The Stimulus Package — Reality vs. Wishful Thinking

Most AEC firm leaders are realists, so they know that, despite the political rhetoric, the recently passed stimulus package is not going to make our industry’s problems go away. Nor will it solve the worldwide economic crisis.

It is going to help; even its critics would admit that if they were permitted to infuse a little honesty to go along with their strategic, partisan bashing of the move.

Hey, the stimulus package is far from perfect, and a small-government conservative is bound to despise most of this new law. At the same time, all indications are that we had to do something. And this is what we got.

To be fair, many in the Obama Administration and Congress clearly stated that the stimulus package is not a panacea. Let’s hope that AEC firms aren’t banking on the money from this bill to singularly carry them for the next couple of years, because it’s not going to happen. If a firm is on life support, the stimulus bill is not likely to save it. Firms need to keep doing all the things that made them successful in the first place — namely marketing hard (and smart), doing good work, taking care of clients, hiring and rewarding good people, being fiscally responsible, and so on.

For firms to benefit from the stimulus money, they need to be in position to do so. This means being informed about how and where the money will be spent (and most importantly, by whom). If a firm’s leadership hasn’t gotten close to the money source — for example, if it’s a transportation firm, keeping in front of their DOT contacts — they’re already facing an uphill battle because that’s what their competitors have been doing.

In PSMJ’s report, “The Obama Infrastructure Plan: A Supplement to PSMJ’s 2009 A/E/C Firm U.S. Market Sector Forecast,” American Society of Civil Engineers (ASCE) president Wayne Klotz says, “…the guys in the front of the line are going to get first money. If you’re not ready, it’s going to go to the next guy behind you. They need to know what projects are ready to move and how quickly they can get underway.”

Firms that will benefit should also keep the purpose of the package in mind. The goals are to create jobs and infuse money into the economy quickly. So projects that require manpower (i.e., jobs) and that can show immediate results are likely to get the first wave of funding. For an A/E firm, this could mean focusing on construction-phase design, design-build, or construction management type work.

Paul Meyer, executive director of ACEC-California, said in the PSMJ report: “There are projects in all kinds of stages and with that timeline, there is a lot of work that engineering companies can do. If anything, planning and design work gets more intense as you get closer to bid. And even after the bid, there are design changes, engineers are retained to conduct reviews…it’s a pretty dynamic process.”

Despite the attention paid to the “shovel-ready” requirements of the stimulus package, a second wave of infrastructure stimulus money is planned; some firms may choose to turn their attention that way. These projects may not require fast completion, but they likely will need to exhibit extraordinary value and long-range benefit. The more a firm can help a client identify and quantify the value of these projects, the better its chances of grabbing some of the stimulus bounty.

If you want to keep track of how the stimulus package is progressing, check out recovery.gov, the federal website set up to monitor the distribution and results from the stimulus package. This also brings up another point addressed in the PSMJ report — that the “unprecedented transparency” promised by the president may result in unprecedented bureaucracy. Firms should be prepared to maneuver through that minefield as well.

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