Minnesota A/E Legislative Review (Excerpts from a NSPEA News Letter)
 
Over the past 15 years there has been a continued degradation in the level of compliance with our Architect and Engineering Laws in Minnesota. The past year has seen it reach a level that has drawn the attention of the legislature and the contractors. It has been estimated that the overall compliance with the Architectural laws in Minnesota is less than 50% while the compliance with the Engineering laws is less than 15%. The next year will see the culmination of efforts to legislatively enact laws to legalize what the industry is already practicing. It is recommended that everyone who makes their living through their Architectural or Engineering license seriously consider how they will restructure their professions to compensate for the dramatic changes that will be forthcoming. How will you restructure your career or business if your market is reduced by 70%? Who will you be competing with if your particular segment of the market happens to be retained? What will happen to your compensation and the fee structure of the company?

In at least 2 of the last 3 years there has been legislation introduced in both houses of the legislature by multiple legislators to eliminate licensing of Architects and Engineers in Minnesota totally.

Last year the Senate Commerce Committee, which oversees the Board of AELSLAGID, (Architects, Engineers, Land Surveyors, Landscape Architects, Geologists, Interior Designers) requested the Senate Research Committee to look into the non-compliance and lack of enforcement of the Board of AELSLAGID and provide recommendations and a report back to the Senate Commerce Committee. The Senate Research Committee Report (8 pages) basically recommended that the Senate Commerce Committee convene hearings at the beginning of the 2001 legislative session with consideration to eliminate the Board of AELSLAGID and licensing of Architects and Engineers completely.

The resolution of the problem is very simple. All the Board of AELSLAGID has to do is demand compliance and to request that all building permits list the Architect and all disciplines of Professional Engineering. It is really that simple. If so, then why won't the Board of AELSLAGID take that simple step? That is the challenge.

It is not likely that the Board will be abolished. What is likely to happen is already documented in Minnesota Statute 242M, the law that licenses Fire Protection Contractors (FPC's). As a result of that legislation it is now legal for FPC's to DESIGN fire protection systems, without PE's on any project. It is anticipated the Electrical and Plumbing contractors will take this opportunity to include design in their licensing laws and thereby negate the need for PE's there also.

It is highly likely that the Senate Commerce Committee will recommend legislation to drastically reduce the range of projects that require Architects and Engineers. It would seem logical that the critical structures (hospitals, nursing homes, etc.) would retain the requirements. However, it would be extremely difficult to justify retention of the requirements that Architects and Engineers be required on simple structures such as office buildings, apartments, industrial buildings, etc. This will be especially true when the contractors will testify that they are already performing the majority of design on these structures. This is both through no Architects or Engineers involved, or those involved using performance specifications and passing the actual design on to the contractor to perform.

At the present time the contractors can testify that they perform the vast majority of design for all fire alarm systems, HVAC Control Systems and security systems. They will also testify that they already can legally perform the design of fire protection systems. The next step of their presentation will be that if it is not necessary for Architects and PE's in the critical LIFE SAFETY areas, then where IS the need for Architects and PE's in the protection of the health, welfare and safety of the public? Is it in the lighting layout, duct layout or building façade? What would your argument be to uphold the need for Architects and PE's who are not currently performing the design?

There are numerous organizations that could have a dramatic impact if they elected to take the simple, absolute step to demand the Board to seek compliance by the simple step outlined above. However, there is not any indication that those organizations will even address the need by the time the battle will already be decided.

After receiving this letter the MN SARA Board is determining their action on the outlined subject. NSPEA, National Society for the Preservation of Engineers and Architects, is a relatively new organization formed to address the outlined issues. They require all the help they can receive from other professional organizations. MN SARA feels it is essential we retain the AELSLAGID Board to protect the Life Safety Health, Safety, and Welfare of the public. However, we definitely need policing of non-registrants in the state, which should be the responsibility of the AELSLAGID Board.

Governor Jesse Ventura is proposing a major change in the tax structure for the state. The hit is going to be on Professional Services.

The Governor has indicated he will propose to the Legislature to take K-12 Public School funding off the Property Tax roles and fund Public Schools out of the State's General Fund. The Governor is expected to have fun with this issue as his proposal will be very popular with property tax paying voters. The State Legislature will be left to deal with making up the tax revenue difference by applying unpopular additional taxes to other areas. Some of those tax revenue sources already informally discussed are:

Increasing the State sales tax from 6 1/2 % to 7 % on items already covered.

Placing a States sales tax on non-staple food items, (i.e. soda, candy, popcorn, ice cream, etc.).

Placing a States sales tax on clothing.

PLACING A STATE TAX ON PROFESSIONAL SERVICES.

or

Any combination of the above tax revenue areas that can be made politically acceptable.

With regards to taxing professional services, a similar proposal was narrowly rejected by the Legislature several years ago. We fully expect this potential source of revenue to be discussed again. We also fully expect the medical and dental professionals to lobby hard against a tax on their services that would result in taxing the lower income portion of the population. Thus, an unpopular tax on medical and dental services would not be enacted. The attorneys will argue the same lower income logic of the clients they serve. Since the Legislature is made up of a disproportionate number of attorneys, expect them to exempt themselves. Design Professionals will be left to carry the tax burden of meeting public school costs. With little Design Professional representation in the Legislature, a new tax on professional services might actually be enacted into law. Taxing labor and personal services could also be applied to contractors, agents, realtors, and in general to all of the service-related sector in the State's economy.

This is on the Agenda for action in Minnesota. If passed, Architects and Engineers in all states can expect a similar agenda item.