy use. Most important, we cannot impose a new energy tax during this tough economy. I do not support a cap-and- trade scheme, but I am open to other options and proposals to address our nation’s energy and environmental needs.

ACEC: President Obama has pro- Sen. Brown (center) discusses 3 percent repeal strategy with ACEC President Dave Raymond posed raising individual income (left) and ACEC Chairman Terry Neimeyer outside the senator’s office. tax rates, which would impact

James Kegley James many small engineering firms and other businesses that are organized ACEC: The Council has been working BROWN: The ACEC/U.S. Chamber as S corporations or partnerships and to repeal the 3 percent withholding business coalition seeking to repeal the 3 pay business taxes at the individual rates. mandate since it was passed in 2006. percent legislation was extremely effec- What is your view of such taxes, and how With the recent passage of repeal legisl tive, and I am deeply appreciative of those can small businesses be protected? ambgious ation in the House, the focus efforts. has shifted to the Senate, where we BROWN: I do not believe now is the time greatly appreciate your strong leader- ACEC: Jobs and the economy will be the for anybody’s taxes to be raised. In fact, ship. What led you to introduce S. 164? dominant issues in the upcoming presi- I have never supported increasing taxes. dential and congressional campaigns. You’re absolutely right that allowing the SEN. SCOTT BROWN: I first became ACEC continues to advocate sustained, individual rates to go up would hurt a lot of aware of the 3 percent withholding long-term infrastructure investment— small businesses that are organized as S cor- mandate while I was visiting businesses such as passage of a multiyear surface porations and partnerships. As the growth throughout Massachusetts. A common transportation program—as critical to engines of our economy and powerful job theme I heard from businesses, both large economic growth. What would you like creators, small businesses should not be and small, was that increasing govern- to see in a bipartisan jobs package? threatened with higher taxes. ment regulations were like a wet blanket The most important signal Washington on their ability to make money, expand BROWN: Our nation’s infrastructure is can give small businesses is certainty. Pro- and eventually hire new employees. One integral to keeping our economy running. posing new taxes sends an entirely oppo- of the more egregious federal mandates I I believe it is important to set clear goals site message. Uncertainty causes small busi- heard about was the 3 percent withhold- for restoring and revitalizing our roads, nesses to put off new hiring and to restrain ing rule. Eliminating this mandate is a airports and sewer systems. We must come investment. With the federal health care common-sense, bipartisan initiative that together, not only to provide necessary bill, the EPA and other regulations coming will hopefully remove some of the doubt funding for transportation projects, but out so fast, higher future costs of operation and allow businesses to properly plan for also to ensure that our systems remain are looming over businesses large and small, future growth. competitive into the future. undermining our fragile economic recovery. I do believe our economy could use a tax ACEC: How effective was ACEC and the ACEC: Energy remains an issue with overhaul, with certain loopholes and deduc- coalition in supporting your efforts to potential for bipartisan action in Con- tions eliminated in return for lower rates pass 3 percent repeal legislation in the gress. What elements would you like to across the board. That’s the way to achieve Senate? see in a bipartisan energy package to spur strong growth. n

10 ENGINEERING INC. NOVEMBER / DECEMBER 2011 ACEC Years-Long Persistence Against 3 Percent Pays Off he Council has provided holding mandate will impose significant leadership for the coalition cash flow and administrative burdens on of business and industry tax-compliant engineering firms. organizations that oppose The U.S. Chamber of Commerce the 3 percent withholding turned to ACEC to lead a nationwide Tmandate since the law was first estab- advocacy effort for more than 100 busi- lished in 2006. ness and industry organizations commit- Intended as a tax enforcement ted to repealing the 3 percent mandate. mechanism, the 3 percent provision The result: The U.S. House of Repre- will require federal, state and local gov- sentatives passed 3 percent repeal leg- ernments that spend more than $100 islation by an overwhelming bipartisan million annually on goods and services vote of 405 to 16 at the end of October. At a U.S. Chamber of Commerce-sponsored Capitol Hill to withhold 3 percent from almost all Repeal legislation has also passed in the press conference in September, ACEC Chairman Terry contracts and payments. Senate, and the president is expected to Neimeyer said the 3 percent mandate has “an enormous ACEC quickly realized that the with- sign the bill into law. negative impact on our industry.”

Co-Sponsors of Repeal Legislation H.R. 674, S. 89 and S. 164 Alabama Florida Rep. Bobby Schilling Massachusetts New Hampshire Rep. Steve Stivers Rep. Gene Green Rep. Spencer Bachus Sen. Marco Rubio Rep. Aaron Schock Sen. Scott P. Brown Sen. Kelly Ayotte Rep. Patrick J. Tiberi Rep. Ralph Hall Rep. Jo Bonner Rep. Sandy Adams Rep. Joe Walsh Rep. Charles Bass Rep. Michael Turner Rep. Sam Johnson Rep. Martha Roby Rep. Gus Bilirakis Michigan Rep. Frank Guinta Rep. Kenny Marchant Rep. Mike Rogers Rep. Corrine Brown Indiana Rep. Justin Amash Oklahoma Rep. Michael McCaul Rep. Vern Buchanan Rep. Larry Bucshon Rep. Dan Benishek New Jersey Sen. James M. Inhofe Rep. Randy Neugebauer Alaska Rep. Kathy Castor Rep. Dan Burton Rep. Bill Huizenga Rep. Rodney Rep. Tom Cole Rep. Pete Olson Sen. Mark Begich Rep. Ander Crenshaw Rep. Joe Donnelly Rep. Dale Kildee Frelinghuysen Rep. James Lankford Rep. Ron Paul Sen. Lisa Murkowski Rep. Mario Diaz-Balart Rep. Mike Pence Rep. Thaddeus G. Rep. Scott Garrett Rep. Pete Sessions Rep. Don Young Rep. Connie Mack Rep. Todd Rokita McCotter Rep. Leonard Lance Oregon Rep. Lamar Smith Rep. John Mica Rep. Marlin A. Stutzman Rep. Candice Miller Rep. Frank A. LoBiondo Rep. Earl Blumenauer Rep. Mac Thornberry Arizona Rep. Jeff Miller Rep. Todd Young Rep. Gary Peters Rep. Bill Pascrell Rep. Kurt Schrader Rep. Jeff Flake Rep. Bill Posey Rep. Mike Rogers Rep. Jon Runyan Rep. Greg Walden Utah Rep. Trent Franks Rep. David Rivera Iowa Rep. Fred Upton Rep. David Wu Rep. Rob Bishop Rep. Paul A. Gosar Rep. Tom Rooney Rep. Leonard L. Boswell Rep. Tim Walberg New Mexico Rep. Jason Chaffetz Rep. Benjamin Quayle Rep. Ileana Rep. Bruce Braley Rep. Martin Heinrich Pennsylvania Rep. Jim Matheson Rep. David Schweikert Ros-Lehtinen Rep. Steve King Minnesota Rep. Ben Ray Lujan Rep. Jason Altmire Rep. Dennis Ross Rep. Tom Latham Sen. Al Franken Rep. Steve Pearce Rep. Lou Barletta Virginia Arkansas Rep. Cliff Stearns Rep. David Loebsack Sen. Amy Klobuchar Rep. Charles W. Dent Rep. Gerald E. “Gerry” Sen. John Boozman Rep. Daniel Webster Rep. Michele Bachmann New York Rep. Michael Fitzpatrick Connolly Sen. Mark Pryor Rep. Allen West Kansas Rep. Chip Cravaack Rep. Timothy H. Bishop Rep. Jim Gerlach Rep. J. Randy Forbes Rep. Mike Ross Sen. Jerry Moran Rep. John Kline Rep. Ann Marie Buerkle Rep. Tim Holden Rep. Robert Hurt Rep. Rick Crawford Georgia Sen. Pat Roberts Rep. Erik Paulsen Rep. Christopher P. Rep. Mike Kelly Rep. James Moran Rep. Tim Griffin Sen. Saxby Chambliss Rep. Tim Huelskamp Rep. Tim Walz Gibson Rep. Tim Murphy Rep. E. Scott Rigell Rep. Steve Womack Sen. Johnny Isakson Rep. Lynn Jenkins Rep. Michael Grimm Rep. Joseph R. Pitts Rep. Robert J. Wittman Rep. Sanford Bishop Rep. Mike Pompeo Mississippi Rep. Richard L. Hanna Rep. Todd Platts Rep. Frank Wolf California Rep. Paul C. Broun Rep. Kevin Yoder Sen. Thad Cochran Rep. Nan A.S. Rep. Bill Shuster Rep. Brian P. Bilbray Rep. Phil Gingrey Sen. Roger Wicker Hayworth Rep. Glenn Thompson Washington Rep. Ken Calvert Rep. Tom Graves Kentucky Rep. Gregg Harper Rep. Brian Higgins Rep. Doc Hastings Rep. John Campbell Rep. Henry C. “Hank” Sen. Rand Paul Rep. Alan Nunnelee Rep. Maurice Hinchey South Carolina Rep. Jaime Herrera Rep. Lois Capps Johnson, Jr. Rep. Ben Chandler Rep. Steven M. Palazzo Rep. Steve Israel Rep. Jeff Duncan Beutler Rep. Dennis A. Cardoza Rep. Jack Kingston Rep. Geoff Davis Rep. Carolyn B. Rep. Trey Gowdy Rep. Rick Larsen Rep. Jim Costa Rep. John Lewis Rep. Brett Guthrie Missouri Maloney Rep. Mick Mulvaney Rep. Cathy McMorris Rep. Anna Eshoo Rep. Tom Price Rep. Harold Rogers Sen. Roy Blunt Rep. William L. Owens Rep. Tim Scott Rodgers Rep. Bob Filner Rep. Austin Scott Rep. John A. Yarmuth Sen. Claire McCaskill Rep. Charles B. Rangel Rep. Joe Wilson Rep. Dave Reichert Rep. Elton Gallegly Rep. Lynn A. Rep. Todd Akin Rep. Tom Reed Rep. Adam Smith Rep. Wally Herger Westmoreland Louisiana Rep. Emanuel Cleaver Rep. Edolphus Towns South Dakota Rep. Duncan Hunter Rep. Rob Woodall Sen. David Vitter Rep. Jo Ann Emerson Sen. John Thune West Virginia Rep. Darrell E. Issa Rep. Rodney Alexander Rep. Sam Graves North Carolina Rep. Kristi Noem Rep. Shelley Moore Rep. Tom McClintock Hawaii Rep. Charles W. Rep. Vicky Hartzler Sen. Richard Burr Capito Rep. Howard McKeon Rep. Mazie K. Hirono Boustany, Jr. Rep. Billy Long Rep. Renee L. Ellmers Tennessee Rep. David B. McKinley Rep. Jerry McNerney Rep. Bill Cassidy Rep. Blaine Luetkemeyer Rep. Virginia Foxx Rep. Diane Black Rep. Nick J. Rahall, II Rep. Gary G. Miller Idaho Rep. John Fleming Rep. Walter B. Jones, Jr. Rep. Marsha Blackburn Rep. Devin Nunes Sen. Mike Crapo Rep. Jeffrey M. Landry Montana Rep. Sue Wilkins Myrick Rep. Scott DesJarlais Wisconsin Rep. Ed Royce Sen. Jim Risch Rep. Steve Scalise Sen. Jon Tester Rep. John J. Duncan, Jr. Rep. Tammy Baldwin Rep. Raul Labrador Rep. Denny Rehberg North Dakota Rep. David P. Roe Rep. Sean Duffy Colorado Rep. Michael K. Maine Sen. John Hoeven Rep. Ron Kind Rep. Mike Coffman Simpson Sen. Susan M. Collins Nebraska Rep. Rick Berg Texas Rep. Thomas E. Petri Rep. Cory Gardner Sen. Olympia J. Snowe Sen. Mike Johanns Sen. Kay Bailey Rep. Reid J. Ribble Rep. Doug Lamborn Illinois Rep. Michael H. Rep. Jeff Fortenberry Ohio Hutchison Rep. Paul Ryan Rep. Scott Tipton Sen. Mark Kirk Michaud Rep. Adrian Smith Sen. Rob Portman Rep. Kevin Brady Rep. F. James Rep. Judy Biggert Rep. Lee Terry Rep. Steve Austria Rep. Michael Burgess Sensenbrenner, Jr. Connecticut Rep. Robert Dold Maryland Rep. Steve Chabot Rep. Francisco “Quico” Rep. Joe Courtney Rep. Randy Hultgren Rep. Roscoe Bartlett Nevada Rep. Bob Gibbs Canseco Wyoming Rep. Rosa L. DeLauro Rep. Jesse L. Jackson, Jr. Rep. Elijah E. Sen. Dean Heller Rep. Bill Johnson Rep. John Carter Sen. John Barrasso Rep. James A. Himes Rep. Timothy Johnson Cummings Rep. Shelley Berkley Rep. Jim Jordan Rep. Michael Conaway Sen. Michael B. Enzi Rep. John B. Larson Rep. Adam Kinzinger Rep. Andy Harris Rep. Joseph J. Heck Rep. Steven C. Rep. Henry Cuellar Rep. Cynthia M. Rep. Christopher S. Rep. Daniel Lipinski Rep. C.A. Dutch LaTourette Rep. Blake Farenthold Lummis Murphy Rep. Donald A. Ruppersberger Rep. Bob Latta Rep. Bill Flores Manzullo Rep. John Sarbanes Rep. Jean Schmidt Rep. Louie Gohmert Rep. Peter J. Roskam Rep. Chris Van Hollen Rep. James B. Renacci Rep. Kay Granger

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 11 Fall Conference Delivers

NewOn Future Markets, Insights Solutions to Industry Challenges he state of the nation’s transportation and energy markets and future business opportunities for Member Firms headlined ACEC’s recent Fall Conference in Las Vegas. More than 750 members and national industry experts attended the event, which took place Oct. 19–22 at Caesars Palace. Under the theme, “The TRoad Ahead in Engineering Markets,” participants offered compelling insights and advice for addressing the industry’s most pressing challenges. Jacobs CEO Craig Martin urged attendees to prepare for a prolonged economic slowdown, noting history shows that complete recovery from a recession can take years. “The world we’re in today is the world we will face going forward,” Martin said. “And, for our industry, that means scarcity of funding is also going to continue for a long time.” “Listening to speakers discuss long-term trends on how to position one’s firm going forward was very helpful,” said Timothy Haener of J-U-B Engineers, Inc., in Boise, Idaho. “There are threats to our industry that cause real concern to the sustainability of the engineering practice.” “This was an excellent conference with sessions and speakers pertinent to the issues all of our businesses must deal with,” said Stu Monical of MKK Engineers in Greenwood Village, Colo.

Jacobs CEO Craig Martin Speaker Highlights n Jacobs CEO Craig Martin advised attendees to enhance their procurement and risk management skills because clients are becoming increasingly sophisticated. “Firms must be acutely aware of the ‘new normal’ to be well positioned for the AMEC Earth & Environmental New Insights future,” he said. On Future Markets, President Hisham Mahmoud n CDM CEO Richard Fox ACEC Chairman Terry Neimeyer, said the market must embrace Solutions to Industry Challenges CEO of KCI Technologies innovation, and engineers must contribute to increased construction productivity. “Engineers need to focus on how to build something as much as how to design it,” he told attendees.

n Hisham Mahmoud, president, AMEC Earth & Environmental, Nevada Gov. Brian Sandoval considered the challenges of globalization. “If you are a regional or local firm and don’t think you’re competing globally, think again,” he said.

n Alan “Bud” Wendorf, CEO, Sargent & Lundy, forecast dramatic growth in the natural gas sector. “One-third of natural gas currently goes to electrical production,” he said. “In 20 years, it will be closer to 50 percent.”

Sargent & Lundy CEO n Nevada Gov. Brian Alan “Bud” Wendorf Sandoval promoted his state’s infrastructure achievements as he welcomed attendees to CDM CEO Richard Fox Las Vegas.

n Former Arkansas Gov. Mike Huckabee implored Congress to substantially invest in the nation’s infrastructure, calling it a “fiscally sound and reasonable way to rebuild this g es country.”

Former Arkansas Gov. Ima oden/Getty Mike Huckabee g R Gre Awards n Jack Beemer of David Evans and Associates in Bend, Ore., received the 2011 ACEC Chairmen Emeritus Award.

n Christopher Cook, Abonmarche Consultants, Benton Harbor, Mich.; Robert Hutterman, Lu Engineers, Pittsford, N.Y.; and Smita Shah, Hofmeister Calls for ‘Independent Commission’ SPAAN Tech, Chicago, received the 2011 To Avert ‘Energy Abyss’ ACEC Community Service ohn Hofmeister, founder of Citizens for Hofmeister proposed creating an independent Award. Affordable Energy and former CEO of Shell regulatory commission for energy modeled after JOil, proposed a bold solution to the nation’s the Federal Reserve Board. The commission n Nine Member looming energy crisis. would create a 50-year plan for the nation’s Organizations “Fundamentally, our energy infrastructure is on energy future, focus on making energy consump- were recognized for its last legs,” Hofmeister said at the Conference. tion more efficient, discuss issues related to envi- surpassing their 2011 “We are on the path to an energy abyss, with gas ronmental protection and build an infrastructure ACEC/PAC fundraising lines, brownouts and blackouts.” that is robust, risk-based and intelligent. goals: Alaska, Indiana, Hofmeister attributed the crisis to the U.S. And he called on engineers to do their part. Maryland, Massachusetts, political system, which “is driven by the perversity “You and your predecessors built our incred- North Dakota, Oregon, of partisanship and political timetables.” ible 20th-century energy infrastructure,” he told South Carolina, South “Fixing our energy system will take decades,” he the audience. “Now, in the 21st century, we need Dakota and Washington. said. “It can’t be done in a two-year election cycle.” to do it all again.” Hawaii and Wisconsin were recognized at the spring ACEC/PAC Achieves Record Fundraising ACEC Annual Convention CEC/PAC raised a record $145,400 at the Fall Conference. Arnie Rusten of BergerABAM, for meeting their 2011 goals. Inc., in Federal Way, Wash., won the annual ACEC/PAC Sweepstakes $10,000 grand prize; A Blake Murillo of Psomas in Los Angeles won the $5,000 second prize; and Harlan Quenzer of n Twenty-one Schmucker, Paul, Nohr & Associates in Mitchell, S.D., took the $2,000 third prize. The five $1,000 Member prizes went to David Winter, Hart Crowser, Inc., Seattle; Tom Collins, Collins Engineers, Inc., Chi- Organizations cago; Mel Sears, Parsons Brinckerhoff, Portland, Ore.; Theresa Patten, Credere Associates LLC, Port- received awards for achieving land, Maine; and Tom Haselden, BP Barber, Columbia, S.C. their membership goals: Alaska, Arkansas, Colorado, Connecticut, Hawaii, Louisiana, Maryland, Metropolitan Washington, Minnesota, Missouri, Nebraska, New Mexico, North Carolina, Ohio, Oklahoma, Oregon, Texas, South Carolina, Vermont, West Virginia and Wisconsin.

Winners of the ACEC 2011 Young Professional of the Year Awards appear on page 24. Peter Mesha, group president of engineering at Wight & Winners of the 2011 QBS and Company, and wife, Loren, tour the Hoover Dam Bypass, ACEC Scholarships were winner of ACEC’s 2011 Grand Conceptor Award for the previously published. year’s most outstanding engineering achievement. Bart Patton, senior vice president at Kleinfelder, and wife, Joni, enjoy the Vegas panorama during a Fall Conference 2011 College reception at Caesars Palace. Of Fellows Inductees n Marc Alper Alper Audi, Inc., St. Louis n Philip Beer II USI Consultants, Inc., Indianapolis n Lisa Brothers Nitsch Engineering, Boston n Philip Budde Strand Associates, Inc., Madison, Wis. n William Brock Johnson Garver, North Little Rock, Ark. n Michael Matthews Wayne Horlacher, principal/vice president of Atkins, leads the discussion at the CIO Roundtable. Seated from left: James H&A Architects & Walsh, chief technology officer, AECOM; Steve Ross, CIO, Thornton Tomasetti, Inc.; Chris Pinckney, CIO, Psomas; and Cora Engineers, Glen Allen, Carmody, senior vice president, information technology, Jacobs Engineering. Va. n Craig Musselman CMA Engineers, Inc., Portsmouth, N.H. n June Nakamura Kennedy/Jenks Consultants, Inc., Honolulu n Jon Nishimura Fukunaga & Associates,

Inc., Honolulu n Chris Poland Degenkolb Engineers, Oakland, Calif. A standing-room-only seminar about business development metrics was one of more than 30 professional development n Ted Williams sessions presented at the Fall Conference. Landmark Engineering, Inc., Havre De Grace, ACEC Thanks the Md. 2011 Fall Conference Sponsors n Roy Yamashiro Consulting Structural Hawaii, Inc., Honolulu Key Conference Sponsors ACEC/PAC Sponsors Golf Tournament Sponsors ACEC Business Platinum C&S Companies n D. Dale York Insurance Trust Lockton Companies Gannett Fleming LBYD, Inc., Bentley Systems Degenkolb Oates Associates Birmingham, Ala. Strand Associates, Inc. n David Young Supporting Sponsors Silver CDM, Cambridge, ACEC Retirement Trust Pennoni Associates Mass. Jacobs Engineering Deltek XL Insurance

November / December 2011 ENGINEERING INC. 15 Financial By Stacy Collett

Vi sionMember Firm CFOs accept more responsibility in a changed economy

s firms work to grow their businesses amid the fits and starts of the latest economic cycle, perhaps no leadership role has undergone more change than that of chief financial officer. Once viewed as the scorekeepers of business success, today’s financial leaders play the role of both strategist and bookkeeper. CFOs must develop strategies to compensate for smaller margins and late receivables. They also must prepare their firms to react to unstable market Aconditions and develop long-term projections for the road ahead. In this special feature, several Member Firm CFOs discuss how their firms are faring in the current marketplace, what proposed Financial Accounting Standards Board (FASB) rule changes to leases and revenue recognition might mean for business, and how their respective CFO roles have evolved in a changing economy. >> Looking for a Solution

Woolpert, Inc. The administrative burden of Headquarters: Dayton, Ohio tracking those deliverables will Specialties: Design, also be a challenge. geospatial, water and Regarding proposed lease energy firm rules, “that would mainly F.Y. 2010 Revenues: impact our balance sheet,” he $118.85 million says. “We don’t own our real estate; we lease all of our build- oolpert, Inc., ings and the majority of our CFO Josh Heid equipment. My biggest concern is considering is with our third-party vendors several options and banks—adjusting loan Vi sion Wto combat the proposed FASB covenants and understanding changes to revenue recognition, the impact of these accounting Josh Heid including being more specific changes.” on deliverables when writing The Dayton, Ohio-based contracts. “It’s my understand- firm is retooling its current project in the past, that number to that of a chief operating offi- ing that if you have that in the service offerings to be more ver- has doubled,” Heid says. Still, cer. “Profit is getting squeezed, contract and can identify deliv- tically focused after two years he says, the firm has been able so there’s more focus on effi- erables throughout the contract, of relatively flat revenues. Like to maintain a strong cash posi- cient operations and reducing then you can take profits at most firms, margins have nar- tion, primarily by “not invest- overhead,” he explains. “I’m those occurrences. That’s an rowed amid increased competi- ing in growth.” definitely more involved in education for our project man- tion. “Where we would have 10 Heid says the role of today’s operational meetings with our agers and legal staff,” Heid says. to 15 competitors going after a CFO can be closely compared different business units.” Smaller Firms Feel the Pressure

territory. “We’re seeing very ously untapped lines of credit competitive price bidding to manage cash flow. for local contracts that aren’t Such measures could be constrained by the federal tested further if the new FASB qualifications-based selection regulations governing revenue rules,” he says. “Everybody is recognition take effect. “If we sharpening their pencils and have to go back and restate doing whatever they can to our financials to account lower bids.” for projects that are ongo- In that sense, even going ing rather than projects gone after new business could prove through, that’s going to be a cost-prohibitive. “You have to huge nightmare.” On the lease assess your potential for get- side, “my foreign locations are ting the work and what the certainly a concern. I’m going return is going to be,” Cham- to have to disallow interest bers explains. “Is it even worth expenses that are currently David Chambers it to get into that kind of wrapped up in those operating competition and just knowing leases,” he says. Delta Engineers, s competition for you’re spinning your wheels?” Chambers says these and Architects & Land new work heats The competition squeeze, other business changes make Surveyors, P.C. up, David Cham- coupled with a push-out in the CFO’s role increasingly Headquarters: Endwell, N.Y. bers, CFO of New receivables and lower staff complex. s Specialties: Engineering, AYork-based Delta Engineers, utilization rates, has forced “We’re beginning to experi- architectural and land Architects & Land Survey- Delta, which deals primarily ence shifts in how we’re deliv- G etty I mage surveying services ors, P.C., says a lot of mid-size in government contracts, to ering projects. Joint ventures, F.Y. 2010 Revenues: firms are suddenly moving take unprecedented financial design/build—all are new to n g/ ole Wari >> Ni c $10 million into traditionally small firm measures, such as using previ- us,” he says.

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 17 Riding Shotgun

RS&H we’ve had to walk away” rather Headquarters: Tallahassee, Fla. than doing the project at less Specialties: Facilities and than cost, Jacobson explains. infrastructure consulting The firm also spends more F.Y. 2010 Revenues: money to get jobs. “We put $144 million more effort into our presenta- tions and spend more time en Jacobson on the proposals, and that remembers when increases our costs,” he says. the CFO was With revenues down just 4 largely an executive percent in 2011 and cash bal- Krecord-keeper, whose job was ances holding steady, Jacobson to set up controls, maintain says RS&H is holding its assets and handle compliance own in the current market- Pete Dyke issues. But that has changed. place. But proposed FASB “I used to liken this firm rule changes that would affect to a car—I’m looking out the how firms report revenue for All Boats Rising back window, and the CEO is ongoing contracts and operat- ARCADIS U.S. egy development and do more looking out the front window,” ing leases could spell trouble Headquarters: Highlands sophisticated analysis intended says Jacobson, executive vice ahead. Ranch, Colo. to improve performance or president and CFO at RS&H, ACEC has submitted com- Specialties: Environmental, inform strategic decisions. a facilities and infrastructure ments to FASB expressing water, infrastructure and Dyke’s most difficult challenge consulting firm in Tallahassee, serious concerns about its pro- building firm right now is staying ahead of the Fla. “Now we’re both looking posals to decouple the report- F.Y. 2010 Revenues: curve and anticipating market out the front window.” ing of costs and revenues for $1.44 billion changes. “Finding those areas With margins tightening ongoing contracts, and to treat where you can fine-tune the across the board, Jacobson says all leases as capital leases. Both ete Dyke, CFO of business a bit to get more margin the CFO has become more proposals, currently under ARCADIS U.S., the and provide more value to the forward-looking and involved consideration by FASB, would domestic arm of a client is getting more difficult,” in every decision, from pro- have significant impacts on large international he says. posals to marketing costs. In A/E firms. Pdesign consultancy with envi- Thanks to a diverse portfolio a buyer’s market, “some fee “We can deal with the ronmental, water and infrastruc- of clients and the solid position structures are so ridiculous that lease change, but this revenue ture expertise, says business and of its parent company, the firm’s recognition rule is just a sea economic changes require his revenues, margins and liquidity change for us,” Jacobson says. financial team to take on more remain solid. “We’re on a percent-complete responsibility. “We’re getting “We’ve done a pretty good accounting method now for more involved in some multidi- job of continuing to maintain financial accounting and tax mensional, strategic elements” margins and find those improve- purposes. Our average project within the firm, he says, such ments where we can to keep the time is two and a half years. as more functional leadership firm performing where we need We’re doing larger projects than just accounting and finance it to be,” he says. “We put a lot for NASA and larger road- and leading firmwide cross- of emphasis on the technical way work and bridges. For functional initiatives. capabilities of our staff and some shorter-term projects, I think “I think CFOs are spend- unique solutions to problems the impact would be minimal. ing more time developing their our clients are facing. It comes But, if we can’t recover revenue people and expanding the capa- down to the talent you have. over two to three years, that’s bilities of their teams, and that We’re getting fair value for the going to be significant.” allows them to play a different services we provide.” In the near term, Jacobson role in the company,” says Dyke. There’s little question the role plans to keep RS&H ahead He’s constantly looking for of the CFO has changed. “You of the industry curve. “It’s a opportunities where members of can’t rely on your old bag of much tougher business now. his staff can gain experience in tricks,” says Dyke. “You need to You’ve got to change. If you these new business-centric roles. continue to look for those new Ken Jacobson don’t, you’re just not going to They work on cross-functional ways of finding value and be able be around,” he says. projects, get involved in strat- to retain that value for the firm.”

18 ENGINEERING INC. NOVEMBER / DECEMBER 2011 been stressed about it. We have business. The outside world is It’s Not Us, It’s Them always had—and still do have— what’s changed—the economy, a strong balance sheet.” government regulations, scan- Hanson Professional do for them has changed. So Keim doesn’t see her role dals such as Enron, the financial Services, Inc. there’s been a shifting to try to as CFO changing as much crisis and all these other things Headquarters: Springfield, Ill. maintain that multiplier.” as the world around her has. that have broadened the role of Specialties: Engineering, Margins have suffered more, “In many engineering firms, a the CFO. When these things architecture, planning at least at Hanson, as a result CFO has always been a strategic happen in an engineering firm, and allied services of staff changes, she says. “We business partner, because the who is going to address it? With F.Y. 2010 Revenues: have reduced our staff as a result other people in the firm are increased government regula- $62.2 million of the economy. Consequently, engineers. You were the person tions, it’s going to fall on the our utilization has suffered. We they looked to for guidance in CFO to be in compliance.” t Hanson Profes- do right-side over time, but it sional Services, takes us a while to do that,” she Inc., in Springfield, explains. Ill., margins are Though liquidity improved Asmaller, but not necessarily with initially after staff cuts and regard to their net multiplier, several old receivables came in, says CFO Jo Ellen Keim. Keim says that bump has lev- “The client is obviously much eled off. The question is where more cost sensitive. They’re to go from here. “We’re starting constantly challenging us. But to borrow again. Part of that it really hasn’t decreased that is a good thing because we’re much given the recession. In starting to grow, and part of it part, that’s because we’re not just is a bad thing because clients working with the same clients are paying slower,” she says. “So that we were three years ago,” we’re putting more emphasis on she explains. “They’ve come and collections and strategies to col- Jo Ellen Keim gone, and the type of work we lect faster, though we’ve never

if there’s any pending litigation “We now have four CPA firms A New Approach or collections against them,” because we operate in four dif- Palvisak says. ferent regions of the county. GAI Consultants, Inc. The background checks have Until they get a unified FAR Headquarters: Pittsburgh turned up a few high-risk clients audit report, which is coming, Specialties: Engineering and that warranted further discus- we’re virtually tied to each of environmental consulting sion with GAI’s president and these firms who have con- F.Y. 2010 Revenues: CEO, Gary DeJidas, but the nections to ensure timely and $85 million majority of the Pittsburgh-based accurate filings in those states. firm’s work (70 percent) comes Several states made it very dif- AI Consultants, from repeat clients. ficult to get approved rates, so Inc., is changing GAI has remained financially we went with local firms rather the way they look at profitable during the recent than risk not having a current prospective clients. downturn by steadfastly main- approved rate.” G“We’re building on our taining a diversified client base, Palvisak describes his role philosophy of working with by being diligent in AR collec- as CFO as that of an educator high-quality clients,” says Karl tions, and by making several key to the firm’s engineers. “We’re Palvisak, vice president and acquisitions. With employee trying to get each project man- CFO. “We perform informa- costs escalating and billing rates ager to think like a business- tional checks on all new clients falling, the firm has taken steps person and actively engage in just to see if there are any red to reduce overhead, such as collecting accounts receivable,” flags that we need to be con- moving to a self-insured health he says. “It’s all part of being cerned about.” The firm uses care plan. that spoke in the wheel that Dunn & Bradstreet, Google Administrative costs associ- pushes us forward.” n searches, and Uniform Com- ated with FASB rules are also mercial Code queries to collect taking their toll. “Our legal Stacy Collett is a business and Karl Palvisak information. “You can see what and accounting fees are going technology writer based outside states they do business in and through the roof,” says Palvisak. Chicago.

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 19 MULTI-PROJECT FEATURE

UncommonMember Firms collaborate on some of the industry’s most uniqueInnovation and unusual projects Combating Asian Carp Invasion

Engineers plan to equip the Coon Rapids Dam in Brooklyn Park, Minn., with a barrier that prohibits destructive Asian carp from migrating up the Mississippi River.

Project: ects. Take the 1,000-foot-long Asian carp grow huge, like Asian Carp Barrier, Coon Rapids Dam in Min- to eat, and reproduce and ruin Martin Weber Coon Rapids Dam, nesota, for example. Martin habitat for native fish. The carp Brooklyn Park, Weber, project manager and migrate during floods when explains. Earlier this year, the Minn. principal water resources engi- high waters carry them over bar- company presented its evalua- neer for Stanley Consultants, riers. They can swim up to 25 tions and recommendations to Firm: says such measures and any feet a second and jump 10 feet. the Minnesota Department of Stanley behavioral barrier would be Stanley Consultants began Natural Resources and other Consultants, Inc., difficult to build and maintain conducting studies in 2010 on stakeholders. The Minnesota Minneapolis given the dam’s high flow and the carp’s habits and behav- state legislature passed a bond cold weather climate. “The only ior and worked closely with bill over the summer that would practical solution to meeting the regional fishery experts to fund the dam renovation proj- he Asian carp is an state’s Three Rivers Park Dis- determine the best way to stop ect, but the final design package aggressive, invasive fish trict’s goal of preventing further their migration. The company and construction timeframe that, as it makes its way upstream migration of the Asian also performed hydrologic have yet to be released. up the Mississippi River, carp at the dam and protecting and hydraulic evaluations of To analyze the hydraulics of is threatening sport- the $2 billion Minnesota fish- the dam and determined that the dam and evaluate the poten- Tfishing lakes across Minnesota ing industry was to improve the altering its flow regime, along tial creation of a physical barrier, and the Great Lakes. natural barrier characteristics, with additional operational and Stanley Consultants assembled To prevent these potentially namely high-water velocity and physical changes, could create a team to detail potential solu- destructive fish from migrating, head (water drop), that Coon a barrier 99 percent effective at tions to the carp problem. a number of barriers have been Rapids Dam could potentially preventing upstream migration. “Working with experts in proposed, featuring, among provide. Modifications included “Necessary improvements to dams, gates, hydrology, and other elements, electricity, a new crest gate system and the dam would include a new river hydraulics, and with engi- acoustics, lights and air bubbles, modified operating procedure spillway gate system, a new still- neers and designers, we devel- all proven effective when used that provides the necessary ing basin and measures that will oped a presentation that could on small dam projects. water velocity and head more extend the life of the structure, be understood by both expert But many of these methods consistently throughout the such as general repairs and and nonexpert stakeholders, and might not work for larger proj- year,” he says. maintenance upgrades,” Weber the public,” Weber says.

20 ENGINEERING INC. NOVEMBER / DECEMBER 2011 MULTI-PROJECT FEATURE

UncommonMember Firms collaborate on some of the industry’s most uniqueInnovation and unusual projects Combating Asian Carp Invasion Bacteria-Eating Wastewater Plant Project: sludge-reduction process Pease was tasked with and an effluent filter building Hamby Creek before,” says Keith Garbrick, obtaining all the necessary with three disc filter banks and Wastewater senior civil engineer for Pease. permit approvals, develop- three medium-pressure ultra- Plant Upgrade, The Cannibal system destroys ing preliminary engineering violet disinfection units. Thomasville, N.C. biological solids through and construction documents, Because this marked the an interchange recycle flow implementing the Cannibal first time the Cannibal process Firm: between the aerobic activated process throughout the plan, was implemented in the state, Pease Engineering sludge process and a specially and providing construction Pease also had to demonstrate & Architecture, PC, controlled side stream bioreac- services, including commis- the system’s effectiveness and Charlotte, N.C. tor. The side stream bioreactor sioning and close-out. The benefits for state reviewers. creates non-aerobic environ- design scope also included a “A lot of meetings were held ment stresses and conditions new emergency power genera- and much effort put forth in aced with a growing aerobic bacteria to break down tion system, as well as upgrades overcoming normal reactions population and new dis- cells and increase biodegradabil- to the existing blower building, to the introduction of new charge limits, officials for ity. The aptly named technol- aeration tanks, four digest- technology,” says Garbrick. the city of Thomasville ogy creates an environment that ers, existing 55-foot clarifiers, The firm also educated the had no choice but to encourages bacteria to digest and two interchange tanks public about the project and Fupdate and expand its outdated bacteria. “The Cannibal process for the Cannibal process. The its impact on the community, wastewater treatment plant. was chosen based on its cost- approximately $27 million including Cannibal’s potential Beginning with preliminary effective ability to reduce the upgrade and expansion project long-term financial and eco- designs in 2003, Charlotte- amount of sludge created by the also included a new metering/ logical benefits. based Pease Engineering & treatment process, resulting in screening facility, a degritting Architecture determined that increased processing savings,” facility, a two-train oxidation the best option was to create Garbrick explains. ditch, secondary anoxic tanks, a biological nutrient removal facility with an average treat- The Hamby Creek Wastewater Plant ment capacity of 6 million gal- in Thomasville, N.C., has an average processing capacity of 6 million lons a day, up from 4 million gallons of biological nutrients a day. gallons a day. Though choosing a bio- logical nutrient removal system, which removes phosphorous and nitrogen from the nearby effluent streams, is required by Keith Garbrick federal and state mandate, it was Pease that recommended the implementation of the Can- nibal Solids Reduction Process, a technology that reduces the amount of solid waste produced by sludge wastewater treatment systems. “No other plant in North Carolina has used this advanced

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 21 MULTI-PROJECT FEATURE Abandoned Mine Transformed Into Federal Archive

Project: foot underground facility into Brauer, TWM project manager. Rock City document storage space for the “The laser reflects off the Business Complex– National Archives and Records rock surface to determine dis- National Archives Administration. tance and angle. A computer and Records The first Archives Annex program then creates a point Administration, project undertaken by the cloud, or 3D model of the Valmeyer, Ill. developer exceeded the project surface,” explains J.R. Landeck, budget by 10 percent due to the firm’s land survey manager. Firm: design changes and unantici- TWM configured the space Thouvenot, Wade pated amounts of stone milling. to maximize storage capacity & Moerchen, Inc., In 2009, Swansea-based Thou- for the current second annex Swansea, Ill. venot, Wade & Moerchen, Inc. and any future expansions. (TWM), was hired to survey “Our goal was to work with Craig Brauer the space for the 75,000-square- the architect to determine the s part of a deal to foot Annex II. TWM employed best location within the caves to acquire a site upon 3D laser-scanning technol- build the space, given the vari- which to relocate ogy to map and model the able slope of the mine, and also the town of Val- mine’s underground surfaces to determine how to minimize meyer in the wake to prevent problems similar milling costs and provide a level Aof a catastrophic 1993 flood, to those encountered during floor,” adds Brauer. The com- the city purchased a nearby, the design of the first Annex. pany also designed the exten- defunct limestone mine. The “The information enabled sion of the electrical, sewer, and mine remained unused until developers to demonstrate the life safety utilities into the facil- an Illinois developer made cost-effectiveness­ of using the ity, ingress and egress points, plans to turn the naturally abandoned mine as additional and provided construction cool, dark, 6 million-square- storage space,” says Craig oversight and survey staking services. J.R. Landeck The massive number of data points that had to be collected to obtain the model of the sur- face area was the biggest chal- lenge of the laser-enabled sur- vey, according to Landeck. The scanner picked up more than 80 million data points from the jagged rock and cave surfaces (the equivalent of taking a measurement every centimeter). The software provider helped the team determine the most Engineers used effective way to manipulate the 3D laser-scanning data in order to configure the technology to map space as required. The Annex II project in Valmeyer, Ill., and model the “The technology proved added 75,000 square feet of secure mine’s underground document storage. surfaces. to be an indispensable tool in repurposing this formerly aban- doned mine into usable office and storage space with numer- ous benefits to the surrounding community,” Brauer says.

22 ENGINEERING INC. NOVEMBER / DECEMBER 2011 MULTI-PROJECT FEATURE Colossal Pumping Station Guards New Orleans The West Closure Pump Station, part of the Gulf Intracoastal Water- way West Closure Complex in New Dennis Orleans, is two football fields long Kamber and capable of pumping 20,000 cfs.

Project: tion is longer than two football ARCADIS vice president and West Closure Pump fields, more than 100 feet senior project manager. Station, Metairie, high, and capable of pumping ARCADIS and HNTB La. 20,000 cubic feet per second developed the pump procure- Wayne (cfs) of internal drainage over ment bid package for the Welch Firms: the closure barrier. Eleven spe- contractor “to allow for early ARCADIS U.S., Inc., cially designed and constructed procurement of long-lead-time Highlands Ranch, pumps are powered by an enor- items, such as the pumps, Colo. mous 5,000-horsepower diesel engines and generators,” says engine. Dan Kellerman, HNTB vice Bioengineering The ARCADIS team began president. The team also pro- Group, Inc., preparing alternative studies in vided design coordination and Salem, Mass. 2006. By August 2008, team management of the station’s members had completed the substructure and all structural HNTB, innovation study. “Design of and architectural design of Kansas City, Mo. the entire station, from foun- the building’s superstructure. dation through final features, “Engineering studies deter- has been an ongoing process mined that 20,000 cfs pumping Dan n the wake of Hurricane in conjunction with the Corps capacity was necessary to meet Kellerman Katrina, Congress funded a of Engineers (COE) and project requirements, which, in massive $14.5 billion pro- the contractor,” says Dennis turn, determined the uniquely risky, so we and COE used gram to provide enhanced Kamber, senior vice president, enormous size of the station,” the Early Contractor Involve- flood risk reduction at the global water management for Kellerman says. “Designing a ment delivery approach,” says I100-year level for New Orleans ARCADIS. The firm was also pump station of such size had Kamber. and its surrounding parishes. responsible for project manage- never been done before.” And Though rarely used by COE ARCADIS, with joint- ment and coordinating design there were concerns about the for civil works projects, the venture partner Bioengineering, progress of GIWWCC’s other structure being situated on del- approach helped reduce risks and in association with HNTB, components. “We also designed taic soils marshland. Together, and improved time to delivery. was responsible for designing many auxiliary components, the team designed piles and a “Managing the design and the project’s $350 million West including the access bridge, the foundation to bear the correct construction of this project Closure Pump Station, part of safe house within the station, weight and vibration of the required an unparalleled level of the Gulf Intracoastal Water- the wastewater treatment and structure, and its many pieces coordination and innovation to way West Closure Complex potable water supply systems, of pumping equipment. provide this trustworthy com- (GIWWCC). fire suppression elements, and “Meeting the mandated ponent of the region’s new hur- The project is, by any defini- the fuel farm for the diesel completion date made conven- ricane risk reduction system,” tion, massive. The pump sta- engines,” says Wayne Welch, tional design-bid-build delivery Welch says. n

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 23 2011 ACEC Young Professional of the Year

AwardACEC presented five Young Professional of the YearWinners awards at its Fall Conference in Las Vegas. Selected by the ACEC Fellows, these young engineers were recognized for making significant contributions to the profession early in their careers.

Abbie Adams Emily Becker Amy Canfield Katharine Duitsman Ryan Sisson EA Engineering, Science Wright Water Engineers, AECOM Felsburg Holt & Ullevig Tsiouvaras Simmons and Technology, Inc. Inc. Middleton, Wis. Centennial, Colo. Holderness Sparks, Md. Denver Greenwood Village, Colo. A transportation engi- Duitsman is a rising Adams began her career A structural engineer, neer, Canfield specializes talent at Felsburg Holt A member of the firm’s at EA Engineering, Sci- Becker is involved in in the design of highway & Ullevig, where she transportation engineer- ence and Technology, all facets of water and corridors. She is project specializes in engineer- ing team, Sisson works Inc., as a mechanical wastewater systems, engineer for five high- ing solutions to traffic with clients throughout engineer in 2003. She from master planning way corridor studies, congestion. A transpor- Colorado, New Mexico now manages $1 mil- to design and permit- evaluating more than tation engineer, she is and Arizona, including lion in engineering ting. She has performed 300 miles of Wisconsin primarily focused on the Colorado Depart- projects supporting the construction observa- highway. In addition to I-225, a highway serving ment of Transportation $4 billion Base Realign- tion on numerous proj- planning and design, the Denver metro area (CDOT), the New ment and Closure ects, including a large Canfield has led a series and a primary route to Mexico Department (BRAC) program at regional stormwater of meetings and work- and from Denver Inter- of Transportation and U.S. Army post Fort detention and water shops to build consensus national Airport. others. Belvoir. quality pond, reha- for the U.S. 10 and WIS She is part of a team He recently com- She also uses her bilitation of a county 114 corridor studies. working to widen a pleted plans for a box exceptional skills to park water system and Canfield also is a segment of I-225 and culvert extension and mentor the next genera- upgrades to a wastewa- frequent speaker at extend light rail in the Saint Anthony’s Falls tion of engineers and to ter treatment system in a the Society of Women corridor. Duitsman is Energy Dissipator on benefit underprivileged mountain resort. Engineers’ “Engineering also a member of the State Highway 392, children. Adams coaches Becker is also a Tomorrow’s Careers” I-225/Colfax Inter- the first design of its junior staff, providing member of Engineers summer camp for high change project team, kind for CDOT. He leadership and teach- Without Borders and school girls. She is a which is designing filled multiple roles on ing engineering skills. traveled to Peru to work professional adviser for improvements for com- the project, including For four years, she has with a small community high school and college muters who need access project manager, struc- chaired the Day With in need of a clean and students and was co- to a nearby regional tural/hydraulic/roadway an Engineer program reliable water supply. chair of the 2006 Great medical hub and local design engineer and for her local Society The project included Lakes Regional, where businesses, schools and drafting technician. of American Military site selection and design more than 350 students neighborhoods. He also participates Engineers post, con- of a hand-pumped well and faculty from 15 She also participates in Engineers Without necting 100 high school and included public universities competed in in Girls Exploring Sci- Borders and the Insti- students with engineers health and community steel bridge and concrete ence, Technology, Engi- tute of Transportation to shadow for a day. outreach components. canoe competitions. neering and Math. Engineers.

24 ENGINEERING INC. November / December 2011 STAY COMPETITIVE The Best Athletes in the World Train Hard. Find Your AEC Firm Should Too. your next 40,000 Engineers engineer Choose RedVector for on ACEC’s ONLINE Training Job Board . . . Train your entire staff: where today’s engineering job seekers • Branded Online Universities go to find their next jobs. • Access to 1,100+ Online PDH Courses • LEED CMP Packages • Prices as low as $25 per user per month.

Test drive a free course, Green Building: Risk and Liability. (3 CE Hours) www.RedVectorEnterprise.com/green-risk

Since the ACEC Job Board’s 800-530-5184 inception in August of 2005, over 2,000 member firms have posted job openings and more than 17,000 job seekers have posted resumes. Find your next new hire at:

www.acec.org/jobbank/index.cfm

November / December 2011 ENGINEERING INC. 25 $ ITIT$ $ $IT $ $ IT $IT $ $$ $ $ Business Insights $ IT$ $IT$ $ $ $ $ $IT $IT$ IT$ $IT$ $$ $ $ $ $ $IT IT $ $$ $ $$$$ $ IT IT ITIT $$$ participants discuss IT $ $ Firms Brace for Tougher IT IT$ $$ integral and evolv- $ IT IT $ Government Acquisition IT IT $IT$ITIT $ ing business systems, IT $ITIT $IT$ $ $ $ $ $ $$IT And Compliance Rules including Citrix and $ $ $$IT $ IT $$ Engineering firms engaged in federal projects must confront sev- VDI, unified com- IT$$IT $$ $ $ $ $ IT $IT$ $ IT$ IT $ eral recent changes to federal regulations and guidelines, includ- munications, system $ $ $ $ $$ $ $ IT $ ing procurement integrity requirements, certification of overhead optimizing, machine/ $IT $IT$ IT$ $ $$ IT $ $ $ $$$ rates and environmental rules. Among the areas of increased user management/ $ $ $ $ $$$$ $ $$$ $ oversight and enforcement are federally funded transportation application and Auto- projects. ACEC has long advocated for more consistency among CAD/BIM/Civil 3D states regarding Federal Acquisition Regulation (FAR) rules gov- updates, SharePoint, erning federal-aid projects. general network tech- Several provisions in FAR Part 31 stand to impact design firms nologies and member that do business with the federal government, such as following benchmarking surveys. the cost accounting standards Where does your firm stand on these issues? ACEC set forth in the regulations and Member Firms may enroll representatives in either forum limitations on federal contrac- by contacting Andrew Fort at ACEC at [email protected] or by tors for recovery of ordinary calling 202-683-4330. Membership includes a listserv that business expenses. allows members to communicate year-round and invitations Robert Boyer, CH2M HILL to annual face-to-face roundtable meetings. vice president and former NAVFAC procurement officer, Institute for Sustainable and Wayne Owens, CPA, T. Wayne Owens & Associates, Infrastructure and Harvard will discuss the application Collaborate on of these rules as part of a new Infrastructure Rating course, Navigating Government Projects and FAR Requirements, System which gives engineering firm principals an inside look at The ACEC-sponsored Institute for Sustainable Infrastructure government procurement and compliance. The course will (ISI) and the Zofnass Program for Sustainable Infrastructure at be offered Dec. 5 and 6 in Alexandria, Va. To register, visit the Harvard Graduate School of Design will collaborate as part of www.acec.org/education/eventDetails.cfm?eventID=1304. a new partnership in support of sustainable infrastructure. The move merges ISI’s ACEC Member Firms EnvISIon and a rating tool Share Ideas on Vital developed by the Harvard Finance and IT Issues Graduate School of Design Given today’s volatile economy and challenging business climate, onto a common platform. it’s understandable why firms would be concerned about core For its part, ISI will look to integrate the tool into design projects operational issues. What’s the right finance and information across North America and will look to Harvard programs for in- technology (IT) strategy for improved business efficiency? How depth research to support its objectives. For more about the col- can we achieve success? ACEC’s Finance and Information Tech- laboration, log on to www.sustainableinfrastructure.org. nology Forums aim to answer these and other questions. Featur- ing focused groups of finance and IT professionals from ACEC The ACEC Institute for Business Management provides Member Firms, the forums present best practices and provide comprehensive and accessible business management education a collegial environment for professionals to problem-solve and for engineering company principals and their staffs. network. Visit ACEC’s online educational events calendar at Key topics addressed by the Finance Forum include organiza- www.acec.org/calendar/index.cfm or bookstore at tional challenges, the latest AASHTO Guide and FAR require- www.acec.org/publications, or call 202-347-7474, ext. 338, ments, General Accounting rules, 401(k)s, incentive compensa- for further information. tion, and mobile workforce and technology tools. On the IT side,

26 ENGINEERING INC. NOVEMBER / DECEMBER 2011 ITIT

IT

Your best read on the business of engineering Retirement Trust Column Navigating the Dodd-Frank Act and Performance-Based Compensation A Special Report From the ACEC • Planning Tips: The results of an SOP company may take with respect to com- Retirement Trust vote can be strongly influenced by pensation paid to a “covered employee” he Dodd-Frank Wall Street proxy adviser recommendations. Public to $1 million. “Performance-based Reform and Consumer Protection companies should seek positive recom- compensation” is exempt from this TAct was enacted July 21, 2010, to mendations from proxy advisers. To do limit. Properly structured equity awards, address the 2008 meltdown of the finan- so, companies should provide proxy including stock options and stock cial industry. Dodd-Frank continues to be advisers with the necessary information appreciation rights (SARs), can qualify a work in progress, with more than 385 to support the company’s executive as performance-based compensation. rules required and just 21 final rules in compensation structure. It is important • IRS Clarification: Securities laws place. The evolving nature of the legisla- to remember that advisers can make require that equity plans subject to tion means affected companies must navi- mistakes, and the company should shareholder approval must set forth gate a changing landscape of requirements. challenge mistakes and request any an aggregate limit for the number of Two requirements that stand to have necessary adjustments be made to the stock options or SARs that may be the most impact on A/E firm business recommendations. awarded. Proposed regulations issued through the end of this year and into 2012 by the IRS clarify that to qualify as include the so-called “say-on-pay” (SOP) Executive Disclosures performance-based compensation, and new “executive disclosure” rules. • Rule: Dodd-Frank imposes two new the plan must contain a maximum disclosure requirements regarding exec- limit on the number of stock options Say-on-Pay: Approving utive compensation: (1) disclosure of or SARs that may be awarded per Executive Pay “pay-for-performance” and (2) the ratio employee. An aggregate limit is not • Rule: Public companies were required of the CEO’s total annual compensa- sufficient, and the per-employee limit to hold their first SOP vote in the first tion compared with the median total must be submitted to the sharehold- shareholder meeting on or after Jan. compensation of all employees other ers in connection with shareholders’ 21, 2011. A SOP vote is an advisory than the CEO. The SEC should estab- approval of the plan. Comments on vote asking shareholders to approve lish rules regarding these disclosures the proposed regulations were due the compensation a company pays its sometime between now and December Sept. 22. Public companies should named executive officers. A SOP vote 2011. consider adding per-employee lim- must occur at least every three years, but • 2011 Impact: Even though the SEC its to their plans to the extent such shareholders are also allowed to vote on has not adopted the CEO pay ratio awards are to qualify as performance- having the SOP vote more frequently. rules yet, the “pay-for-performance” based compensation. Although advisory in nature, failed SOP theory played heavily into the recom- In addition to meeting the votes will send strong signals to a com- mendations made by proxy requirements of Dodd- pany’s board of directors that executive advisers on SOP votes. Frank, public companies compensation is excessive and could • Planning Tips: Com- seeking to take advan- lead to shareholder derivative suits if panies should begin tage of the performance- adjustments are not made. gathering the neces- based compensation • 2011 Impact: The 2011 proxy season sary data to calculate the exception should also be saw shareholders generally electing to CEO pay ratio. Furthermore, aware of recent IRS guidance hold SOP votes annually. In addition, companies should request that proxy issued with respect to stock options proxy advisers have been active in rec- advisers provide information regarding and stock appreciation rights. These ommending negative SOP votes. Many their individual performance measures rules, together with the “say-on-pay” of those recommendations have had for “pay-for-performance.” Including and “executive disclosure” rules of a meaningful impact on shareholders’ proper disclosures will likely be vital to Dodd-Frank, pose a number of new votes. Every company that failed to receiving a favorable recommendation requirements for which publicly held receive at least a majority approval of its from proxy advisers. companies should be planning. SOP vote previously received a negative recommendation from a proxy adviser. Final 162(m) Regulations This article is provided by the ACEC Proxy advisers have indicated that the And Performance-Based Retirement Trust for educational purposes most important basis for a favorable Compensation only, and is not intended to constitute legal or recommendation are a company’s “pay- • Rule: IRC Section 162(m) limits the financial advice. Please consult your attorney for-performance” policies. total annual deduction a publicly traded or financial adviser for more information.

28 ENGINEERING INC. NOVEMBER / DECEMBER 2011 Retirement Trust Column Members in the News

On The Move

STV Group, Inc., appointed Dominick The Michael Baker Corporation announcement, part of a planned suc- M. Servedio executive chairman and Milo announced the following appointments: cession, follows the recent retirement of E. Riverso president and CEO. Servedio, G. John Kurgan was appointed COO; former CEO Randy Sain. Jim Meads is who served as chairman and CEO for the Michael J. Zugay was appointed chief Sain’s president and CEO, and Joe Meads past decade, will remain chair of the board administrative officer, adding to his cur- is senior vice president. Also at the firm, of directors. Riverso, who served as presi- rent responsibilities of executive vice presi- Vann Rutledge, who was appointed dent and chief operating officer for the dent and chief financial officer; and Dale vice president and corporate secretary/ past two years, will assume responsibility Spaulding was named president respon- treasurer, also serves as controller. Becky for the firm’s day-to-day operations. sible for services for the state of New York. White was appointed vice president and Mohan Singh was named vice president principal in charge of transportation and Pennoni Associates announced sev- and senior director within the firm’s fed- environmental planning projects. eral appointments as part of a corporate eral business line. realignment following its acquisition Gannett Fleming promoted John W. of Patton Harris Rust & Associates Parsons appointed Brian P. O’Kane Kovacs to senior vice president and Mid- (PHR+A). Charles Perry, former senior vice president and infrastructure west region director. Jonathan W. Sink PHR+A president, was named senior division manager. He will oversee all was named vice president and serves as vice president and COO; Nelson global business activities within Parsons’ senior geotechnical manager and assistant Shaffer, executive vice president and infrastructure division. director of operations for the firm’s Florida former COO, was named chief admin- Geotechnical Group. Thomas G. Zink istrative officer. The firm also appointed Richmond, Va.-based H&A Architects was named a vice president and serves seven new regional vice presidents: & Engineers appointed Benjamin Lilly as bridge practice manager for the firm’s Andrew Bennett, Pennsylvania North senior vice president. He also serves as Northeast region and as deputy director & West; Ron Moore, Delaware, Mary- director of embassy programs. Human of transportation for its New Jersey opera- land and Washington, D.C.; David Resources Director Patricia Davison was tions. Thomas P. Daley was named vice Pennoni, Philadelphia Metro/Southern promoted to vice president. president. Based in the firm’s Newton, New Jersey; Susan Wolford, Virginia; Mass., office, Daley is a senior project David ­Lowdermilk, Transportation; and Jim Meads and Joe Meads are now the manager responsible for managing the Andrew ­Pennoni, Inspection and Testing. sole owners of Sain Associates. The New England transportation practice.

Dominick M. Servedio Milo E. Riverso Charles Perry Nelson Shaffer G. John Kurgan Michael J. Zugay

Dale Spaulding Mohan Singh Brian P. O’Kane Jim Meads Joe Meads

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 29 Members in the News

Welcome New Member Firms

ACEC/Arizona ACEC/Maryland ACEC/North Carolina EBG Engineering, LLC, Dallas Site Consultants, Inc., Tempe David Myers & Associates, LLC, ColeJenest & Stone, Charlotte H.J. Gruy and Associates, Inc., ACEC/California Salisbury Jamestown Engineering Group, Houston Boyd Consulting Services, San Hoffman Borowski and Associates, Inc., Jamestown HNB Consulting Engineers, Inc., Juan Capistrano Timonium Lighthouse Engineering, PA, Dallas CL Surveying and Mapping, J.K. Datta Consultants, Inc., Raleigh Jorge Perez Consulting Engineers, Rancho Cucamonga Baltimore Pabst & Hilburn, PA, Raleigh LLC, McAllen Coleman Engineering, Inc., Kumi Construction Management Teeter Engineering Group, PA, Kestrel Engineering, Inc., Houston Roseville Corporation (KCM), Baltimore Charlotte Mazingo Engineering, Inc., M.G. Wittgraf and Associates, Shah & Associates, Inc., ACEC/Ohio Houston Mbroh Engineering, Inc. Bakersfield Timonium Barr & Prevost, Columbus , Dallas Parkin-Perkins-Olsen Consulting Parc Civil, Inc., Oceanside Transtech Engineering Jedson Engineering, Inc., Milford SoundEarth Strategies California, Consultants, Inc., Columbia Engineering, Inc., Dallas ACEC/Oklahoma Inc., Stockton Sandia Technologies, LLC, Houston ACEC/Massachusetts Gonzalez-De La Garza & Structural Designs, El Dorado Sanpat Holding, Houston Doyle Engineering, Inc., Waltham Associates, Oklahoma City Hills Schmitz/Lamb Engineers, ACEC/Metropolitan Washington J C Engineering, PC The “G” Crew (TGC), Glendale , Owasso Houston Chu and Gassman, Washington, Jackson & Jackson Engineering WRECO, Walnut Creek , Specialized Hazard Services, LLC, D.C. Oklahoma City Houston ACEC/Florida Ecology and Environment, Inc., NewTran Solutions , Tulsa Turbonetics Engineering & Faulkner Engineering Services, Arlington, Va. ACEC/Oregon Services, Inc., Corpus Christi Inc., Tampa Project Management Services, Clearwater Engineering Group, Lochrane Engineering, Inc., Inc., Rockville, Md. ACEC/Virginia LLC, Bend Orlando Weston Solutions, Inc., Reynolds-Clark Development, Inc., SoundEarth Strategies, Inc., Meskel & Associates Engineering, Washington, D.C. Gretna Portland PLLC, Jacksonville ACEC/Michigan ACEC/Washington Wantman Group, Inc. ACEC/Pennsylvania , West Palm BETA CAE Systems USA, Inc., C.W. Felice, LLC, Redmond Beach Taras, LLC, Summit Hill Farmington Hills ACEC/Wisconsin ACEC/Texas ACEC/Georgia Geo Precision Services, Inc., Rives Himalayan Consultants, LLC, Galarraga Engineering, PC, Junction Architectural Engineering Germantown Suwanee ACEC/Mississippi Diagnostics, LLC, Spring Zepnick Solutions, Inc., Green Bay Kambill Engineering, Snellville Atkinson Engineers, Houston Airport Development Group, Inc., ACEC/Wyoming Robert and Company, Atlanta Axxis Building Systems, Inc., Jackson Lowham Walsh Engineering & ACEC/Idaho Carpenter Engineering, Inc., Benbrook Boa Marine Services, Inc., Environmental Services, LLC, Ruen-Yeager & Associates, Inc., Vicksburg Lander Coeur d’Alene Lang Engineering, LLC, Houston ACEC/Illinois Hattiesburg Petrocon Engineering Testing Mid-South Consulting, Inc. (MSC), Awards Jackson Labs, LLC, Belleville andy Toler, executive direc- ACEC/Indiana ACEC/Missouri tor of the American Council BFA, Inc., Washington Cornerstone Engineering, Inc., of Engineering Companies Indianapolis CM Engineering, Inc., Columbia C Indianapolis Testing Lab, EPIC Systems, Inc., Saint Louis of Tennessee, was recently named Indianapolis Losli Engineering, LLC, Saint Association Executive of the Year ACEC/Kentucky Charles by the Tennessee Society of Asso- Austin Engineering, Inc., Paducah Thompson Design Consultants, ciation Executives, the highest Short Engineering, LLC, Versailles PC, Kansas City honor awarded by the statewide ACEC/Louisiana ACEC/New Mexico organization. First Americans, LLC Integrated Logistical Support, , Espanola During her tenure, Toler has Hands Engineering, Santa Fe Inc., New Orleans increased participation for her orga- Candy Toler Royal Engineers and Consultants, Renaissance Engineering, LLC, nizations’ Day on the Hill by 50 percent and helped ACEC/ LLC, New Orleans Albuquerque Strategic Planning Associates, ACEC/New York Tennessee achieve its annual ACEC/PAC goal for seven con- LLC, Metairie Clifford Dias, PE, PC, New York secutive years through 2010. Toler also served on the ACEC TRC Companies, Inc., Baton Rouge VRX, Inc., New York 2008–09 Executive Committee as the NAECE president. The award recognizes individuals who exemplify the very best in association management and play an active role in civic and community affairs.

30 ENGINEERING INC. NOVEMBER / DECEMBER 2011 Calendar of Events November

30 The Electric Utility 14 Keeping Clients Industry: Where’s It for Life Going? The Black & (online seminar) Veatch Survey (online seminar) March PSMJ congratulates December 9-10 ACEC/Wisconsin Transportation the following clients 5-6 Navigating Improvement Government Conference, for these recently Projects and FAR Milwaukee Requirements, closed transactions: Alexandria, Va. April 6 Top Legal Concepts 15-18 ACEC Annual Every Engineer Convention and Should Know Legislative Summit, (online seminar) Washington, D.C. 7 Marcellus Shale FSC Architects and Engineers of Yellowknife, NWT upon its sale to Stantec, Inc. of Edmonton, Alberta Gas Development: June the Market and the Challenges 22-23 ACEC/Virginia 2012 (online seminar) Annual Conference, Wintergreen, Va. 13 Show Me the Green: Using Appraisal and Finance Techniques Technicon Engineering, Inc. of Macon GA to Get Your Green upon its sale to Clark Nexsen of Norfolk, VA Projects Going (online seminar) To sign up for ACEC online seminars, go to www.acec.org/education.

Additional information on all ACEC activities is available at www.acec.org. Clinard Engineering Associates of Nashville, TN upon its sale to Alfred Benesch of Chicago, IL Statement of Ownership, Management, and Circulation

Engineering Inc. (USPS 0007395) is published (bi-monthly) six times a year by the American Council of Engineering Companies. PSMJ is proud to have initiated the two The mailing address of the publication is 1015 15th Street, NW, 8th Floor, transactions in the United States and honored to Washington, D.C. 20005. The mailing address of the publisher is 1129 20th have served as the exclusive M&A advisor to the Street, NW, Suite 700, Washington, D.C. 20036. The publisher is TMG, the shareholders of all three selling companies. We editor is Andrea Keeney, and the managing editor is Corey Murray. The owner wish them all prosperity and a bright future. of the publication is the American Council of Engineering Companies. There were 20,638 copies of Engineering Inc. published for September/ October 2011 issue; the average for the preceding 12 months was 19,729. The To learn more about putting PSMJ’s M&A paid/requested outside county mail subscriptions for the September/October strength and experience to work for you, contact 2011 issue were 19,435; the average for the preceding 12 months was 18,857. Susan LeComte at [email protected] or The other classes mailed through USPS for the September/October 2011 issue 617-965-0055 ext.105. were 753; the average for the preceding 12 months was 540. Total distribution for the September/October 2011 issue was 20,188; the average for the preced- ing 12 months was 19,397. Copies of Engineering Inc. that were not distrib- uted during the September/October 2011 issue (office use, leftovers) was 450 and the average number of copies not distributed during the preceding 12 months (office use, leftovers) was 332. The percent paid/requested circulation www.psmj.com for the September/October 2011 issue was 96%. The average percent paid/ requested circulation for the preceding 12 months was 97%.

NOVEMBER / DECEMBER 2011 ENGINEERING INC. 31 Mergers and Acquisitions Large-Scale Consolidation Continues Despite Domestic M&A Slowdown By mike cauley s of Sept. 29, 238 to acquire global infrastruc- FSC Architects & Engineers (New York City); global industry ture planning and design (Yellowknife, Northwest Ter- • Manhard Consulting Amergers and acqui- firm Halcrow (London); ritory, Canada); (Vernon ­Hills, Ill.) joined sitions (M&A) had been • Tetra Tech (Pasadena, • TRC Companies (Lowell, forces with civil, sanitary announced, compared with Calif.) signed a defini- Mass.) acquired environ- environmental and munici- 186 for the same period in tive agreement to acquire mental consulting firm The pal engineering firm Cow- 2010, an increase of 28 per- Department of State con- Payne Firm (Cincinnati, hey, Gudmundson, Leder cent. Of these transactions, sulting firm PRO-telligent Ohio); (Itasca, Ill.). 118 involved a U.S.-based (Arlington, Va.) and min- • Terracon Consultants Larger firms continue to seller, almost equal to the 117 ing and industrial process (Olathe, Kan.) acquired use M&A to improve their domestic deals for the same engineering firm Metalica building forensics engineer- geographic footprint, add period last year. Consultores, S.A. (Santiago, ing firm Dressler Consulting more diverse services and Compare that against this Chile); Engineers (Overland Park, widen their client mix and/or year’s domestic M&A activity, • CDM (Cambridge, Mass.) Kan.); increase bench strength. M&A which through July had tracked acquired environmental • WSP SELLS (Briarcliff plays a critical role in improv- up to 12 percent compared science and engineering Manor, N.Y.) acquired ing competitive advantage for with last year. Taken together, consultancy E3 Consulting hydraulic engineering firm many firms. Some use M&A these trends indicate a clear (Brisbane, Australia); WAZ Engineering (Holly to add resources and scale. slowdown in domestic M&A • Stantec (Edmonton, Springs, N.C.); Others contemplate selling to activity. Alberta, Canada) signed a • Vanasse Hangen Brustlin a larger firm to reap benefits In August and September, letter of intent to acquire (VHB) (Watertown, Mass.) through changed ownership we saw the following (ACEC transportation infrastructure merged with transportation and increased staff. Still oth- Member Firms in bold): consulting firm ENTRAN planning, traffic engineer- ers pursue M&A to exploit • CH2M HILL (Englewood, (Lexington, Ky.) and multi- ing and research firm Eng- the void between smaller and Colo.) announced its intent disciplinary consulting firm Wong, Taub & Associates larger firms. 2011 Merger and Acquisition Sales Activity Through Sept. 29, 2011

2011 MERGER AND ACQUISITION ACTIVITY States by Total Activity: US vs Int’l Sellers: Firm Sales by State through September 29, 2011 21 or more Transactions Total US Sellers 118 To view live up-to- 16 to 20 Transactions Total Int’l Sellers 120 date versions of the 11 to 15 Transactions US Sellers to Int’l Firms 10 6 to 10 Transactions Int’l Sellers to US Firms 15 M&A heat maps that 1 to 5 Transactions accompany this article 4 No Transactions WA and to see a list of the 1 buyers and sellers in MT ND ME each state, go to www. 1 2 VT 1 morrisseygoodale.com. OR MN 2 1 6 NH 5 6 1 SD MA ID NY WI CT WY MI RI 2 5 2 IA PA NJ 1 NE 5 4 MD NV DE UT 4 OH DC 11 IL IN MD 1 1 WV 9 CO 1 CA 2 KS MO VA KY

6 NC 1 1 TN Mike Cauley is principal 5 2 OK 5 AZ consultant at Morrissey NM AR SC 1 Goodale, LLC, a MS AL GA strategy, M&A and 12 1 human capital solutions AK TX LA firm serving the A/E/C 6

FL industry. He can be reached at mcauley@ © Morrissey Goodale LLC 2011 All Rights Reserved morrisseygoodale.com. HI

32 ENGINEERING INC. NOVEMBER / DECEMBER 2011 20045 - Ad - Engineering Inc. - October-November 2011_Layout 1 10/27/2011 1:19 PM Page 1

Superior Value. Commitment to Safety.

Savings & Safety

At Jacobs, we saved more than $3 billion for our clients last year Architecture

through our JacobsValue+SM program and our commitment to safety. Construction In fact, OSHA recently recognized our passion for safety by awarding Engineering Jacobs OSHA’s distinguished Voluntary Protection Program (VPP) General Consulting Corporate Participant status — one of only eight companies to Maintenance Operations currently hold the designation. Planning Local and global, we are one of the world’s largest and most diverse Scientific providers of technical, professional, and construction services. Technical Services

Offices Worldwide www.jacobs.com 92% of engineering firms in the ACEC Life/Health Trust renew their policies — year after year.

When the ACEC Life/Health Trust aligned with UnitedHealthcare, a long-term relationship was forged. Each year, an impressive 92% of engineering firms who choose the ACEC Life/Health Trust remain customers — one of the highest retention rates in the industry.1 Here are just a few reasons why: · Preferred pricing: As an ACEC member, your firm may be eligible for favorable rates. · Satisfied employees: Chances are, employees’ doctors are in UnitedHealthcare’s provider network — 98% of the U.S. population has local access.2

· Easier administration through one-stop shopping: No need to look further than the ACEC Life/Health Trust for medical, dental, vision, life and disability. · No need to switch brokers: Our Designated Installation Team will work with the agent of your choice to make the move to the ACEC Life/Health Trust fast and painless.

Insured and serviced by: Learn why so many ACEC member firms have made the decision to join the ACEC Life/Health Trust and stay with the ACEC Life/Health Trust.

Call 1-877-233-0623 or visit uhctogether.com/acec1 for more information or to download our complimentary white paper.

The American Council of Engineering Companies (ACEC), the ACEC Life/Health Insurance Trust and Unitedhealthcare Insurance Company are three separate legal operating entities and, as such, the organizations are governed and function independently. UnitedHealthcare’s services are provided with the authorization of the ACEC Life/Health Trust. Questions related to health benefits offered through the Life/Health Trust should be directed to 1-800-573-0415. 1Renewal rate based on average year-over-year ACEC Life/Health Trust persistency metrics. 2Network statistic based on GeoAccess information and UnitedHealthcare standard network access mileage criteria, 2010.