May 2006

Matthew Mokanyk's [article] made me realize how important it is to occasionally, if not regularly, remind our younger peers of past (but still relevant) developments affecting our profession.

Mr. Mokanyk has experienced the frustrating eternal battle against low-bid inferior surveys. Older surveyors will remember the "good old days" 40-something years ago when surveying associations in many states were able to publish professional fee schedules. Most truly professional surveyors did adhere to the printed rates-and their code of ethics-and refused to bid. Unfortunately, all of that changed in 1975 with the infamous Goldfarb case. Attorney Goldfarb was looking for a house in the Washington, D.C., area. He became very angry when he discovered that every one of the 37 real estate lawyers he called quoted the same legal fees for closing the deal. He sued the local bar association for price fixing and went all the way to the U.S. Supreme Court. He won!

In June 1975, the Supreme Court handed down its decision (No. 74-70,Goldfarb v. Virginia State Bar et al). All professional fee schedules were considered "price fixing" and outlawed for restraint of trade. This ruling applied to all lawyers, engineers, architects, surveyors, medical doctors and accountants. Subsequently, the American Society of Civil Engineers paid a fortune to reverse that decision-in vain. The [Arkansas Society of Professional Surveyors] was fined $60,000 for violating the order. All state societies of land surveyors and engineers rescinded their prevailing annual fee schedules. Without "restraint," it became free for all"¦ buyer beware.

And here we are, 30 years later. Professionally minded surveyors continue to render a professional service for a professional fee. They will often lose out to the low bid. [They] will do a substandard job at a substandard fee and, more often than not, get away with it. Buyer beware-indeed!

No matter how much it hurts, we cannot conspire to circumvent and violate the U.S. Supreme Court ruling. For registered professional land surveyors to get together, formally or informally, and to recommend fees is collusion.

We know that ethical behavior can be taught at colleges and by example, but it cannot be legislated or ensured. If a registered/ licensed surveyor had to invest years and much money for his education and experience, he/she will value it highly. If state regulations make it too easy to become registered, we are asking for slipshod, short-cut, bottom-line, mediocre service from less than competent surveyors, and the public will be the loser. We can only do what is right and hope that others will too. And we should not be reluctant or afraid to report improper surveys to our boards of registration. Only we can weed out the inept among us.

Gunther Greulich, PLS, PE
Massachusetts


In a perfect world, our salaries would all reflect what we believe our value is. Land surveyors' compensation would be based on education, experience and reputation, and be comparable to lawyers, architects and other professionals. We wouldn't have to worry about the "$90 Mortgage Inspection Plat" or the surveyor down the road who is consistently less expensive than the majority of us. But alas, America in 2006 hasn't earned the "Utopia" label quite yet.

It is frustrating to hear about ridiculously cheap MIPs and [surveyors who are] continually underbid by competitors who don't seem to value their time or services. But we live in a market economy, and by definition, it is self-regulating. Ultimately, the amount of money we can charge for a survey is determined by how much the market will bear.

The market isn't willing to bear very much right now. The average American homeowner does not have a huge amount of disposable income, if any. A lot survey is a luxury item, not a necessity. When money is tight, luxury items are the first to go. If I am going to build a $500 fence on my suburban lot, why would I spend $800-$1,000 on a lot survey? If I get along with my neighbors and we agree, why bother paying for a survey?

If the market [dictates] that [the] value of a lot survey is $300, then [a homeowner] is not going to pay $800. If we want our business to survive, we have to either adapt to this reality, find a way to raise the market value of our services, or raise our profit margin.

Generally speaking, we seem to think that in order to be successful (i.e., make more money) we need to charge more. [We think] for some reason, if we don't charge what we believe we are worth, the public won't take us seriously. However, in smaller markets or highly competitive markets, this is not a viable option. There is no easy, quick answer to this dilemma. But there are things we can do that will help solve this problem over time.

First, we need to come to terms with the reality of the markets [in which] we work. I have often heard the argument that we need to charge more and work less with larger profit margins. That is all well and good when the economy is rolling along, but as things begin to slow down, that [argument] is no longer a viable solution. As money becomes scarcer, price will govern. People will be willing to wait to get their land surveyed if they can save a couple of hundred bucks. Reputation won't matter nearly as much, because as one realtor told me, "The cheap guy is just as liable as the expensive guy." Ouch.

Second, we need to educate the people in our community as to why our services are valuable (that is not the same as why they are expensive). We often talk about how Washington, Jefferson and Lincoln were surveyors and how we wish things were like that today, but how often are we willing to do the things that these men did? Ultimately, the profession of surveying is a public service and we need to treat is as such.

Last, as much as it irritates me to be underbid by the guy working out of his home office, he most likely has a much better understanding of what makes businesses successful than I do. The thing that allows him to be much cheaper than the rest [of] us, and yet maintain a higher profit margin is that he has a fraction of the overhead that medium and large firms have. And to be fair, that is a product of the abundance of work over the past decade. But as was said earlier, that is changing. There are two ways to increase your profits: you can either make more money or spend less. Unfortunately, we seem to always want to default to charging more.

There is no quick and easy way to improve the reputation of surveyors in general, and with that, justify larger fees in the public's mind. It can only happen gradually over time. But in the meantime, we need to take a careful look at our business practices and realize there are more ways to earn respect and make more money than just charging more.

Brad Wells
Oklahoma