Engineering Influence from ACEC
Episodes
Wednesday Feb 15, 2023
ACEC, APWA, and ASCE Discuss the Engineering and Public Works Roadshow
Wednesday Feb 15, 2023
Wednesday Feb 15, 2023
ACEC has joined the American Public Works Association and the American Society of Civil Engineers on a nationwide Engineering and Public Works Roadshow to demonstrate the essential value of engineering by spotlighting successful examples of design. In this episode of the Engineering Influence podcast, the three leaders of these organizations discuss how the Roadshow came about, its goals, its first event, and what is to come in 2023.
Featured in this podcast are:
Linda Bauer Darr, President & CEO, the American Council of Engineering Companies
Scott Grayson, CEO, the American Public Works Association, and
Tom Smith, Executive Director, the American Society of Civil Engineers.
Learn more about the Roadshow at www.infrastructureroadshow.org
Thursday Jan 26, 2023
Catching up with ACEC Board Chair W. Arthur Barrett II
Thursday Jan 26, 2023
Thursday Jan 26, 2023
ACEC Board Chair W. Arthur Barrett II was in our Washington office for new officer orientation this week, so we asked him to join the podcast to give an update on what ACEC is doing and what 2023 has in store for the Council.
Thursday Jul 28, 2022
A Closer Look at the Fed Rate Hike with Economist Ken McGill
Thursday Jul 28, 2022
Thursday Jul 28, 2022
Ken McGill with Rockport Analytics and chief economist for the ACEC Research Institute joined the podcast to discuss the Fed's 75 basis-point interest rate hike and what it means for the economy and the engineering sector.
Host:
Hi there, and welcome to the engineering influence podcast from the American Council of Engineering Companies. I'm Allison Schneider, ACEC's Director of Media Relations, and I'm joined today by Ken McGill of Rockport Analytics to discuss today's announcement that the Fed will once again raise interest rates. Ken also serves as chief economist for the ACEC Research Institute, which provides original research and analysis on topics vital to the business of engineering. Ken, thanks for being here.
Ken McGill:
Thank you, Allison.
Host:
Now let's jump right into it. Today, The Fed announced an interest rate hike of three-quarters of a percentage point. That's the same as they did in June. Now, this is the fourth rate increase in five months. Talk to us about what the Fed is seeing in the economy to take this action.
Ken McGill:
Well, clearly they're focusing on fighting inflation and, I think the CPI reading of 9.1% last month certainly was worrisome for all of us, but the Fed paid very close attention to that. And, that was at least part of the reason for a 75 basis point increase in the fed funds rate. Having said that, they're also aware that the economy — some of the real measures of the economy — are beginning to slow spending and even employment to some extent and some of the high-frequency measures of inflation are actually beginning to fall off of their peaks. So I think that was the reason that many of the analysts that thought we were going to a 100 basis point increase turned out to be incorrect.
Host:
This is of course going to make borrowing money more expensive. How do you see this announcement affecting our members?
Ken McGill:
Yes, absolutely. The increase in borrowing costs is going to hurt many sectors of the economy, construction and housing being one of the more dominant ones and one of the ones that get hit very quickly of course. When we talk about rising borrowing costs, you can think about the housing side that that's certainly going to cut into demand because affordability for mortgage rates alone becomes lower. First-time buyers certainly have more trouble coming into the market.
Ken McGill:
Particularly in the face of the increases in home prices that we've seen. On the other hand, when you think about non-res construction borrowing costs, there are also significant and there are knock-on effects that affect the pricing of materials and labor, as well as, you know, elevated in interest rates begin to permeate through the economy.
Ken McGill:
So, yeah, it's, it's not a good thing for construction. The question really is, um, things will begin to turn negative. Some of the indicators already have, as we all know, it's a question of just really how fast and how far things will fall off. Now for our members, as many of them know, A/E services tends to lead construction activity, and my guess would be that some of the construction indicators that are already beginning to weaken which suggest that they're already seeing in some of their bookings some weakness as well. They'll also lead us into the recovery that we will see as soon as inflation begins to fall off into and get closer to the Fed's target range of 2%.
Host:
You mentioned that target range. The fed has the dual mandate of maximum employment and stable prices. We know the labor market is going strong, but inflation data showed prices soared to 9.1% in June. It seems like with this action, the Fed's trying to walk a tight rope to slow inflation without increasing unemployment. Can you talk about that a little bit?
Ken McGill:
Absolutely. Their dual mandate — and it is a tight rope. When you think about the fact that those two things can actually be inversely related. Said differently, you know, fighting inflation with either increasing interest rates or going through quantitative tightening, which they're also doing right now, that slows economic activity. That's the point of raising those rates and the finesse part of it on the part of Chairman Powell and the rest of the Fed governors is just how quickly to attack inflation with rising rates or quantitative tightening such that the damage to the real side of the economy, employment and spending in particular is as small or as inconsequential as possible. It's a tight rope. And that's why analysts are constantly arguing about the difference between a rate increase of 50 basis points versus 75 versus a hundred. Those numbers sound fairly small, but they have huge implications for the real side of the economy.
Host:
With the way things are headed, there's been talk of a recession. Nouriel Roubini, the economist who predicted the 2008 crash, said "The idea that this is going to be short and shallow is totally delusional." His warnings go against, we should say, other predictions on Wall Street for a mild recession, including those from Goldman Sachs and Morgan Stanley. The Biden administration is reluctant to say a recession is on the way. What are your thoughts there?
Ken McGill:
I tend to lean towards the consensus that sees frankly, a recession coming, probably early in 2023 will be the start. But I also agree that it should be mild. And part of that, that logic is really taking a look at the real side of the economy right now. Employment, as you noted, is, has been very strong and should continue to be that way in particular, particularly because we've seen strength in manufacturing. But we're also seeing a lot of strength in service employment, be it leisure and hospitality or professional and business services. That's where the job strength has been these last 6, 8, 9 months. And that bodes well for consumer spending and confidence moving forward. So when you take a look at that, it's hard to imagine that consumption will fall off the edge of a cliff. It's hard to imagine that business investment — which lags that and follows it in the economic cycle — that it will completely dry up.
Ken McGill:
We've seen, inflation indicators, as I mentioned before, already beginning to suggest that we've seen a peak and things are starting to cool down. That will raise well, that will slow any losses in real income that consumers are seeing by the fact that if inflation is sort of eating away at their paycheck. Wages are still rising at a rate slower than, let's say ,the beginning of this year, but they're still rising. And if the Fed is successful in pushing, beginning to push inflation down, real wages will turn positive as well. And that bodes well for spending in the future. So I'd look at the real side of the economy and it's just, it looks strong enough to weather these fed actions. And if it does get pushed into a recession, it will be a mild one.
Host:
You talked about weathering these Fed actions. There's been talk that they will continue to raise interest rates through the end of the year. Do you have any preview on what we should be looking for or what we might expect?
Ken McGill:
Well, you know, we all tend to watch the same indicators that the Fed governors do. And, those indicators are suggesting, as I said, a slow down a cool off period, if you will. And in our minds, in our team anyway, we've looked at it and thought, "Okay, the fed will raise again in September and end November, frankly." And, but those, those increases will be slower. They'll be smaller. Maybe we'll see a Fed funds rate of maybe 4% by the end of the year. So, you know, whether they, they do a lot of that change from the two, two and a quarter, two and a half percent that we are now, to that 4% could happen, could be front loaded in other words. It's a function of watching those indicators and of course the monthly and weekly indicators of inflation. They'll probably stop in raising rates at the end of this year because the economy will have slowed enough and inflation will cooled enough to convince them that they should probably remain neutral for a while. If we do head down into a mild recession, maybe even more modest recession, they may actually start to loosen. Again, some analysts out there are calling for by the end of 2023, a hundred basis point decline in the Fed funds rate. So, you know, they're definitely watching inflation and watching the potential for a recession. And I think they'll adjust rate increases and eventually decreases accordingly.
Host:
Those are really great insights. Is there anything else you think our members should be aware of?
Ken McGill:
Well, I, I think I would strongly suggest that everyone keep an eye on the pandemic. In other words, there are non-economic risks out there to, to the outlook, both for inflation and for the potential for a recession. The pandemic is not over it's. You know, we're starting to see some of these variants take hold again. I think we still have these geopolitical challenges like the war Ukraine, and the fallout from that war — that could impact a lot of the thinking behind the Fed and the actual results that we see in economic growth and inflation. And finally, you know, watch those commodity prices. Everyone seems to watch oil prices or at least gasoline prices on a daily basis. We're already seeing them fall. I'm sure everyone's noticed that the price at the pump is down about 50 cents per gallon over the last, few months — actually a few weeks — and commodity prices are also starting to fall. That's good news for construction materials and supplies. It's also good news on the inflation front in general. So watch those non-economic factors that are out there, geopolitical risks and, and the pandemic itself. And then keep an eye on, on, commodity prices. I think they're a good indicator of, of where things are going for inflation in the near term.
Host:
Ken, thanks as always for your insights. There's a lot to watch here. So I have a feeling you'll be joining us again soon. This has been another installment of ACEC's engineering influence podcast. Thanks to our guest, Ken McGill of Rockport Analytics and chief economist for the ACEC research Institute. I'm Alison Schneider. Thanks for listening.
Wednesday Apr 13, 2022
April Economic Update for the A/E Industry
Wednesday Apr 13, 2022
Wednesday Apr 13, 2022
Welcome to ACEC’s March economic update. Each month, ACEC’s Erin McLaughlin analyzes the latest industry data and provides insights for the engineering and design industry. Here are the 4 things you need to know:
Number 1 –
Reduced immigration is causing economic challenges according to a new survey from the National Association for Business Economics (NABE). Eighty percent of survey respondents said reduced immigration during the pandemic has constrained economic activity and contributed to wage pressures. The engineering industry has an ongoing and growing shortage of talent, and the constrained immigration pattern of the last few years has exacerbated labor supply challenges.
Number 2 –
Unemployment was at just 3.6% in March near record lows, according to the U.S. Department of Labor. Economists generally consider full employment to be 4%. For the engineering industry, our work falls into the category of professional and related services. That category has just 1.6% unemployment.
Number 3 –
Inflation continues to rise, with the Consumer Price Index, or CPI, up more than 8 percent over the last 12 months, the fastest annual gain in more than 40 years. CPI data is provided by the Bureau of Labor Statistics and tracks prices across different categories including gas. Though politicians have suggested – or moved forward on – lowering or suspending the gas tax, ACEC does not believe that would not be a prudent or effective way to lower the cost of gas. In fact, just 14% of the economists surveyed by NABE recommended lowering or suspending the gas tax as a way to mitigate rising gas prices. The more favored approach was to release oil from the Strategic Petroleum Reserve.
And, number 4:
Total design and construction spending was up more than 11% this February, compared to the same time last year. The category remains driven by private residential spending which is up almost 17%, along with private non-residential up nearly 10%.
There you have it. The economic update series is one of ACEC’s resources for media and members. For a deeper dive, check out the full video on YouTube and all of ACEC’s popular Private Industry Briefs.
And we hope to see you later this month when the ACEC private markets team will hold a symposium discussing the healthcare, science and technology markets in Boston, Mass.
To learn more about ACEC’s full slate of private market offerings visit our website at ACEC.org.
Thanks, and we’ll see you again in May.
Tuesday Dec 21, 2021
A Conversation with Carey Smith, CEO of Parsons Corporation
Tuesday Dec 21, 2021
Tuesday Dec 21, 2021
We were pleased to welcome Carey Smith, the President and CEO of Parsons Corporation onto the program for a conversation about leadership, diversity in the engineering industry and what Parsons is doing to help Build Back Smarter with the newly passed Infrastructure Investment and Jobs Act. We were equally pleased to welcome our own CEO, Linda Bauer Darr to host the interview - chief executive to chief executive.
Transcript:
Host:
Welcome to Engineering Influence, a podcast from the American Council of Engineering Companies. ACEC's strength lies in its member firms and the diverse set of markets those firms operate in to serve the interests of their public and private sector clients. And it's always great to have the opportunity to bring on one of those firms to spotlight their work and really look at what they are doing to improve their communities and the world around them. And I'm pleased to bring one of those shows to you today.
Host:
I am pleased to welcome to the program Carey Smith, the President and CEO of Parsons. Parsons is a leading provider of technology-driven solutions, focused on the defense, intelligence and critical infrastructure markets. And they've been in operation for more than 75 years. Parsons provides technical design and engineering services and software products to address their customers' challenges, and they have capabilities in cyber security, intelligence, missile, space, connected communities, physical infrastructure, and mobility solutions.
Host:
Now Carey Smith joined Parsons in 2016 as President of the Federal Solutions business. She was promoted to Chief Operating Officer in 2018 and President and Chief Operating Officer in 2019. She was unanimously elected Chief Executive Officer of Parsons Corporation by the board of directors and appointed to the position in July, 2021. Now, prior to joining Parsons, Carey held a series of progressive leadership roles within the defense and aerospace industry. She holds an MS in electrical engineering from Syracuse University and a BS in electrical engineering from Ohio Northern University. In 2018, she received an honorary doctorate from Ohio Northern University for her outstanding contributions to the university and the field of engineering.
Host:
Now, interviewing a chief executive, sometimes it's best for me to take a step back and to allow a chief executive to interview a chief executive. So I'm also pleased to welcome our President and CEO Linda Bauer Darr to move us forward and take the mic. Linda, the floor is yours.
Linda Bauer Darr:
Great. Thank you, Jeff. I'm happy to be back on the podcast. I need to do this more often. You're doing a great job. So kudos to you, Jeff. Carey, we are so excited to have you in our offices. I think this is the second time in the short amount of time that you've been on board as the CEO of Parsons. It's been since July, I think now, right?
Carey Smith:
That's correct.
Linda Bauer Darr:
That you came on board and, it's a pleasure to be working with you. We're excited to have you here. So you're a CEO now - how did that come about? You know, you're an engineer, you're a CEO. What brought you into engineering? And, and tell me a little bit about how you made it all the way up to the top ranks of such a, such a significant company as Parsons.
Carey Smith:
Sure. Well, thanks first, Jeff and Linda, I'm pleased to be here and I appreciate you hosting me today. I'll start off. My dad kind of got me into engineering when I was really young. We had, I have one brother, one sister, he wanted all three of us to be engineers and one of us decided to be an engineer. So I went into engineering and one of my first experiences was working as an intern at LTB Steel in downtown Cleveland, really got hooked on the industry. Then when I graduated college start off, uh, with IBM, which subsequently became Lockheed Martin through acquisitions and had some great experiences. One of 'em I would highlight was being one of the first woman flight engineers to fly with special operations forces. So it's kind of in my blood, I would say. Um, and just an exciting field. It's an opportunity to make a difference.
Linda Bauer Darr:
Wow. That that's, um, there's so much there. I know we have a lot to talk about today in a short period of time, but I would love to just take a second to dive into that a little bit. So why was your dad so infatuated with engineering if he wanted all three of his kids to be engineer? So was he an engineer?
Carey Smith:
My dad was an engineer.
Linda Bauer Darr:
What kind of an engineer was he?
Carey Smith:
He was also an electrical engineer. So I followed in his footsteps.
Linda Bauer Darr:
Who did he work for? What kind of work?
Carey Smith:
He was with Morgan Engineering. So they built cranes for steel mills.
Linda Bauer Darr:
Out of Ohio,
Carey Smith:
Out of Alliance, Ohio.
Linda Bauer Darr:
Okay. And then you said that you were one of the first female flight engineers on a special operations mission.
Carey Smith:
Yes.
Linda Bauer Darr:
What what'd you do?
Carey Smith:
So at the time we were changing analog cockpits over to digital cockpits. So my job was basically to design the display formats. And then when the test engineers, when they were up flying, I was the flight test engineer. So I would sit between the pilot and the co-pilot and I would teach them how to use the new digital display systems.
Linda Bauer Darr:
Do you have your pilot's license as a result of that?
Carey Smith:
I do not, but I'll tell you, I've always thought about getting one.
Linda Bauer Darr:
Yeah. Something tells me that that's not beyond you and probably it's gonna be on your agenda for the future. Um, and then you went from IBM, which became Lockheed Martin. Obviously that's a thing in this business. I actually started out years ago in a company called EG&G that later was purchased by and you know, way down the road AECOM. So, you know, that's my only claim to the engineering profession before I came to ACEC and, um, man, you know, it's, uh, you never know where you're gonna be the next day. It seems
Carey Smith:
Like the that's absolutely true. It's spent a lot of consolidation in the industry.
Linda Bauer Darr:
It's really picking up. Um, that's another that's for another podcast though, Jeff, we'll try to stay disciplined. Um, so let's talk a little bit about diversity and inclusion. I know that that is a passion for you. It it's a passion for me. It is also a passion for ACEC and it's - we have five planks of our strategic plan, core strategic goals. And, and that is certainly one of them. Um, and you know, it's interesting trying to describe to people what ACEC sees kind of its unique lane in diversity and inclusion because we feel very strongly about STEM programs and bringing young people into this space. But, you know, traditionally ACEC has really been for the business of engineering and often focused on the leadership in engineering firms. You don't come in as a leader, you know, you don't come right outta college and become a leader.
Linda Bauer Darr:
It's something that evolves, but we feel really strongly about getting involved earlier on in the game for engineers that are on that track, right? That are on that path to become CEOs. So you are one of very few female CEOs of engineering firms, you an engineer, and that's not always the case. I mean, some of your colleagues are people that came into the profession as attorneys, or maybe they had a business development background. Um, so, you know, tell me a little bit about how you're taking kind of, you know, the, the perch of CEO of Parsons and moving the ball forward for people like you to come behind you and, and promoting that push for diversity and inclusion, which is so important to the future of this industry and this profession.
Carey Smith:
Yeah. So inclusion and diversity is one of Parsons', six core values. And it's obviously very important to me being a woman in, in the engineering field. So when I first joined the company, about five years ago, we stood up a diversity at the time it was called diversity and inclusion council. Today we call it diversity equity and inclusion council. Um, that has been one of the best initiatives in the company with many people, volunteering to participate. It's very active. We have ambassadors at each of our major locations across the company, and we also I will highlight, um, and promote it all the way up through our board. In fact, if you look at our board today, our board is about 40% diverse. So this is truly something that we take throughout the organization at all levels. We measure ourselves on diversity goals and we make sure that we're achieving the metrics. And the objective is really to try and make sure that every employee feels engaged at Parsons and is able to contribute fully.
Linda Bauer Darr:
Yeah, that is, um, that it, it sounds like, you know, it's, it was a, was a seed and it's grown and it's taking on more kind of speed and kind of heft as time goes along. And I met, you know, the way that you set it up, you described having an ambassador at each location, you know, with the company, the size of Parsons. It can't all come from you. I know you have pressure to be everywhere at once, right. At all these different locations, um, to try to kind of share your me message and your passion and your vision for Parsons. So how do you keep those ambassadors. kind of on message and how much do they have, um, kind of free reign to do their thing? How do, how do you package it all together with the company as large as yours with these ambassadors? Is it all these separate locations?
Carey Smith:
So we set up specific goals that we're gonna do as a, at the company level. So a goal might be one year we wanna improve mentoring across the company. A goal might be that we set up enterprise business resource groups. So they're basically affinity groups. And once we sort of have the corporate objectives, then we flow those down to each of the ambassadors. And the ambassadors do have the authority to do what makes sense in their local area, because each area, as you know, particularly in the engineering field is different. It's a lot different if I'm at a facility in Virginia versus a facility in California versus facility in Florida, right. So they can create events and activities that are meaningful to their particular location.
Linda Bauer Darr:
How do you choose who these ambassadors are gonna be? Do they have to represent a diverse constituency to begin with? Or how do you choose them?
Carey Smith:
We let them volunteer. Okay. Um, and we think that's the best way, because if you're selecting people, then they might not really be the right person for the job and might not put as much into it. So we really say, if we have a major site, let's say in New York city, and we have several hundred people working there, we'll have a volunteer on who wants to be the ambassador.
Linda Bauer Darr:
That's great. So we have at ACEC a Diversity Equity Inclusion and Belonging Committee. And I think it's like you, I mean, it started out the concept was inclusion and diversity, and it just continues to grow and obviously belonging and, and equity. Um, you know, with this new legislation, equity is much more important. But one of the things that has been interesting as this concept has grown and our involvement has deepened is how, how do you build the leadership of an effort like that? Because if it only people from, you know, diverse backgrounds, gender diversity, ethnic diversity, age, diversity, whatever, um, you might be missing out on the important buy-in that you need for, you know, that, that fever, if you will, the positive fever of really, you know, promot diversity and inclusion throughout the industry, uh, for that fever to grow. So, you know, we have had, we have, a couple of white men that are helping to lead this effort for us.
Linda Bauer Darr:
It so happens that they also happen to be CEOs of these, you know, some, some very significant firms that have taken this and really run with it. So, um, I would agree with you that, you know, it's the people that really have the most passion, but you need to make sure that it's people that have those experiences having been in the minority in some way, shape or form, but it's also the people that represent kind of, you know, the broader population of that particular industry or profession, because if they're not buying in, then not much is gonna change. So it really takes...
Carey Smith:
And ultimately to me, it comes down to diversity of thought and to get diversity of thought, you need engagement from everybody in your population, regardless of background.
Linda Bauer Darr:
And, and I think diversity of experience, you know, diverse experiences lead to that diverse thought. So we could go on about that forever, but we have something a little bit timely to talk about. And that's the Infrastructure Investment and Jobs Act that, you know, it really has got this whole industry buzzing. We're excited. This is a transformational piece of legislation. Um, I've never seen anything like this in my lifetime. I was born after the Interstate Highway System was, you know, conceived and built. So, um, this, but this is akin to that. It, it it's that big. I know that you all are really embracing the opportunities and you've got your own unique kind of spin on it, a campaign, um, that kind of plays off of the Build Back Better concept, but that is called Build Back Smarter. That's focused on tying traditional infrastructure with technology and innovation. It's great idea. I mean, in a nutshell, it's your grandfather's infrastructure, right? I mean, let's not do it the way that, you know, we've been doing it in the past because society and our planet and, you know, the way people, the digital world that we're in right now, people do things way differently. And so you need to, we need to adapt. And so engineers are leading the way on that. So tell me a little bit about how you all are doing.
Carey Smith:
So we're very, very excited about the infrastructure bill. It aligns extremely well with Parson's portfolio, whether it's transportation, including work that we do in rail and transit airports, ports, the water wastewater also ties into our portfolio - broadband, and even the utilities work we're involved in, utilities, um, work as well. So we're excited about the bill and what it means for our country. Also highlight too, that we're seeing a lot of growth in global infrastructure. So beyond the United States, there's a lot of spend that's being done in Canada, as well as the Middle East. So for pars, it's a really important time for the infrastructure portion of our business, because we're an advanced technology company. We have two pieces of the business. We have a group that is focused on federal government and really develops advanced technology like artificial intelligence, data analytics capabilities.
Carey Smith:
We have some unique uses of drones and we do a lot of work in cybersecurity. So we have the ability to build back smarter because we take our advanced technology capabilities. We apply those to the infrastructure side of the business. So if you think about some examples would be instead designing roads and highways for a 30 year lifespan or bridges tunnels, dams, how do you design them for a hundred year lifespan? You include sensors that can perform monitoring and basically give you better predictability. How do you use drones to be able to do inspection of bridges? How do you apply artificial intelligence to a system that does advanced traffic management to be able to get better predictability on accidents? When things would be cleared up, people moving around more safely, um, use of sensors for things like an intelligent intersection. You know, our intersections were kind of set and they basically didn't change for like three to five years now, post COVID we've got whole different traffic patterns. So how do we use the intelligent intersection so that they change dynamically and allow responders the ability to get through. So to encapsulate all that, it really means Build Back Smarter. Um, this is the opportunity to Build Back Smarter and really design for the future.
Linda Bauer Darr:
I love that. And, um, one of the reasons I love that so much is because it really showcases engineering, right? I mean, people talk about the Recovery Act, you know, during the Obama administration and shovel ready projects. And as you know, that, you know, that's a, that's a red flag for engineers when they hear shovel ready projects, because it means there's not gonna be a lot of thought going into, you know, laying down that asphalt and concrete, this is in a lot of people's views, you know, much better use of our funds because it does promote the sustainability. The long-term project development that you know, is, we're not gonna have to redo, you know, five years down the road.
Carey Smith:
Right.
Linda Bauer Darr:
You know, under having that predictability, having those sensors kind of accelerating our, um, you know, the, the way that we use the infrastructure to promote mobility and, you know, our economic backbone, um, it's exciting. And so you guys are right at the crossroads of that.
Carey Smith:
Yeah. It is really exciting, even, you know, a couple other examples. If you think about airports of the future, how those will be reinvented post COVID, you know, the whole way from the time you get outta your car, you go into the airport, you check in, you do your baggage, you know, you might have integrated health screening combined with ticketing, um, the way you drive up to park, that can all be different. It can all be used of sensors. So I mean, everything in our life really can be reimagined. We like to say at Parsons, we create the future, and this truly an opportunity to create the future of infrastructure.
Linda Bauer Darr:
Yeah. You know, it's you think about what the origin of the need for a lot of this is, and to some extent, I think we've all been spoiled by Amazon over the years. You know, and the easy button, you know, those concepts of, I don't wanna work too hard for it. And in this digital environment, I can just push a button and all this has been calculated. And that entry to the airport is a great example of that. You know, we're all in a hurry. We don't wanna expend a lot of effort getting all the checks, you know, done just for us to get on a flight, um, you know, for engineers to come in and figure out how to do it. That's a great example of problem solving that really is, you know, central to who our folks are as engineers.
Linda Bauer Darr:
So we are getting close to the end of our time here. I think I have a couple more points that I wanted to raise with you, and then, you know, Carey, anything you wanna raise this, uh, course, you know, I'd be, be happy to hear your views on what's going on and what you want us to know about what's happening at Parsons. But you know, you talked already a bit about cyber security and cyber protection of critical infrastructure assets. This is so important. It's important for our nation's safety. It's important for our economic safety. It's important for, you know, the privacy of consumers. You know, and we've, we've heard about so many engineering firms who have, suffered because of the bad guys that are out there. And, you know, they know that without our kind of hands in the middle of so many of these really critical projects that if we are vulnerable, they're gonna find a way in. And so you guys are really working big in that space. I'd like to hear a little bit more about, you know, how you think you all are gonna be able to kind of move the ball forward in that regard.
Carey Smith:
Yes. If you look at the Department of Homeland Security has defined 16 critical infrastructure sectors, and the way we approach it from Parsons is we look at areas that are highly regulated, that are high threat driven in areas that we have domain expertise, because the intersection of those three pillars is basically, um, we're differentiated in those markets. And those are the gonna be the ones that get the most funding as well, because they're gonna be the most under attack. So if you step back and look out at the 16 segments we play in transportation, we play in utilities, we play in facilities area and also in healthcare to just to name a few of the sectors. And what we can do that is unique is because we do have extensive cybersecurity capabilities. We understand, for example, how an airport operates. We understand how a port operates. We understand how a utility company operates. So we're best equipped to be able to provide that cybersecurity protection. And I would say it goes beyond cyber for information technology, because also have the operational technology component. So if you think about SCADA systems or industrial control systems, those were put into those sectors, basically without security in mind at the time that those were designed. So Parsons is able to come in and approach protecting different sectors, both from an IT perspective, as well as an OT perspective.
Linda Bauer Darr:
Right, so you know, it's, you said, those systems were put in place without kind of a consideration for security. They were put in place for efficiency. Right. And, you know, because we were on everything now we want it yesterday. Right. So now we're at a position we're in a position where we're really having to kind of go back and, and reinvent aren't we?
Carey Smith:
Yeah. Most definitely protect things, legacy systems that are out there. But most importantly, design with security in mind, as you put new systems, greenfield systems in place.
Linda Bauer Darr:
So, um, just take a minute, if you will, and tell me about some of the exciting projects you all are involved in right now, if you were gonna say, you know, here is the poster child of how Parsons is involved in innovative engineering solutions that, um, we want the world's policymakers to know about what kinds of things fall into that category for you?
Carey Smith:
Well, so I, I would say, um, starting with critical infrastructure sector, one of our biggest projects would be the LAX modernization program. That's an example of where we're a program, basically, an owner engineer, a program management office, providing support to what is probably the largest aviation infrastructure project that's underway. If I move around the world to the middle east, we're involved in some exciting programs, there, an example would be NEOM, which is a new city industrial city. That's gonna be built on the Red Sea. And NEOM is gonna be basically designed from the sand-up. So there's gonna be a new airport, for example, that's gonna be put into NEOM. We won a program management job there, and we're in the process of pursuing the airport opportunity. If I move around the world a little bit further up into Canada, we're involved in some of the major rail projects up in Canada - Edmonton Light Rail Transit would be a big one. And then on the federal side of our house, I mentioned cybersecurity's a big area for us, and that is to tied infrastructure, but we do a lot of work in the space area in terms of integrated launch, space, ground systems, and space, situational awareness. And then we're involved in some missile defense projects as well.
Linda Bauer Darr:
Wow. That really is a very diverse portfolio. That's gotta be a lot to keep up with it. One thing I'm noticing as you're talking about these projects, all are, you know, big and obviously impactful, hugely consequential, but if I am a 16 or 17 year old, and I'm thinking about going to college, and I'm thinking about changing the world, I wanna look at an engineering that is doing something that I know is gonna make the world safer or make the world ultimately healthier, you know, dealing with, for example, climate change, extreme weather issues. I think these are the kinds of motivating concepts where, you know, the people that are coming outta high school and college these days are saying, you know, how can I, how can I make a difference? You know, I don't wanna, I don't wanna just go to a nine to five job and, you know, sign a time sheet and push around a bunch of paper. I wanna make a difference. So what do you have at Parsons that's going on right now where you think the young people of today would be really inspired?
Carey Smith:
Yeah. So first our motto is we deliver a better world at Parsons. We deliver a world that is safer that is more efficient. And that's true whether it's the federal side of our business or the critical infrastructure side of the business. And what I would say to somebody at age is we're all about creating the future. I was asked recently, well, what company do you wanna emulate? And I said, we don't wanna emulate anybody. We're creating a company that is designing the future, whether it's future or transportation, or the future of defense or the future of cyber. That's what we're about. So I would say to a young person, if you wanna create the future, come join Parsons because that's what we're gonna be doing.
Linda Bauer Darr:
Right. That's and that's exciting who wouldn't wanna do that, right Jeff?
Host:
Absolutely.
Linda Bauer Darr:
That brings us to...
Host:
Well, um, right about right about time, actually, and that was a fantastic conversation. And I think it's a good example of the diversity of the work that, Parsons is engaged in and our, and our industry is engaged in, and for those listening who may not be completely familiar with engineering or, you know, it's that wide gamit of the services, the intellectual power of trying to solve complex challenges that make your lives better, uh, our lives better and also our nation more secure and productive. And, and I think from the conversation, it is, it's a good explanation that Parson is directly engaged in all of those fronts. And then of course it was a great opportunity to hear from two executives on, you know, really with this great opportunity with the Infrastructure Investment and Jobs Act and, and all of this potential that is there because now that the policy is done, we've moved to implementation and that's where it comes into our field to actually make policy translate into something tangible.
Host:
But this is, this has been great. And I do appreciate the time Carey that you've given us. And we look forward to working with Parsons as an active member of the ACEC community in the months and years ahead. And Linda, thank you very much for adding your expertise. And it's, it's always great to take a backseat to allow people who are actually doing things to talk about it. So thank you very much. And again, this has been Engineering Influence, a podcast from the American Council of Engineering Companies, and we'll see you again real soon.
Friday Jul 16, 2021
Friday Jul 16, 2021
ACEC was honored to welcome Rep. Chrissy Houlahan (D-PA06) to the program to discuss a variety of topics including infrastructure, her work as a founder of the Women in STEM Caucus in the House and her own experience as an engineer in Congress.
During the interview, Rep. Houlahan discussed a number of bills she is working on to get more people into the STEM pipeline, including the STEM RESTART Act, which she introduced along with Rep. Jim Baird (R-IN) and Senators Jacky Rosen (D-NV), Cindy Hyde-Smith (R-MS), and Mark Kelly (D-AZ), which is aimed at funding mid-career internships, or "returnships" for mid-career workers seeking to re-enter the STEM fields. More information on this legislation can be found here.
Rep. Houlahan is a member of the Problem Solvers Caucus, which endorsed the bipartisan agreement on infrastructure. We discussed that, as well as the PPP FAR credits clause issue, which ACEC is heavily engaged on through our advocacy team.
Thursday Jan 21, 2021
The Private Markets Update with Erin McLaughlin
Thursday Jan 21, 2021
Thursday Jan 21, 2021
ACEC's Erin McLaughlin joined the podcast for the first in a new series, the Private Markets Update. On today's show, Erin detailed the U.S. Chamber's State of American Business report, which ACEC contributed to. The report, provides an industry-by-industry breakdown of the challenges and opportunities America's businesses face in a COVID-19 economy.
Friday Aug 28, 2020
Friday Aug 28, 2020
Engineering Influence and the ACEC Research Institute welcomed WSP's John Porcari onto the show to discuss his work with the ACEC Research Institute on the New Partnership on Infrastructure and Accelerator for America's new report: "A Playbook for a new Infrastructure Partnership."
Host:
Welcome to another edition of Engineering Influence, a podcast by the American Council of Engineering Companies. It is my pleasure to welcome John Porcari to the program. John is a senior advisor at WSP and has an impressive history, both as the Deputy Secretary of Transportation in the Obama administration, where he was second command to then Secretary Anthony Foxx. And before that, John served two terms as Maryland Secretary of Transportation. His experience in program management, planning, design, and construction delivery is widely sought after by elected officials and policy leaders across the political spectrum. And it's fair to say that his insights and advice are of great value to presidential candidates, which comes up to a sharp focus this year with the general election. Mr. Porcari is now with ACEC member from WSP, where he oversees the firm's advisory services.
Host:
And not long after the ACEC Research Institute was established, WSP suggested that one of the first projects the group could undertake was the new "Partnership for Infrastructure," which is a program that's also supported by ACEC member from HNTB. Now, the Partnership's focus was to interview mayors across the country to better understand local and urban infrastructure challenges and develop a playbook of actionable recommendations. And when the project started in early March, there was a lot of buzz about the potential for an infrastructure bill, but no one could have imagined the disruptive impact of COVID-19. And on top of that, how urban protests would make us all think more about the state of America's cities. Los Angeles-based Accelerator for America interviewed the mayors for the playbook over the course of the Spring and assembled the recommendations and led the socialization of the recommendations and various online forums. The ACEC Research Institute participated in the process as an advisor and a financial supporter, but it doesn't necessarily endorse all the recommendations, but the playbook provides a great value for, firm executives and leaders in the engineering and the A/E/C space. It provides a lot of access to gain key insights into the tough local challenges facing our cities. The mayors are looking for problem solving partners to address complex societal needs. In some cases they want consulting help before they even have projects identified. Also the complexity of project finances, much more challenging today, and simply identifying funding for a list of projects. We all know what COVID-19 and the crunch on state and municipal budgets has really done to the industry. Now, this playbook is called the community serving infrastructure, a playbook for a new infrastructure partnership, and it can be found@acceleratorforamerica.org. The link to that document as well as supporting documents will be added up to the show notes on this episode.
Host:
That was kind of a long introduction kind of setting it up here, John, but I want to give you the opportunity. Number one, thank you for coming on. And number two, you know, for us in the beltway, you are well known as an expert in public administration, infrastructure transportation for those outside of the beltway who are politically active and are engaged in the A/E/C industry. Can you tell us a little bit more about your major interests and, and in, in, in the field and, you know, the turning points in your career that kind of got you to this point?
John Porcari:
Sure. Jeff, and thanks for having me here today. I, I've been very lucky in my professional career, in both the public sector and the private sector and in the public sector, as you pointed out, sort of at the local level, the state level is the Secretary of Transportation at the federal levels, Deputy Secretary of Transportation. And now in the private sector working to help clients get these projects across the finish line which is harder and harder. And we can talk about this a little bit, some of the things that are holding it back, but what's motivated me through my whole career is infrastructure is economic development. I started my public sector career as an economic development person working on major projects. And the more time I spent on economic development, the more there was a transportation and infrastructure linkage to it.
John Porcari:
So it's kind of a natural crossover into transportation. And that's especially true at the local level. We have this great system in the U S at the federal state and local level where each level of government has various responsibilities under our Federalist system, but we sometimes forget that the real actions at the local level. So the project decisions are at the local level, the priorities are established at the local level, and then you have to work your way through what can be sometimes some very difficult federal processes and regulations, for example, to get those local priorities built. So one of the reasons that we were very interested in working with Accelerator for America and the Research Institute to actually join us in that endeavor was we wanted to take a local lens to it and hear directly from mayors of big as the city of Los Angeles. And as small as cities like South bend and Waterloo, Iowa what on the infrastructure side they would like to change and this playbook we've put together some very specific recommendations through that local lens. That'll really help all kinds of infrastructure projects.
Host:
Absolutely. That's something which, you know, echoes throughout the country. I mean, my personal experience was in Congress with former Chairman Shuster, both in the personal office and then a committee and in the personal office, in his area of Pennsylvania, it was always economic development. It was always, you cannot have growth and opportunity without infrastructure, which naturally just tied directly into roads intotransportation networks, because the two are intertwined. And, and those decisions at the local level at the County municipal level really are the things that shape what that economic development is going to look like. So having a playbook, having some kind of a document, which looks and focuses in on the needs and the requirements of mayors and of people who are really active in local government is, is critical because it's not all at the top. It's not all federal. How, how did the accelerator for America? How did, how were they chosen to do this project? Why were they kind of the, the ideal group to, to undertake this?
John Porcari:
It's a great question. We began this discussion, this journey, essentially trying to take a local view to infrastructure by talking to some of the think tanks in the Washington area, some of the larger established organizations and it was such a different kind of view for them that they had trouble getting their heads around it. And so again, together with the ACEC Research Institute we had been working with Accelerator for America on specific projects. And as opposed to a think tank, the Accelerator is known as a do tank. These are mayors like all mayors and County commissioners and County councils that are out there working these issues every day. And, you know, if it works and, you know, if it doesn't at the local level, there's no hiding it. So a believer or not no one has done this before taking this local lens to infrastructure and tried to change federal regulations and requirements and programs to fit local needs rather than the other way around, rather than the experience of mayors and County commissioners across America is you have to kind of force fit what you're trying to do at the local level into whatever federal silo is out there.
John Porcari:
So we took the opposite approach Accelerator turned out to be the perfect partner for it. And the interviews, which were part of the process with mayors across the country, Republicans, Democrats, independents - party had nothing to do with it. Infrastructure had everything to do with it. And it truly is one of the bipartisan issues out there. We heard some common themes that turned into these recommendations in the playbook. Some are very specific, and frankly, some of them are relatively easy to do and would make the infrastructure work at the local level. So much easier, so much more freedom to adapt to local conditions.
Host:
Absolutely. It's really a paradigm shift because so much of the time we're focused on federal policy and programs. And those are developed, you know, with, with some thought and input from state DOT, administrators and such, but really it's, it's never given that focus from the local area because, you know, their needs should really bubble up and shape that policy, because if you're able to solve a lot of the problems with the local level, and a lot of the things that the consulting industry engineering consulting, engineering industry can come in and help in that process as well, understanding how to apply solutions to the challenges that are facing at the local level. It can speed project delivery can improve policy. At the national level, it seems like a natural model that hasn't been followed a lot by Congress. It's an interesting thing.
John Porcari:
That's exactly right. And, and the members of ACEC, I think could be very helpful in this and the the at the local level mayors and their counterparts don't have the luxury of thinking in the silos that the federal government operates in. And as you point out, the reality is that innovation doesn't trickle down from the federal level, it bubbles up from the local level and some of the more successful infrastructure work and infrastructure policies, and even projects have been local decisions that aggregate into a national system. And if, if you think about goods movement, if you think about moving people safely and efficiently they're really thousands of local decisions that together make the national policy not the other way around. We tried to reflect that in the playbook and make sure that the mayors were heard loud and clear on what their priorities were in our, in of course it varies all over the country based on local conditions, but to a person, they, they understood the fact that it's economic development it's quality of life, of their communities, it's building the economic future.
John Porcari:
So in one example, the highway right away is not just right away to them. It's, it's how their water and wastewater systems are conveyed as storm stormwater management. It's where broadband is bringing an economic future to these communities. And so they don't think of it as the state highway departments right away. They think of it is their economic future.
Host:
Yeah. And those, those city planners, those, those you know, local planners have to look forward on, on where's the growth and opportunity going to be, where can we actually create the economic development and how can we use all of those pieces of the infrastructure puzzle together to more effectively create jobs, or attract businesses? One of the big issues that we had in central Pennsylvania was trying to get headquarters with operations and, and trying to do it in such a place where you not only had right away or, or thoroughfare, but then you also have the actual wastewater, water, infrastructure, broadband, all those different aspects. And it's, it's, it's the, at the local level, you see more of the picture than you do if you're just sitting, like you said, in those silos, and you're just looking at one or two different things now, when this started, and we didn't have any idea of what was around the bend. I mean the focus of this project must have been impacted by the pandemic. And then, you know, the social issues layered on top of that kind of two part question, the first is how did it change scope, but then, you know, how did it, how did it also expand to, put a focus on to urban areas of, and their infrastructure needs and how they may have been underserved in the past and looking at what they might need to rebuild after the pandemic?
John Porcari:
It's a great question, Jeff. And we got some great direct input from these mayors. And so is one example. We talked to dozens of mayors across the Heartland of America small and medium sized cities where they're grappling with all kinds of issues, but, but again, trying to build an economic futureit makes sure they could do it. And as we started this project, the pandemic hit so it did change the infrastructure priority to some extent, for example one of the medium sized Midwestern cities that we were working closely with found that to do online instruction for their public school district almost 40% of their students didn't have access to broadband. You can imagine what that did to the priority of broadband relative to some of the other infrastructure priorities that they have at the same timethings like some of the transit service and planning for a future transit capacity changed as well, knowing that that economic lifeline of transit, connecting people to opportunities is, is every bit as important in some of these smaller jurisdictions as it is in large areas.
John Porcari:
And it was a go-no-go item for employment in many ways. So the, the it also at the same time with some of the storm events and natural disasters that we've had in the country while we were developing this, the whole idea of resilience, which really means something in practical terms terms at the local level resiliency is being able to operate your infrastructure, making sure your roads aren't flooded out and your water and wastewater systems work. And you actually have electrical power that can survive these events is something that is, is a very practical value at the local level and something that these mayors are very focused on. So as opposed to an esoteric discussion at the national level about resiliency and climate change the practical, nuts and bolts part of it is it changes infrastructure priorities at the local level. They see the facts on the ground and they have to respond to them. In real time.
Host:
I noticed in the last Congress near the end, the T&I Committee specifically was looking at a lot of different areas related to resiliency, and the word came up a lot more. But I don't think there was a complete appreciation for what it meant. Do you think that these stories and these recommendations from mayors can help fully flesh out federal law makers understanding of the importance of resiliency and what it means? It's not a political term, it's an actual, this is something that has to be considered.
John Porcari:
Yes, Jeff that's exactly right. It is not at all a political term. It's not some esoteric discussion at the local level. It's it's the practical impact of flooding where, you know, the prudent thing to do on the redesigned side is to upsize the the culverts. It's, it's where, you know, that having buried utilities makes them much more resilient for outages and storm events. The practical impact is something that we saw very clearly and heard very clearly from the mayors where they want to make sure that they're squeezing every bit of value out of harder and tax dollars for this infrastructure by making a durable. And future-proofing it to the extent that you can. So one of the great things about applying this local lens to infrastructure is it takes the kind of sterile Washington philosophical and political discussion out of this and puts the practical impact in there where these are people across the political spectrum, working side by side, acknowledging that building more resilient infrastructure is the smart thing to do from an economics point of view. And from obviously from a service delivery point of view for your city.
Host:
Absolutely. I know that there are four broad, which kind of form the focus of the document, and that's maximizing investment for a job and small business growth, empowering localities with effective tools and processes, funding, and financing for community serving infrastructure and making transformative investments for more resilient future, going back to the resiliency part, taking kind of that last one, since we're talking about that, like you said, the impact of, of, of looking at the local level and, and saying, like you said, you know, these power lines, you know, or what have you should be placed underground, or the covert should be made larger. I mean, that definitely will have an impact on those budgetary decisions. And, and especially with the way that the States are going right now having that cash crunch related to the pandemic how do you think the document's going to come into play with that?
John Porcari:
It's a great question. So there are some very specific recommendations related to resiliency, for example, that, that helped carry the argument for these cities to, to do things differently, but it also calls for a reset at the federal level. It's the, it's the local government saying, for example, that you need to form a federal infrastructure planning council. We have all of these federal agencies that don't even talk to each other, let alone work together on a regular basis at the local level, you don't have the luxury of, of building things in silos, organizational silos, this federal infrastructure planning council would be a forcing mechanism to get the different federal agencies like the Corps of Engineers responsible for all of our inland waterways, great lakes inland maritime transportation working with other federal agencies where they very seldom interact in practical terms where they do it's at the local level where you have local representatives and a local project that forces them to work together.
John Porcari:
So the idea is at the state and federal level to, to really highlight what some of those disconnects are, and in, in a very practical way, show how we can do a better job. And again, it recognizes the reality that's that's in our constitution and in the way we operate under federalism, but is not recognized in our institutional structures, which is those decisions and choices are made at the local level. And they should be but you don't have a federal partner that's necessarily recognizing that. And the federal share of funding in many cases in percentage terms is declining every year. So you have this ironic position of more local funding going into these projects, less federal funding, but federal regulation that makes it difficult to do business.
Host:
So how would that, how would that planning council be structured? Would that be executive level, or would that be kind of a congressional action? How do, how, how how's the playbook kind of see this happening?
John Porcari:
Well, it can be done a couple of ways, what the playbook focuses on are practical solutions. So for that planning council, the deputies level that the deputy secretaries and deputy directors in the federal departments by definition are the chief operating officers. And on, on important issues, they function is a deputy's council where they actually get together and work through issues. And what, what the playbook is saying is that for infrastructure planning at the deputy secretary at the deputy director level, we really should have that kind of coordination across the executive branch. Now, as you well know, from, from, from your background, these individuals report to all different committees of jurisdiction, but that shouldn't be the local government's problem. Right?
Speaker 3:
The whole idea is, is that you have the, the executive branch agencies working with each other to make it easier for the project choices and to build those projects at the local level.
Host:
So formalize the informal working groups into an actual council that meets and discusses infrastructure and creates a liaison for the States and for local governments to bring the ideas up, to be discussed at that operational level. That's right. And give them a specific agenda on where those barriers to cooperation are, where some of the loan programs are too restrictive and can't be used. The what you tend to do at the local level is try to get as much different kinds of infrastructure into every project that you do at the federal level. It's more of kind of a rifle shot approach where you have very narrow programs. So part of the agenda for that planning council for example, would be to broaden those programs to think more holistically to, again, frankly get better value out of these public investments by making the infrastructure more holistic and more comprehensive. It sounds fairly common sense. So, so how would, how would that, for example, you know, how would these policies accelerate, you know, improvements really that the brick and mortar infrastructure and the people really care about the, you know, you have the drinking and the wastewater, of course you know, Flint was, you know, still is the poster child for that, but then, like you mentioned earlier, we have, we have broadband, we have the issue with the gas tax and we have declining revenues, but have increasing, you know, via electric vehicle market, but we don't have a national electric vehicle charging infrastructure, you know, that's something which has to be addressed. And, and the other, those transformative areas that seem to be happening at the state and local level, of course, the States that are really ahead of the curve and trying to be centers of innovation and are starting to think of transportation, not in transportation sense, but as in mobility and, and, and as a holistic way of looking at things how would these policies help accelerate that the federal level?
John Porcari:
Yeah, it would do. It would happen a couple of ways. One I mentioned, which is most infrastructure projects of any size are not funded anymore. They're financed. And that's, that's a very important difference where it may be a 50 or 70 year lifespan piece of infrastructure that has a 35 year loan against it. Broadening the eligibility of those loans would be one thing, expanding the capacity of the federal loan programs, whether it's for highway or transit, water or wastewater. If you just look at the lead pipe and lead contamination issue, the, the existing federal programs capacity for loans is only a fraction of what you would actually need. And it's not just Flint, Michigan it's cities and towns across the country and rural areas. It's also other federal policies. So electric vehicle tax credits can be expanded, accelerated depreciation, all the kind of tax policies that actually trigger private sector investment in infrastructure or public private partnerships is, is something that can be encouraged through these recommendations. And the idea was to be w was, was to try to address the infrastructure needs and be agnostic on whether it's publicly addressed or privately addressed, or a partnership between the two but across the spectrum to try to identify some of these very specific recommendations that that can actually make these things happen.
Host:
Yeah, and that's a very important point because earlier in the couple of months ago, we did a, a round table discussion on the future of funding and transportation. And we had some, some policy think tank guys. We had Jeff Davis and Eno, and we had some thought leaders from Harvard. We had kind of a mixture and everyone agreed that, you know, reliance on farebox revenues especially now. I mean, you can't do it, you can't do it. There has to be a, there's not one solution. There has to be a number of different solutions to broaden the type of financing that you can actually go for for these projects that, you know, just relying on trust, run revenue, for example, is, is something which is, which is difficult in a time of declining revenues. Is there a recommendation on the trust fund within the document?
John Porcari:
It doesn't make a specific recommendation on the trust fund. The participants in this study, like everyone else acknowledged that's that it has to be changed. The system has to be changed. There's no, there's no trust in the trust fund anymore, right? If the Congress has to keep putting general funds and other monies into the trust fund, it's actually not a trust fund where and especially with the recession related to the pandemic, we're seeing trust, run revenues declining very rapidly. But the idea would be to at the local level and the federal level to open the aperture for more innovation on the funding and financing side. And there are jurisdictions that have limitations on how they can raise local funds. These local bond issuances and referenda and local other kinds of local self-help initiatives are limited in many places yet.
John Porcari:
They're actually the primary funding source of the local funds for many of these infrastructure projects. So opening it up across the board and making a better case that infrastructure is actually an investment. Yes, it's an expenditure, but infrastructure given its lifespan and given the economic activity that generates is actually a good investment. Whether it's airports and air service highway transit, the utilities that provide services you simply can't have economic growth and the quality of life we all want without that infrastructure investment.
Host:
And, and I know there, there are a couple of ideas about state local road transfers and federal funding for betterments. Can you go a little bit more into that? You know, what problems are we solving by transferring road ownership from, from state to local governments and, and what is the focus on betterments about?
John Porcari:
Sure, let me take each of those in turn so that the road transfer part of it is a recognition that the primary purpose of any given road may change over time. So in every state, there are state routes, the numbered state routes that were probably very important from a regional point of view maybe back to the horse and buggy days. But that state route is now main street for a town or city. And in that municipality it's serving a very different local function as opposed to the regional function that was originally built for. And so who would be the best steward of that? Who would use that right away most effectively for all the things we talked about, water and wastewater, broadband, burying electric utilities transit service, maybe dedicated transit lanes inductive charging in the next few years.
John Porcari:
The idea is that some of the functions of those roads, which were much more of a state function in the past local function now, it's not true in every case. The idea is to look at those individually and see where it makes sense it might have been for that state route example, 75% interest state regional traffic before. And it may be 25% now. So who would be the best steward of that? The betterment issue is a really interesting one, the when there's a hurricane or tornado or storm event that does significant damage for example, to our highway infrastructure. There's, there are emergency relief funds from the federal government to rebuild that in this highway example and until not too long ago about eight years ago, you could only rebuild that highway the same way it was built before you could not put in bigger storm drainage culverts.
John Porcari:
You couldn't raise the elevation. The idea of betterment is now accepted and it's federally funding eligible where you could rebuild that highway. And now you can do it with transit. You can pull it out of the flood, plain, you, you can armor it in ways where you're not rebuilding the same facility time after time with federal money, emergency relief money, every time it's common sense, but it's something that literally was not allowed until fairly recently. And so one aspect of resilience is to make sure those betterments rebuilding smarter every time is built into the core of what we do.
Host:
Yeah, that's a really good point and it makes complete sense. And I know, but it's the kind of thing that, that from an, you know, from an industry perspective, when, when a firm like WSP or a firm, you know, another ACEC member firm is brought onto a project, you know, they're of course working as a trusted advisor to their client to be able to say, okay, well, this road is built this way, but what we know of, you know, past events and you know, our expertise that we bring into it is that you should be improving it in a number of ways. And here is our expert consultation on how to, how to do that. And, if that idea is, is adopted by a broader swath of the States, that it means that you're going to have an improvement overall in the length and the value of infrastructure, like you said, stretching that dollar, that taxpayer dollar further, and just rebuilding a road exactly how it was. And it's just going to be washed away or destroyed in an earthquake, or what have you again,
John Porcari:
Right. That's right.
Host:
Now we talked about fund financing. We talked about the betterment issue. I know that the plan has a few deregulatory ideas on, on project delivery and cutting red tape. They include accelerated procurements reviews, the permitting, P3 processing. I, you know, we've heard a lot of these ideas from state officials. Did it really surprise you that a lot of these priorities were also coming from mayors who were interviewed?
John Porcari:
Not really the, the more time you spend with mayors, the more you see that they really are hands on problem solvers. So the one of the specific recommendations shortening the procurement cycle is basically the the city's asking the federal government to do what they've already done. We had a mayor for example, that during the pandemic cut their procurement times by 50% and just did it they're meeting all their legal criteria. It's there's no part of the procurement process that's been compromised, but they literally shave 50% of the time off. And the idea is if you can do that at a local level, it can be done at the federal level too. And it, if you do it at the local level and you don't have a federal partner that also cuts their response time and their review time, it doesn't help because you have to get ultimately get there. Okay. Anyway, so these are commonsense forms that don't really don't compromise the quality or the integrity of the process or the project. But what, what the recommendation is really saying is we can do it at the local level. We'd like our federal partners to do the same
Host:
Now to kind of wrap it up. I know the last areas, it really kind of goes into the job creation and employment issue, which is, which is especially important now with the effects of of the pandemic on, on employment. But the playbook discusses a number of of different areas. Here are the importance of training centers of local and targeted construction hires and support for small and medium sized businesses and, and the importance of, of expanding federal research into a lot of these emerging transportation and, you know, planning and such, where do you see this going? You know, what area in this kind of gets your attention the most?
John Porcari:
Well from a local perspective, this was a really pressing issue as well. So part of it is trying to squeeze again, as much value as you can out of tax dollars, by making sure the money stays in the local economy, to the extent possible. You know, at the end of the day, these infrastructure jobs or jobs you can't export, they are American jobs. And as an industry, there's a lot we can do to maximize that. But it also it also talks about taking projects as an opportunity to move people up the skill scale. So if you are learning a skilled trade from a laborer to say high voltage, electrician or welder is part of that project. You have brought someone into the middle class and doing that. And there's a whole ecosystem that could be helpful to that.
John Porcari:
The community colleges that are operated at the local level, we'll put together a training course for anything there's demand for. And there's a little bit of a chicken and egg aspect of this, where you need to make it, if it's clear, the demand is there for skills training, as part of infrastructure construction, the training will be there through private programs to community colleges, through unions and others, lots of providers but what we have not done and, and you can't do at the local level by yourself is systematically put, put that together into a system that lifts people up that skills ladder and provides better opportunities.
Host:
And that that's, you know, cross jurisdictional, because that's not just, you know, infrastructure or transportation policy, but it's educational policy at the, at the national level. It's how, how do you, how do you make the two kind of fit together, which shows, you know, the size of the task, but also the value of these recommendations to inform especially federal policy makers. Since it's an election year, I can't not ask the question. How has this playbook been received by the candidates have you or anyone else from, from, you know, who were leading this charge brought this to either the presidential campaigns or, or any of the the leadership and at the federal level to say that if, as you're, as you're developing policies, keep this in mind.
John Porcari:
It's a great question. At the beginning of this discussion, I mentioned that this is very much a bipartisan effort by bipartisan mayors. And so the playbook recommendations have been made available across the board people on both sides of the aisle have been briefed on it. I will just tell you from my personal perspective and personal experience and full disclosure, I'm a strong supporter of vice president Biden. The uptake of these ideas and, and concepts behind it has been very positive. There's a recognition that, that again, the innovation's at the local level, the decision making's at the local level, let's make sure we're letting our local elected officials make they know what the right choices are for their jurisdictions. Let's back them up and support them with federal policies that actually help them as opposed to getting in their way.
Host:
That's a really good point. And I think a good, a good area to, to leave it on. John, do you have anything else to add about the playbook? It, we've covered a lot of ground here. We know a lot of the recommendations, but is there anything, any, any final parting thought that our listeners should know going out of it?
John Porcari:
Well, I, again, this is, this is from a local perspective and it's very practical as mayors are. So there, there's nothing in here that can't be implemented ACEC members around the country should really think about how this can help locally. To a person ,the members are working at the local level, helping with those local choices, literally use the playbook for what it's intended to be, which is a way to help you with infrastructure, construction and, and in a more general sense, help make the connection between infrastructure and economic growth and prosperity. And the fact is, you know, if we're honest with ourselves, you can look at infrastructure coast to coast here, if you're honest with yourself, and you look at that infrastructure more than likely it was built and paid for by your parents, or maybe your grandparents, and in some cases, your great grandparents. So, it is just irresponsible of us not to invest in the future. It's the best thing we can do for the country going forward in terms of thinking about the future.
Host:
Yeah, really good parting thoughts there, because I think that one of the things that our members are very busy running their firms are very busy of course, with the work that they have ahead of themselves and running an office from the time of pandemic. But we can't lose sight of the fact that, that from an industry perspective, we're the thought leaders who can help drive these decision making processes at all levels of government that as an ACEC member, as a professional engineer and a business leader, there's a platform and there's expertise that our elected officials can't get anywhere else. And if they're able to use this documentthe playbook as a way to inform their thinking and develop their own thinking it'll help raise the profile of the industry as a whole, which is of course, one of the focuses of the institutes, you know, one of the key missions is to support the growth and the thought leadership of the industry.
Host:
But, you know, from a business sense, it'll, it'll make you more competitive when you're going for business, because you can put that economic argument behind it. You can put that, you know, like non, non partisan political argument to, to tie it all together and justify a project. I guess I do want to put a plug in because the, the ACC research Institute coming up in the, in, in, in next few weeks is going to be delving into aspects of the playbook. We're going to be doing some round tables on the playbook in conjunction with Accelerator for America. And we had our first series of round tables on the future of engineering. They were very successful and we look forward to another successful series coming up in, in only a few weeks but more information on that's going to be coming up shortly.
Host:
So stay tuned. We are going to post up the the, the program on the show notes, we will have a link to the, to the Accelerator for America website. And then of course, that will have the link to the playbook. John, I really appreciate your time today. Thank you so much. And I know our listeners really benefited from hearing your views and your expertise.
John Porcari:
It's my pleasure. And I do want to thank the ACEC Research Institute, and also everyone who's involved in putting this playbook together, because it took a lot of hands to actually get a nationwide perspective here.
Host:
Well hopefully we can have you back on the show a little bit later after we have those round tables and kind of maybe after once we get a better idea of what happens in November, and we get a better idea of, you know, what infrastructure policy might look like and either administration it might be good to revisit these issues. So until then, again, John Porcari, He leads advisory services at WSP, but he is also just a very, very knowledgeable individual when it comes to federal and state and local transportation policy. And thank you so much for being on the show.
John Porcari:
My pleasure, Jeff. Thanks.
Host:
And this has been Engineering Influence a podcast from the American council of engineering companies. We'll see you next time.