Florida Congressman Kendrick Meek, right, discusses his strategy for defeating the 3 percent withholding mandate with ACEC Chairman John Hennessy, left, and ACEC President Dave Raymond.

ACEC Chairman John Hennessy and President Dave Raymond met last week with Congressman Kendrick Meek (D-FL), to discuss strategy for defeating the onerous 3 percent withholding mandate.

Meek is the lead sponsor of the Council-backed House bill to repeal the measure. The Florida lawmaker has gained bipartisan support for his bill and credited ACEC with helping to prompt his repeal effort.

"After meeting with ACEC, and some of your members, it became very evident to me that this was something originally intended to help the IRS capture tax dollars that weren't being paid, but it actually did more damage to the small business community," Meek said.

The complete interview will be published in the July/August edition of Engineering Inc.

The 3 percent withholding provision is an unfair federal mandate that will affect virtually every Member Firm. It stipulates that federal and state agencies, as well as some larger local governments, can withhold 3 percent from payments for goods and services.

Meek also called for more investment in the nation's infrastructure. "Infrastructure is so very important to our nation's quality of life and economic health," he said. "That's one of the reasons why there's a drumbeat now starting to invest more on the domestic front."

John Hennessy, ACEC Chairman

ACEC Chairman John Hennessy has joined the fight to stop New York City from dropping the requirement that the building commissioner be a licensed engineer or architect.

In a New York Times story published on Wednesday, Hennessy, a partner in Hennessy & Williamson in New York City, said it was essential to have a licensed professional as the building commissioner. He asked: "Do you want the health commissioner not to be a doctor? Do you want the city's corporation counsel not to be a lawyer?"

Contributing to the controversy have been several high-profile construction site accidents in recent weeks, including last month's crane collapse on the Upper East Side of Manhattan, killing two people and badly damaging a luxury apartment building.

Construction-related deaths in the city have already reached 15 in 2008, after totaling 13 in all of 2007.

City officials argue that that the city buildings department, which is responsible for construction site inspections, would be better run by a commissioner with managerial talent rather than technical skills. Hennessy and other industry leaders counter that the position requires a technical mastery necessary for assuring public safety.

"I'm tremendously concerned about construction site safety," said Hennessy, "but I'm also concerned about the long-term safety of buildings. Materials, products and building systems approved today have to last for the next 40 years."

Congress finished the first step in the 2009 budget process last week, passing a budget plan that seeks to address a number of important industry priorities, including restoring the funding shortfall in the Highway Trust Fund and boosting funding for environmental clean-up programs.

The budget resolution sets total revenue and spending targets for the coming fiscal year, and the parameters for the actual spending bills to be considered later in the year.

Of particular importance to the engineering industry is the full funding provided by the resolution for highway, transit and safety programs at levels authorized in SAFETEA-LU for 2009 ($41.2 billion for highways and $10.34 billion for transit programs), which effectively heads off harmful cuts to state transportation programs next year.

The resolution also eliminates cuts proposed by the White House to EPA, the U.S. Army Corps of Engineers and Department of Energy programs, including those that fund water infrastructure and environmental clean-ups. Specific allocations will be determined by the House and Senate Appropriations committees.

On the tax front, the resolution directs Congress to approve a one-year Alternative Minimum Tax (AMT) "patch" for 2008 to protect middle-income taxpayers from additional taxation. Of concern to ACEC and other business organizations is that the resolution assumes that taxes will increase by $1.2 trillion over five years, primarily by allowing most of the 2001 and 2003 tax changes to expire in 2011.

This would lead to reinstatement of the so-called "death tax," increased tax rates on capital gains and dividends, and increased income tax rates in the middle and upper brackets, which would significantly increase taxes on S corporations and other pass-through entities.

ACEC is lobbying House and Senate appropriators to move specific spending bills that cover key federal infrastructure programs. With congressional elections and the race for the White House in full swing, however, Congress may opt to delay final decisions until next year.