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First the good news.  We were encouraged to see Sean Duffy confirmed as Transportation Secretary earlier today by the Senate, and we look forward to working with him.

Now the bad news. A memo from the Office of Management and Budget released early Monday could hit the pause button on a broad range of programs that touch our members and the projects they work on. And just now we are hearing that a federal judge has temporarily blocked OMB from implementing the memo.  We will continue to follow the developments on this.  But in the meantime, I want to fill you in on the Office of Management and Budget’s memo should this go into effect.

According to the memo, the pause is intended to provide time for agencies to review their existing programs and grants for consistency with the Executive Orders and other policy priorities announced last week. The memo provides that:

“Each agency must pause: (i) issuance of new awards; (ii) disbursement of Federal funds under all open awards; and (iii) other relevant agency actions that may be implicated by the executive orders, to the extent permissible by law, until OMB has reviewed and provided guidance” to the agency with respect to the information submitted.

The memo itself is very broadly written and has wide-ranging impacts across the economy. For our industry, member firms may receive temporary stop-work orders from federal agency clients and from state/local grant recipients until they complete their program reviews and/or receive additional implementation guidance. Some announced infrastructure grant awards that are not yet obligated (i.e. under federal grant agreement) may be withdrawn.

We’re circulating information on the OMB initiative, and we are creating an online clearinghouse for information on this and other executive actions announced by the Trump Administration that will launch on our website this week.  And on that topic, I want to address questions and concerns we’re hearing from firms about new policies centered around Diversity, Equity, and Inclusion (DEI) programs.

During his first term, President Trump issued an EO prohibiting both federal agencies and federal contractors from having DEI training for their employees. That order was rescinded in 2021 by President Biden and now has been reinstated.

The White House also issued an EO rescinding a 1965 Johnson Administration order preventing discrimination in federal employment and requiring federal contractors to engage in affirmative action to ensure equal employment opportunity, a move the Trump Administration says will “restore the values of individual dignity, hard work, and excellence.” With the rescission of the Johnson order, federal agencies and federal contractors are directed to cease any activities or policies aimed at “promoting diversity” or engaging in “workforce balancing.”

Importantly, the EO also requires federal contractors to certify in agreements that their firms do not engage in DEI programs. There are teeth behind this requirement: contractors may be subject to the False Claims Act if the Trump Administration determines that they are continuing what they term “illegal DEI” programs. Email boxes have been stood up at several federal agencies to receive whistleblower complaints from federal employees and contractors about attempts by employers to circumvent the DEI prohibition.

Specific to our industry, what implications will these policies have for our continued workforce challenges? To be clear: I believe that the more voices, experiences, and backgrounds any organization has around the table, the stronger that organization will be. That’s my personal belief. But for the purposes of this discussion, as it relates to our industry, there are demonstrable and compelling business reasons for broadening our talent net.

Consider: the US needs 400,000 new engineers each year; we are staring down the barrel of leaving one in three engineering jobs unfilled each year until 2030. Where does that talent come from? How do we bridge that gap? This isn’t just about social equity. It’s about enabling us to meet our obligations and keep our promises. Some industries may have the luxury of debating the importance of diversity, but ours must recognize the necessity of it.

Having stated that, is important to note that the Trump order prohibits what it terms “illegal DEI.” It remains to be seen exactly what that would entail, but at first blush, it appears that the orders are more about prohibiting exclusionary or discriminatory practices and less about dictating organizational priorities. In other words, we may be looking at a shift from “DEI” as program versus “diversity, equity, and inclusion” as practice.

As I stated at the outset, concerns over firm DEI programs are a part of a broader sense of uncertainty over this regulatory effort that is impacting projects and contracts going forward. We will be circulating more information in the coming days and weeks as we get clarity on the scope of these actions.

– Linda Bauer Darr, ACEC President & CEO

Date

January 29, 2025

Category

ACEC NEWS, ACEC NEWS / ADVOCACY, ACEC NEWS / ADVOCACY / INFRASTRUCTURE

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