FASB Chairman Robert Herz

In the face of ACEC and allied opposition, the Financial Accounting Standards Board (FASB) announced that it is deferring "indefinitely" the implementation of key portions of the Statement of Financial Accounting Standards 150 (FAS 150).

ACEC and its member firms have waged an aggressive grassroots campaign in recent months against the new standard. The Council also asked Congress to intervene, stressing in testimony before a Senate subcommittee this week the potentially disastrous effects the new standard would have on engineering companies.

"Our firms rose up in strong opposition to this flawed policy," said ACEC Chairman Eric Flicker. "And our voices were heard."

The proposed statement sought to require non-public companies to classify their stock as a liability or debt in situations where the firm automatically repurchases the stock at a specific time or circumstance, such as when a stockholder dies or leaves the firm.

During testimony on Wednesday before the Senate Securities and Investment Subcommittee, FASB Chairman Robert Herz came under criticism from Subcommittee Chairman Mike Enzi (R-WY) for not doing a better job of vetting the new standard within industry prior to implementation. Herz pledged to improve outreach as further changes are contemplated in the future.

In testimony submitted to the Committee, ACEC President Dave Raymond, while noting FASB's decision to defer the new standard, stressed that FAS 150, if implemented in the future as it is currently written, "will artificially and unfairly eliminate the net worth of many non-public engineering firms throughout the country." Raymond stressed that such a drastic shift of debt on the financial statements of closely held firms could jeopardize their ability to obtain new clients, loans, bonding and insurance.

Senate Panel Clears TEA-21 Reauthorization Bill; Critical Funding Provisions to be Considered Later

The Senate Environment and Public Works Committee on Wednesday approved a bill that reauthorizes the federal highway program for the next six years. The bill (S. 1072) authorizes $221.5 billion for highways, but major portions of the financing provisions were not included in the approved measure.

The Committee has set a goal of $255 billion in total funding for highways, and Chairman James Inhofe (R-OK) said during the markup that each state is guaranteed an increase of 10 to 33 percent.

Key financing provisions will be announced early next year when the bill is considered on the Senate floor, including the mechanism that will ensure each state gets at least a 95 percent return on their annual highway tax contribution and the state funding distribution formula.

Other Senate committees must still consider the transit and tax portions of the TEA-21 reauthorization. The Senate has set a goal of $311.5 billion for highways and transit over the next six years.

Earlier this week ACEC President Dave Raymond sent the Committee leadership a letter providing the Council's comments on key portions of the bill. Raymond noted in his letter that ACEC supports $375 billion for highways and transit over the next six years, and opposes any attempts to limit outsourcing by state departments of transportation. "Private engineering companies have played a key role in helping the states deliver federal and state transportation funding for infrastructure improvements," Raymond said. "We seek to continue this role in the next reauthorization bill."

Raymond also provided comprehensive comments on the environmental and planning provisions of the bill, which ACEC seeks to incorporate when the bill is considered on the Senate floor next year.

Japanese Engineering Leader Promotes QBS As "Selection Method Of Choice"

ACEC President Dave Raymond (left), Dr. Yumio Ishii (center) and Tom McNulty, ACEC director of environmental and international programs, discuss strategies to further QBS' reach in Japan and worldwide.

Dr. Yumio Ishii, the newly elected chairman of the Japan Civil Engineering Consultants Association (JCCA), met with ACEC in Washington this week to map out strategies to expand the use of QBS in Japan.

The practice of QBS in Japan is currently limited, but as Dr. Ishii stated, "My primary goal as chairman of JCCA is to establish QBS as the selection method of choice in Japan."

Dr. Ishii will take back to Japan ACEC materials and strategies designed to solidify support for QBS within JCCA and the other Japanese engineering organizations, and work towards overall acceptance of QBS principles within Japanese society.

Dr. Ishii's initiative is the latest step in what has been a successful year in ACEC's on-going effort to increase the understanding and use of QBS worldwide. At the International Federation of Consulting Engineers (FIDIC) convention this spring, ACEC successfully lobbied to revise draft FIDIC Guidelines for the Selection of Consultants to embrace QBS as the preferred selection method.

Gregs Thomopulos, chairman of ACEC's International Committee and strong QBS advocate, was elected to a four-year term on the FIDIC Executive Committee.

ACEC also has received a request for QBS materials from the Austrian Association of Consulting Engineers to assist them in establishing QBS in Austria.

SBA To Release Proposed Rule On A/E Size Standards

ACEC recently held meetings with the Small Business Administration (SBA) to inquire about details of an upcoming proposal to amend the small business "size" standard for engineering services. The current engineering size standard, $4 million in annual gross receipts, is used by federal and state agencies as a threshold to determine whether a firm is eligible to compete for projects "set aside" for small businesses.

While SBA is not divulging much information about the proposed changes at this time, ACEC has learned that SBA will be converting the size standard from a "gross-receipts basis" to a "number of employees basis." The proposed rules, which are scheduled to be published by year's end, will have a 60-day public comment period.

"It's always a concern when SBA toys with the size standard," said Kathy Dewkett, owner of Dewkett Engineering, P.C. "Depending on the size of your firm you could lose your ability to qualify for small business programs overnight."

ACEC is establishing a task force composed of small, medium, and large firm principals, to provide input on the proposed rules. Members interested in participating on the task force please contact Roger Jordan at 202-347-7474.

Make Plans Now To Attend "Engineering America's Future" — CCD/EEA 2004 Make your travel arrangements for all "Engineering America's Future" events with Delta and United Airlines, ACEC's preferred carriers. "Engineering America's Future," to be held March 15-17, 2004 in Washington, D.C., includes the Federal Markets Conference, Consulting Congress Day and the Engineering Excellence Awards Gala. Delta offers five percent off the lowest fare and ten percent off full coach. Call 800-241-6760, and use reference file #201131A. United offers five percent off any domestic published airfare or ten percent off unrestricted midweek coach fares. Purchase 30 days in advance and receive an additional five percent discount. You also may choose Area Pricing, a fixed airfare rate based on geographical location, which must be purchased seven days in advance. Call 800-521-4041 and reference Meeting ID #517SY. Watch for further conference updates on www.acec.org and in Last Word.

On-Site Seminar

2003 Mergers & Acquisitions Summit, ZweigWhite
December 3-4       Boston, Mass.

In a networking atmosphere, allow your firm to achieve its strategic growth goals — geographic expansion, adding new services or markets, diversifying client base, or augmenting existing staff. As an ACEC member, receive a $50 discount.

Click here for more information.

New SF330 Form Seminar

Don Evick (U.S. Army Corps of Engineers) & Tom Williams (GSA)
December 4       12:30pm to 2:00pm EST
Washington, D.C. or online

The SF330 form will be released in November, replacing the current SF254 and SF255 forms, which are required for all federal A/E proposals. Hear from two authors of SF330 on how to complete the new form, with an explanation on how it differs from the SF254 and SF255.

On-site space is limited. Click here to register.

See also Insider's Guide to SF330 Preparation in the left-hand column.

Market Forecast Series

Dave DeAngelis, Department of Homeland Security (Invited)
December 11       12:30pm to 1:30pm EST
Washington D.C. or online

Dave DeAngelis, deputy division director, Protective Security Division (PSD), Information Analysis and Infrastructure Protection Directorate (IAIP) at the Department of Homeland Security (DHS), is known as "the engineer of the organization."

DeAngelis manages a $1 billion grant program for the Office of Domestic Preparedness. He will discuss their budget, the selection criteria for projects, how to apply, and key contacts. Learn from a leading specialist from the DHS about the opportunities ahead for engineering firms.

Click here to register.

Desktop Seminars

How to Lead a Resilient Firm Without Losing Your Mind
Po-Sun Chen, ZweigWhite
December 10       1:30pm to 3:00pm EST

The best in-house strategic business planning efforts may make running a successful firm look like a straight path from A to Z-but the reality is that it's not a neat, sequential process. Whether you're looking to grow, break into a new market, or survive a down period, effective leaders must often make things messy before they make them better. Join Po-Sun Chen, ZweigWhite principal and head of the firm's West Coast management consulting group, for a Webinar session that focuses on the leadership, facilitation, coaching, and effective decision-making skills necessary to lead a resilient firm.

Members $199/non-members $249. Click here to register.

Ownership Transition: Options and Strategies
Paul Lurie, Schiff, Hardin & Waite and Lowell Getz, Lowell Getz Company
December 17       1:30pm to 3:00pm EST

If you missed this highly popular session at ACEC's Fall Conference in Phoenix last month, or attended this session and want even more strategies, then don't miss out on Paul Lurie and Lowell Getz's dynamic seminar on ownership transition.

Learn the advantages and disadvantages of an internal ownership transition, understand the options available in transferring ownership, and explore the principles of a merger or acquisition in order to gain the most benefits at such an important time.

Members $199/non-members $249. Click here to register.

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