Senator Talent Says Fiscal Conservatives Should Increase Infrastructure Funding Sen. Jim Talent (left) discusses the importance of transportation infrastructure with ACEC Chairman Ed Mulcahy. Missouri Senator Jim Talent emphasized his strong support for increased transportation funding, Association Health Plans legislation and renewable fuels like ethanol and biodiesel, during a meeting with ACEC officials last week. A long-time supporter of many ACEC issues, Talent will be the cover feature for the upcoming July/August Engineering Inc. During the meeting with ACEC Chairman Ed Mulcahy and ACEC President Dave Raymond, the Missouri Senator discussed his strong support for greater federal spending for transportation infrastructure, even though he is a fiscal conservative. "Fiscal conservatives should be supporting enhanced infrastructure funding because it is an essential and proper government function that will create jobs and economic growth," said Talent. In addition to backing the $295 billion TEA-21 funding level in the Senate bill, Talent discussed a provision he added to create a new Highway Infrastructure Bonds program, which will add an additional $15 billion in private investment for transportation infrastructure.

ACEC-Backed Tax Legislation Introduced Jim Nussle (R-IA) Congressman Jim Nussle (R-IA) has introduced key ACEC-endorsed tax legislation to preserve engineering firms' use of the "cash accounting" method to pay taxes. H.R. 2647, the Qualified Personal Service Corporation Clarification Act, would update the federal tax code and allow engineering firms to continue using the cash accounting method—where taxes are paid in the tax year when payment for services is rendered—as opposed to the accrual method, which requires taxes to be paid in the tax year the service is performed. "This legislation will help to resolve the uncertainty created by the current tax code, while preserving the option for engineering firms to use cash accounting," said House Budget Committee Chairman Jim Nussle, who also sits on the tax writing Ways and Means Committee. Congress last addressed this issue in the 1986 tax law which required most corporations with annual revenues greater than $5 million to use the accrual method. In doing so, Congress recognized that certain service providers, such as architecture and engineering firms, should continue to use cash accounting, since they neither manufacture a product nor carry any inventory. Since 1986, however, the nature of the engineering industry has evolved, as more and more clients want firms to not only design facilities, but also build, operate, maintain, and even finance those facilities. Engineering firms have evolved to meet these demands, but in doing so they have changed their internal structure in a way that puts at risk their ability to continue to use cash accounting. H.R. 2647 will remedy this looming problem by updating the tax code's ownership and function tests to ensure that A/E firms may continue to use cash accounting.

New ACEC Committee Steps Up Focus On Tax And Regulatory Issues In order to better address industry priorities on issues that affect all firms, including those that have substantial private client practices, ACEC Chairman Ed Mulcahy has formed a new Tax and Regulatory Affairs Committee. The new committee will focus on tax and finance issues, health care reform, pensions, ESOPs, the Fair Labor Standards Act, and other regulatory issues. Eric Flicker, CFO and treasurer of Pennoni Associates and the committee's first chairman, said that "these are the issues that affect all engineering firms where it matters most—their bottom line." Membership in the new committee is open to all ACEC members. For more information, contact Danielle Marks, ACEC's Director of Finance and Regulatory Affairs at 202-682-4306 or dmarks@acec.org.

ACEC Staffer Meets With Indonesian President ACEC Director of IT Services Yan Wiramidjaja (right) talks with Indonesian President Susilo Bambang Yudhoyono during a recent dinner party in Washington D.C. The Indonesian President had earlier met with President George W. Bush at the White House, where the two leaders reaffirmed the long-standing friendship between the United States and the Republic of Indonesia. Wiramidjaja is head of the Washington area Indonesia Community Association.

Printed ACEC Membership Directory Available Since 2003, ACEC has provided its Membership Directory at no cost to member firms and their customers at www.acec.org. Occasionally, we receive requests for a printed ACEC Membership Directory, and if there is enough interest, we will do a special printing to accommodate these requests. If you are interested in a hard-copy version of the directory, you must commit to purchase a copy no later than June 30, 2005, by visiting www.acec.org/store/memdir to place your order. Members $169/non-members $369. ACEC will make an announcement in July based on the responses received. Please note, if there is enough interest in the printed version, Membership Directories will be available for mailing in fall 2005. Your credit card will not be charged until the Membership Directory is mailed, but we are asking for a commitment at this time.

Copyright © 2004 by the American Council of Engineering Companies (ACEC). All rights reserved. No part of this newsletter may be reproduced, stored in any form of retrieval system, or transmitted in any form or by any electronic, mechanical, photographic, or other means without the prior written permission of ACEC.

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