Plan Sheets + Red Lines – October 2019

Women and Men

An engineering company that contracts with the federal government is in hot water. In a fraud suit filed by the United States, the defendant company is accused of presenting itself as a Woman Owned Small Business when in fact men were running the show.

The company allegedly hauled in as much as $15 million in contracts directly from the government, or through working as a subcontractor on government jobs, from 2003 to 2015.  Originally filed in US District Court for the Central District of California, the case has since been moved to the Southern District, where the defendants live and work.

According to the suit, neither of the women propped up as the bosses “were in control of the long-term decision making and the day-to-day management administration” of the company. Here’s the catch. According to the suit, when the company’s brass got wind of the investigation, the company “attempted to cover up its misrepresentations.” The company’s then-CEO, who was male, “abruptly retired from his position in late 2015,” and from that point on, the company changed its description “to indicate it was no longer a WOSB.” Instead, the company described itself as “Small Business Woman Owned,” a designation that does not exist as it pertains to federal contract preferences. Moreover, the company elevated two women to the business’ top spots – CEO and COO – when investigators started sniffing around.

But the female CEO, according to the suit, “did not have any technical background in Navy programs, NTDS, or prior experience with federal government contracting.” The female COO, meanwhile, is described as a “former file clerk.”

The whole ruse, according to the suit, was concocted because the defendants believed that “WOSB status provided a competitive advantage in obtaining these lucrative contracts and subcontracts.” The WOSB designation is in place to provide a level playing field for women-owned businesses by limiting competition for certain contracts.

The defendant firm and its management team deny the allegations, and in one defense describe the suit as “clearly frivolous, clearly vexatious, or brought primarily for purposes of harassment.”

The owners of the company are husband and wife, and both of them allegedly juggled job titles when investigators got involved. We can only imagine the conversations they’re having around the kitchen table.

To New York

New York state has passed an aggressive climate bill aimed at all but eliminating the state’s greenhouse gas emissions by 2050. Hailed as one of the most ambitious pieces of environmental legislation in the world, the New York model would trade in fossil fuels for renewables, and do so on a grand scale, as the state is home to about 19.5 million people. The state plan is in addition to what’s going on in New York City, which is pushing for more energy-efficient skyscrapers.

The sprawling backdrop to all of this is twofold: less than a quarter of the state’s electricity currently comes from renewables; and in New York City, the Indian Point nuclear power plant, which supplies the city with about 25 percent of its electricity, is supposed to be shuttered in the next couple of years. In a nutshell, New York has a lot of work to do in a short amount of time if it wants to meet its goals. And it’s going to cost billions upon billions of dollars.

But, as always, out of chaos and crisis comes opportunity. Think about it. The market in renewables should enjoy an extended boom in the Empire State, and that boom will be powered by the engineering and tech industries. If you’re a young scientist or computer whiz, or a widget maker or an engineer in wind, water or solar, New York probably is, and probably will be, the place to hang your hat.

The environmental effort in New York is already underway, of course, and the competition, as it’s always been, is fierce. But the opportunity there is being measured in decades and in billions, so there’s probably enough innovation to go around. We can only imagine the tussle that’s up ahead. The lawsuits and heartache, the politics and permitting, the trial and error, the taxes and expenses, and the overall grind of transforming the sprawling, antiquated energy grid of the state and its teeming namesake city. But it’s the Big Apple, the home of turmoil. It could be no other way. If you’re a scientist or engineer looking to make your name, or at least your career, go to New York, and don’t forget to bring your coat!

If you know of an interesting or off-kilter story taking place in the AEC industry, please contact C+S at rmassey@zweiggroup.com.