New York's engineering firms need more flexible ownership

To remain competitive, retain small businesses and promote economic growth, New York should end its restrictive policies when it comes to ownership of engineering firms, according to The American Council of Engineering Companies of New York, an organization representing 280 firms with over 100,000 employees worldwide, the New York Society of Professional Engineers and the AIA New York State. These groups are aggressively seeking passage of a New York State corporate governance bill to change current business corporation law that restricts ownership in professional engineering corporations (PCs) and professional limited liability corporations (PLLCs) to licensed professionals. The proposed legislation - introduced by Senator LaValle (S.2987) and Assemblyman Canestrari (A. 4581) - would amend the law by allowing a less than 25% share of ownership in engineering firms by non-licensed personnel. Promoting business New York engineering firms currently have a disadvantage in the region when it comes to attracting new and existing talent. In comparison to its neighbors, Vermont has the next highest licensed ownership requirement at a simple majority of 51%. By expanding ownership capabilities beyond licensed professionals, this legislation would allow all employees to invest back into their companies, boost hiring, increase motivation and positively impact business in the state. Additionally, because the restrictive ownership policy was not enacted until 1935, long-established "grandfathered" firms enjoy full flexibility in ownership requirements. The proposed new legislation would level the playing field by giving newer, smaller engineering firms and DM/WBE companies the opportunity to recruit top-level talent and create new jobs. Safeguards ensure professionalism This bill incorporates public protection safeguards to ensure no breach in professional ethics occurs, including: * A minimum of 75% of firm ownership remains in the control of licensed professionals. * The ownership percentage of a non-licensed professional is limited to that of the highest licensed professional in a given firm. * A minimum of 75% of board of director seats are restricted to licensed professionals. * The president, chief executive officer, and chairman of the board of directors must be licensed professionals. Amending the existing, overly restrictive ownership policy will help New York firms to better compete - and even prosper - in today's global marketplace.