TZL 1559 (web)

October 28, 2024, Issue 1559 WWW.ZWEIGGROUP.COM

TRENDLINES

Parental leave (in weeks)

0 1 2 3 4 5 6 7

Firms that adopt these competitive strategies will be better positioned to achieve sustained success. A guide for success

Zweig Group’s 2024 Recruitment & Retention Report shows that AEC firms are evolving their parental leave policies, with an overall average of 3.9 weeks of leave offered to new parents. Maternity leave averages 6.1 weeks, while paternity leave is typically shorter, averaging 3.5 weeks. Participate in a survey and save 50 percent on the final or pre- publication price of any Zweig Group research publication.

I n the AEC industry, creating an exceptional workplace environment is not just about offering competitive salaries or attractive benefits. It’s about cultivating a culture that resonates with employees, fostering growth, and recognizing achievements. For the first time, Zweig Group has produced a report, A Guide for Success , that examines what the top firms in the Best Firms To Work For program are doing to set themselves apart. By examining these strategies, we can uncover what helps these firms stand out and provide a guide for other organizations aiming to enhance their own workplace environments. Here are the unique strategies these firms employ across six key areas: 1. Culture: The cornerstone of employee satisfaction. Company culture is increasingly recognized as a vital component in attracting and retaining talent in today’s competitive job market. According to the Zweig Group’s survey, 36.5 percent of employees identify culture as the most critical factor in their work experience. The top firms distinguish themselves by fostering a culture of transparency and open communication. Practices like open-book management – where financial data is shared with all employees – are common among these firms. This transparency builds trust, empowers employees to contribute meaningfully, and fosters a sense of ownership and engagement. By prioritizing these cultural elements, the top firms create an environment where employees feel valued and connected to the company’s mission. 2. Compensation: Beyond salaries to incentives. Compensation remains a crucial factor for job satisfaction, with 31 percent of survey respondents citing it as the most important aspect of their work experience. While there is no stark contrast in base salaries between the top 10 firms and other recognized companies, the difference lies in the variety and structure of bonuses offered. Top firms implement a range of bonus plans, such as referral, performance, and project bonuses, which not only incentivize high performance but also foster a culture of recognition and appreciation. These firms invest heavily in bonus payouts, reflecting a commitment to rewarding excellence and aligning employees’ efforts with the company’s objectives. 3. Benefits: Adapting to modern workforce needs. Employee benefits are a critical component of total compensation packages,

Kyle Ahern

FIRM INDEX AECOM..........................................................................4

A. Morton Thomas and Associates..........6

Balfour Beatty US.................................................6

Cushing Terrell........................................................9

ISG.....................................................................................4

MORE ARTICLES n LYNN BRUNS: Taking the lead Page 4 n MARK ZWEIG: What’s so great about ElevateAEC? Page 7 n JOSH HERSEL: A cooperative approach Page 9 n RACHEL LINDBLADE: Green building cash incentives Page 11

See KYLE AHERN, page 2

THE VOICE OF REASON FOR THE AEC INDUSTRY

KYLE AHERN, from page 1

particularly in an industry like AEC, where competition for skilled professionals is fierce. The top firms are leading the way in providing comprehensive benefits that go beyond traditional offerings. Health and wellness programs, flexible work arrangements, and professional development opportunities are standard among these top performers. Additionally, they offer innovative benefits like childcare support and extended parental leave, addressing specific needs of their workforce and enhancing the overall employee experience. By doing so, they not only attract top talent but also improve retention rates by demonstrating a genuine commitment to employee well-being. 4. Recruitment and retention: Innovative strategies for talent management. The AEC industry faces significant challenges in recruitment and retention due to a limited pool of qualified candidates. The top firms excel by adopting innovative strategies, such as robust mentoring programs, strategic pay increases, and extensive training opportunities. These practices ensure that employees are continuously developing their skills and feel supported in their career growth. By fostering a culture of continuous learning and offering competitive compensation packages, these firms not only attract new talent but also retain existing employees, ensuring sustained growth and success. 5. Professional development: A commitment to continuous learning. Professional development is the most requested benefit among employees in the AEC industry, and the top firms recognize its importance. These firms are committed to offering extensive professional development opportunities, including formal training sessions, certification courses, and workshops. By investing in their employees’ growth, the top firms demonstrate that they value their workforce not just for their current contributions but for their potential to grow and advance within the organization. This focus on continuous learning helps maintain a competitive edge in the industry and fosters a motivated, loyal workforce. 6. Performance management and recognition: Rewarding excellence. Effective performance management and recognition are critical to fostering a motivated and high-performing workforce. The top firms prioritize merit-based recognition, ensuring that employees who demonstrate exceptional skills and dedication are acknowledged and rewarded. They implement comprehensive recognition programs that celebrate both individual and team achievements, ranging from formal awards to public acknowledgments and experiential rewards. By recognizing and rewarding excellence, these firms build a positive and motivating workplace culture where employees feel valued and appreciated. The practices and policies of the top 10 Best Firms To Work For recognized in A Guide For Success provide valuable insights into what makes a great workplace. By prioritizing transparency, offering comprehensive benefits, investing in professional development, and recognizing employee achievements, these firms create environments that not only attract talent but also foster loyalty and engagement. As the AEC industry continues to evolve, firms that adopt similar strategies will be better positioned to achieve sustained success and recognition. To get a full understanding of what these top firms are doing to set themselves apart, check out Zweig Group’s A Guide For Success: Insights from the 2024’s Top 10 Best Firms To Work For . Kyle Ahern is an employee experience and data strategist at Zweig Group. Contact him at kahern@zweiggroup.com.

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Chad Clinehens | Publisher cclinehens@zweiggroup.com Sara Parkman | Senior Editor & Designer sparkman@zweiggroup.com Tel: 800.466.6275 Email: info@zweiggroup.com Online: zweiggroup.com/blogs/news LinkedIn: linkedin.com/company/22522 Instagram: instagram.com/zweiggroup Twitter: twitter.com/ZweigGroup Facebook: facebook.com/p/Zweig- Group-100064113750086 Published continuously since 1992 by Zweig Group, Fayetteville, Arkansas, USA. ISSN 1068-1310. Issued weekly (48 issues/year). © Copyright 2024, Zweig Group. All rights reserved.

A GUIDE FOR SUCCESS: INSIGHTS FROM 2024’S TOP 10 BEST FIRMS TO WORK FOR This comprehensive report explores the strategies that define the employee experience of the top 10 Best Firms To Work For in the AEC industry. Drawing from the data of the 2024 Best Firms to Work For, we highlight the standout practices that set these companies apart. Click here to learn more!

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

OPINION

Taking the lead

I n today’s dynamic business landscape, strategic investment in leadership development is crucial for accelerating business goals, increasing profitability, and improving recruitment and retention. Research consistently supports the benefits of nurturing leadership within an organization. Strategic investment in leadership development is crucial for accelerating business goals, increasing profitability, and improving recruitment and retention.

Lynn Bruns, PE

According to the Center for Creative Leadership, companies with robust leadership programs respond better to business changes, with 86 percent of such companies navigating change successfully compared to 52 percent of those with less mature programs. Leadership development is a magnet for high performers, boosting employee retention by up to 20 times, particularly among millennials and Gen Z, who value personal growth and career progression. Essential skills like critical thinking, problem solving, active listening, and accepting feedback improve professional performance, making individuals more self-aware, resilient, and adaptable. COMBATING THE CHAOS CURVE. Every organization faces the “chaos curve,” which is the discrepancy between true leaders and simple headcounts.

This chaos can derail momentum and halt growth, creating inefficiencies and frustrations. To combat this chaos, companies can focus resources into the right areas, such as:

Culture and talent management. Hire, fire, and promote the right people, and address underperformance swiftly to maintain a healthy culture. Leadership opportunities. Ensure a robust pipeline of leaders ready to step into roles. Increase the number of employees who “get it” and align with the company’s vision.

■

■ Professional development. Invest in professional development to improve the client experience and project delivery and enhance the employee experience, recruitment, and retention efforts.

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

BUSINESS NEWS AECOM AWARDED CONTRACT FROM THE U.S. ARMY ENVIRONMENTAL COMMAND FOR ENVIRONMENTAL REMEDIATION SERVICES AECOM, the world’s trusted infrastructure consulting firm, announced that it has been awarded a five-year, multiple-award contract from the U.S. Army Environmental Command to provide environmental remediation services, including investigation and remediation services for per- and polyfluoroalkyl substances, at various locations throughout the contiguous United States, Puerto Rico, Hawaii, and Alaska. “We are proud to continue leveraging our leading environmental expertise in partnership with the U.S. Army on their environmental remediation challenges

across the U.S.,” said Frank Sweet, chief executive of AECOM’s global Environment business. “Importantly, we now hold a series of key environmental remediation contracts across our U.S. government clients, including for the U.S. Army, Navy, FEMA and NASA, which positions us well to support our clients on the regulatory demands for emerging constituents like PFAS.” AECOM’s scope encompasses the investigation and remediation hazardous and toxic waste throughout the United States, including persistent compounds such as PFAS. With more than two decades of PFAS experience at more than 600 sites globally, AECOM is uniquely suited to support the U.S. Department of Defense PFAS responses.

“The remediation of PFAS is not just an environmental challenge – but one related to protection of water as a resource,” said Beverley Stinson, chief executive of AECOM’s global Water business. “As the number one Water design practice as ranked by Engineering News-Record, we look forward to supporting the U.S. Army through this contract and continuing our work with federal agencies to protect human health, the environment and our water supply.” AECOM is the world’s trusted infrastructure consulting firm, delivering professional services throughout the project lifecycle – from advisory, planning, design and engineering to program and construction management.

START WITH IDENTIFYING WHERE YOU’RE GOING AND WHY. In 2023, ISG launched a five-year growth plan, identifying opportunities for client, talent, and geographic expansion. Every company’s goals are going to be different. The important thing is that employees are working from a common vision – rowing in the same direction – even if leaders take a different approach to get there. ISG is taking the coach approach to leadership development to achieve our strategic goals. THE COACH APPROACH. There is a difference between a coach and mentor. One of Google’s studies, known as Project Oxygen, revealed that high-quality managers who excel in coaching and communication tend to have more engaged and productive teams. Google identified that their best managers share specific behaviors, such as being good coaches, empowering teams, and fostering an inclusive environment. ISG has experienced the benefits of hiring in-house performance strategists. Leading our effort is Dave Williams who is trained in sports psychology. Dave and his team apply similar coaching techniques to enhance the skills, behaviors, and effectiveness of leaders within the firm. This method emphasizes personalized, one-on-one interactions where performance strategists guide leaders through a process of self-discovery, goal-setting, and action planning. If your company does not have the internal resources to hire directly, there are many coaching resources and consultants available externally for you to consider. THE LEADERSHIP DEVELOPMENT RIPPLE EFFECT. Over the last eight months, ISG has piloted a leadership program that is designed to fast-track leadership skills of select employee owners through coaching, assessments, and team-building activities. Participants were selected based on their broad influence, creating ripple effects that will benefit all employee owners and improve overall leadership capabilities. The impact of this program and its success is already evident through the positive testimonials from the pilot cohort and excitement it has created firmwide.

ONE SIZE DOES NOT FIT ALL. Using your vision plan, work backward from your goals to identify the behaviors you need to implement today to achieve the results you desire tomorrow. Develop leadership programs around this approach, ensuring there are opportunities at every milestone to keep individuals engaged and growing as leaders throughout their careers. This method fosters continuous development, aligning daily actions with long-term success. We have also seen success in engaging young leaders early in their careers through client interactions, industry committees, and public engagement opportunities. This early engagement positively impacts retention and makes ISG known within the AEC industry as a firm that invests in young talent. This is a competitive advantage in a challenging recruitment industry. Conversely, leveraging the experience of our seasoned professionals helps to minimize the chaos curve and maintain growth momentum. THE INVESTMENT IS WORTH THE RETURN. We get it. The investment in leadership development is real, but so is the return. In the last five years, we have increased our staffing levels by 42 percent, expanded our office locations from 10 to 14, and increased profitability by 34.8 percent. Refining and expanding our leadership development programs has led to our lowest turnover rate in four years, demonstrating the effectiveness of these initiatives. By aligning our business goals with our leadership goals, we are building a high-performing firm that leverages the strengths of our team and amplifies the culture of employee ownership. Leadership development is not just an investment in your leaders; it is an investment in the future success of your organization. Lynn Bruns, PE is chief executive officer of ISG. Connect with him on LinkedIn.

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

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THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

FROM THE FOUNDER

L ate last month, I got to go to Zweig Group’s annual ElevateAEC Conference & Awards Gala in Tampa. It was very well-attended and the first conference I had been to in probably five years – and it was great to be back. The ElevateAEC Conference in Tampa energized attendees, fostered invaluable connections, and showcased industry potential and success. What’s so great about ElevateAEC?

Here are a few of my thoughts and observations on the event: 1. The energy of the attendees, and the energy of the whole event is infectious. It’s really something when you put hundreds of optimistic winners from one industry in a room together. It really changes your whole attitude and perspective on what is possible. That’s what we had at ElevateAEC. And that isn’t the way I feel at most industry gatherings, too often full of complaining and negativity that sucks my energy versus increasing it. 2. The connections between attendees made (and remade) are invaluable. I overheard a number of conversations about potential combinations of two or more firms by the CEOs/founders there. That is really cool. Where else can you witness

that? One firm there had acquired 20-something companies. The possibilities that can come out of these conversations are exciting. I also reconnected with some of my old friends at the event and one even drafted me back to their BOD. 3. The sponsors and exhibitors I spoke with all recognized the energy and potential of the group. Each of them I talked to were surprised at how engaged the attendees were and how interested they were in what the sponsor was doing for the industry to help it out. That was a really good feeling as we want sponsors to feel their time and monetary investment to do something like this is worth it. From my own experience, that isn’t always the case!

Mark Zweig

See MARK ZWEIG, page 8

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

ON THE MOVE BALFOUR BEATTY HIRES WILLIAM WEBB AS GENERAL MANAGER OF TOTAL POWER GROUP OPERATIONS Balfour Beatty US has announced the hiring of William “Billy” Webb as general manager of its Total Power Group operations based in Greensboro, North Carolina. Billy succeeds former general manager Kevin Miller, where he will be responsible for leading the TPG team in providing traction electrification solutions for transit systems as well as efficient energy system solutions for aviation and mission critical facilities across the U.S. “We are thrilled to welcome Billy to our team of traction power experts serving rail, aviation and mission critical projects across the nation,” said Mark Konchar, Balfour Beatty US Civils president and managing director of Rail operations. “He is the perfect fit to lead our more than 60 TPG teammates through his extensive experience in providing power generation and electrification services to critical market sectors in our industry. I look forward to witnessing Billy’s leadership and our company’s continued success in meeting our clients’ traction power needs in our various geographies.” Webb boasts more than 35 years of experience in the power generation and electrical field, including the sale, service, maintenance and installation of emergency power distribution

equipment, fire pumps and fuel and control systems. Prior to joining Balfour Beatty, Webb served as president of a nationwide commercial and industrial emissions testing business. In his role, he managed contracts with manufacturing plants, hospitals, data centers, governmental facilities as well as both residential and commercial buildings. Webb is a U.S. veteran who served in the Navy as an Electrician’s Mate Petty Officer Second Class aboard the USS Thomas C. Hart. He is also passionate about raising awareness for and participating in events that support the March of Dimes and the American Cancer Society. Balfour Beatty is an industry-leading provider of general contracting, at-risk construction management and design- build services for public and private sector clients across the United States. Headquartered in Dallas, Texas, the company performs heavy civil, rail and a broad variety of vertical construction in select local geographies. CHELSEA BISHOP PROMOTED TO ASSOCIATE AT A. MORTON THOMAS AND ASSOCIATES, INC. A. Morton Thomas and Associates, Inc. has announced that Chelsea Bishop has been promoted to an associate with the firm.

Bishop serves as group leader in AMT’s Herndon, Virginia, office where she leads the Northern Virginia Site & Infrastructure group in management of multiple on-call contracts and stand- alone projects for clients in northern Virginia and in Washington, D.C. with a large focus on Parks and Recreation and municipal facility projects. Her expertise is in managing and providing civil engineering, permitting, and construction administration services for municipal and private clients which has resulted in multiple repeat clients and on-call contracts leading to expansion of client service in northern Virginia. She received her bachelor’s degree in civil engineering from the Virginia Polytechnic Institute and State University in 2007 and has more than 16 years of experience, including 12 with AMT. Bishop is an active member in the American Council of Engineering Companies Metropolitan Washington Virginia Municipal Committee and is a Professional Engineer in the District of Columbia, Virginia, and Maryland. AMT has a deep appreciation for establishing vision and achieving goals. Client-focused since the firm’s 1955 inception, AMT has evolved into a multidisciplinary engineering and design consultancy with more than 20 offices throughout the eastern United States.

in San Antonio, Texas. I encourage you to bring as many people as you want to be as inspired and energized as possible. It will be well worth it! Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com. “It’s really something when you put hundreds of optimistic winners from one industry in a room together. It really changes your whole attitude and perspective on what is possible.”

MARK ZWEIG, from page 7

4. I was incredibly proud of the entire job done by my successors. The programming, the venue, the food, the AV, and the lighting were spectacular, and on a level unlike any conference for this industry I have ever attended. I had zero involvement in planning this thing and they did an amazing job that made me very proud. In short, instead of leaving the event deflated and worried about everything I missed back home while I was there, I left feeling invigorated and reengaged with this amazing industry I have spent my entire career working in. Next year, the whole event is going to be held on the Riverwalk

2025 ELEVATEAEC CONFERENCE & AWARDS GALA The ElevateAEC Conference is the largest in-person gathering of industry leaders and award-winning firms, all interested in advancing the “elevate the industry” vision.This year’s conference promises to be bigger and better than ever, with a jam-packed agenda designed to help you network, learn, and celebrate like never before. Registration is open for the annual in-person conference. Join us in San Antonio, Texas. Click here to learn more!

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

OPINION

A cooperative approach

The integrated project delivery method fosters early collaboration, minimizing surprises and enhancing efficiency at the core of your business.

W e all want a smooth and efficient project process, whether you’re leading a design team or are a developer, owner, project partner, or construction contractor. One way we’ve found to preempt issues is by utilizing the integrated design project delivery method, which establishes early and frequent communication and collaboration.

Josh Hersel

Predictability isn’t a given in the AEC world. Designers, engineers, and general contractors gather estimates, build schedules, and procure materials to gain as much certainty as they can before a project launches. Countless factors can derail even the most detailed plans, however. Supply chain issues, labor availability, and even pandemics can throw plans into disarray. With design-bid-build, sometimes referred to as a traditional delivery method, a project unfolds in three distinct, sequenced phases with separate contracts for each. In design-build, the project owner has a single point of contact, and one contract covers design and construction. Design and construction parties work together from the beginning.

Integrated design takes design-build a step further, bringing all responsible parties to the table at project initiation. The parties stay involved and participate in every phase of the construction process. Rather than each project phase occurring consecutively, sequencing happens simultaneously because all parties, from the general contractor to trades, are involved at every step. This method can minimize surprises, increase efficiencies, and spur innovative ideas along the way, because each discipline validates the methods and decisions as the project unfolds. Our staff say it provides a system of checks and balances that

See JOSH HERSEL, page 10

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

bringing the building into the 21st century in terms of comfort, safety, security, and accessibility. The project added a rooftop deck and reopened previously closed off street-level access. The ground floor now encompasses a coffee shop, bodega, restaurant, and salon, and it provides cohesion throughout the “micro” neighborhoods along Main Street. The award-winning project is a great example of successful integrated design. The project was delivered on time and on budget, as the integrated project delivery method caught potential issues early on, mitigating risk of change-orders. It also led to a deepened relationship with the construction partner and additional projects with them, including their own offices. Whatever the project delivery method, it’s critical the people involved know their business and work well together. At Cushing Terrell, not only have we embraced a multi- disciplinary service offering, but we’ve also successfully partnered with builders for years by working together proactively from the very onset of any project. Building those relationships and establishing trust with project partners is key to establishing trust and confidence in your clients, realizing successful projects, and earning subsequent work. Josh Hersel is an associate principal at Cushing Terrell and leads the firm’s multi-family residential and mixed-use development projects. Connect with him on LinkedIn.

JOSH HERSEL, from page 9

yields cost savings because issues are caught early on. Having contractors and subcontractors look at designs as they’re developed means they have input on drawings when it has the most impact – before construction begins. “This method can minimize surprises, increase efficiencies, and spur innovative ideas along the way, because each discipline validates the methods and decisions as the project unfolds.” With contractors and subcontractors at the table, they can review the architecture, codes, life and safety aspects, and building materials. A framer’s input, for example, can identify a better nail, strapping, or wood type to minimize change orders or help control long lead times by choosing different materials. In Boise, Andersen Construction and Cushing Terrell partnered on the 10th and Main historic renovation project. The project included a full replacement of mechanical and electrical systems, as well as a new elevator and life safety provisions,

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

OPINION

Green building cash incentives

Discover how sustainable building design can drive significant cost savings in 2024 and beyond.

A s the world confronts the urgent challenges posed by climate change and rising energy costs, businesses are increasingly seeking sustainable solutions to enhance operational efficiency. Among the available strategies, the section 179D deduction emerges as a critical financial incentive for investing in energy-efficient improvements to commercial buildings. This provision of the Internal Revenue Code not only promotes sustainable practices but also delivers substantial tax savings, enabling organizations to offset costs associated with upgrading to greener technologies.

Rachel Lindblade

The United States is actively addressing climate change through significant measures to reduce greenhouse gas emissions and promote sustainable practices. One of the most impactful initiatives is the Inflation Reduction Act, which provides substantial tax incentives for clean energy investments. This legislation supports renewable energy tax credits, as well as investment deductions for efficiency improvements, encouraging both businesses and consumers to adopt greener technologies. WHY IS 179D A GREAT INCENTIVE TO PROMOTE GREEN BUILDINGS? The IRA significantly enhances clean energy investment and mitigates climate change through improved tax incentives. A standout

feature of this legislation is the expansion of IRC section 179D, which provides tax deductions for energy-efficient improvements in commercial buildings. The core principle of Section 179D is to incentivize investment in energy-efficient technologies and design, mainly in the Building Envelope and Systems (HVAC and lighting) design, thereby promoting resource efficiency and sustainability. With the IRA, the deduction allows commercial property owners and design professionals to deduct up to $5.36 per square foot in 2023, and up to $5.65 for 2024 for qualifying energy-efficient upgrades,

See RACHEL LINDBLADE, page 12

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

began before January 29, 2023. Future projects will need to meet these requirements to maximize the deduction benefits. ■ Energy efficiency standards. The qualification criteria for energy efficiency improvements are currently based on the 2007 ASHRAE standards, which are relatively easy to meet for new construction and renovations. However, after the 2026 tax year, the standards will shift to the 2019 ASHRAE guidelines, making it more challenging to qualify for the full deduction amount. Claiming the section 179D deduction involves several key steps. First, businesses need to identify eligible projects with qualifying improvements that meet the deduction criteria. Next, they must obtain necessary certifications from qualified professionals to confirm compliance with energy savings standards. Additionally, businesses must gather documentation demonstrating compliance and report it to tax form 7205. Rachel Lindblade is a technical manager in the A&E division of EPSA USA. Contact her at rlindblade@epsa.com.

RACHEL LINDBLADE, from page 11

a significant increase from the maximum $1.88 per square foot in 2022. This significant financial incentive encourages businesses to make capital investments that reduce energy consumption. Notably, the IRA has made it easier for businesses to qualify by lowering the required increase in energy efficiency from 50 percent to just 25 percent of the 2007 standards of the American Society of Heating, Refrigeration, and Air-Conditioning Engineers. This shift aims to broaden participation and drive a larger number of commercial building upgrades, effectively aligning financial incentives with essential environmental goals. Furthermore, the deduction’s structure facilitates immediate tax savings, which is increasingly vital as businesses face rising operational costs and fluctuating energy prices. By offsetting the initial costs of adopting energy-efficient technologies, the section 179D deduction plays a crucial role in supporting businesses in their quest for sustainability while also contributing to a greener economy. HOW CAN AEC FIRMS BENEFIT FROM THE 179D DEDUCTION? AEC firms stand to gain significantly from the section 179D deduction, particularly when involved in the design and construction of energy-efficient buildings. Notably, the revised legislation allows tax-exempt entities (government, higher education, K-12, religious, non-profits, etc.) to allocate the deduction to the primary designer responsible for energy- efficient improvements, unlocking previously inaccessible benefits to architecture and engineering firms. For-profit building owners who invest in qualifying energy- efficient upgrades can also claim the deduction, provided they meet specific criteria. The financial implications can be substantial. This tax incentive not only supports the immediate economic health of firms but also enhances their competitive edge in the growing market for sustainable building solutions. By integrating energy-efficient designs into their projects, firms can not only improve their bottom line but also demonstrate a commitment to sustainability. This proactive approach can attract environmentally conscious clients, further differentiating these firms in a competitive landscape. WHY IS NOW THE RIGHT TIME TO EXPLORE THIS OPPORTUNITY? With building owners and organizations facing increasing operational and construction costs and spikes in taxes due to 174 amortization requirements, AEC firms should strongly consider the 179D deduction this year. Here are key points to note: ■ Increased deduction amount. The deduction amount has nearly tripled for 2023 and 2024 compared to previous years. Smaller projects, previously deemed not worth the effort, should now be reconsidered for this deduction. could allocate this deduction. Now, in 2023 and 2024, nonprofit organizations can also benefit. This expansion allows AEC firms to leverage the deduction for a wider range of projects, including schools, higher education institutions, religious institutions, and affordable housing. ■ Expanded eligibility. Previously, only government buildings ■ Waived PW&A requirements. Prevailing Wage and Apprenticeship requirements are waived for projects that

THE ZWEIG LETTER OCTOBER 28, 2024, ISSUE 1559

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