Second Thoughts: Surveying Fees-Revisited
Professional Surveyor Magazine - February 2004
Wilhelm A. Schmidt, PLS
If we talk among ourselves about fees, we may be charged with collusion. But nothing prevents us from talking about the days when professionals did openly set fees.
Some time ago, a colleague of mine, Dave Widmer, sent me a schedule of "Minimum Fees for Surveying Services," published in 1958 by a chapter of the Pennsylvania Society of Professional Engineers. The Pennsylvania Society of Land Surveyors did not yet exist, and engineers were then offering surveying services. The PSPE therefore published this schedule in addition to its schedule of fees for engineering services.
I had seen this particular fee schedule before, and knew about others like it. The late fifties were rife with attempts to standardize professional fees. The most comprehensive of these attempts is a chart of fees from all states, published by the ACSM in the June 1959 issue of Surveying and Mapping.
These schedules, of course, predate federal anti-trust challenges to national professional societies (cf. "Ethics and Free Trade,"Professional Surveyor, May 1999, p. 42). All the more reason to be clear about their intent! The PSPE publication notes that the surveying fees are "suggested minimums for localities in the state where average conditions of employment prevail". The rates apply to "local work which can be conducted from the surveyor's regular business and which is within commuting range of that office." The ACSM chart is similarly cautious. It is entitled "Fees & Salaries Study." The article that accompanies the chart refers to the numbers as representative. It lists states that have fee schedules (Pennsylvania, curiously, not among them), but notes that these schedules reflect individual practice. There was obviously no outright intent to fix prices at either the state or the national level.
The schedules can, nevertheless, be interpreted that way. At least part of the motivation was to give surveyors the upper hand in the pricing of their services. The article just mentioned states that do certain types of surveys, particularly mortgage surveys, are "done on a highly competitive basis which constantly forces fees down." The problem is not the competition for that kind of work, but the presumption of those ordering the surveys that they can set the price, mostly one that is ludicrously low. When that happens, we are put in a no-win situation: work for less, while assuming more liability, or give up the work entirely. A published schedule of fees would give notice to parties ordering surveys of their fair cost. The problem is that even such a defensive posture is now considered illegal. It is exactly the situation for which Arkansas surveyors were reprimanded (cf. Dennis Mouland's Ethics for the Professional Surveyor, chapter 11). As things now stand, each of us individually has to have the guts to stand up to unreasonable price setting.
An examination of the schedules themselves reveals that pricing practices have remained much the same over the years. The PSPE schedule first addresses lump sum bids. It discourages such bids because the "varying nature and dissimilarity of Survey Work make it impossible to accurately determine beforehand the amount of work a survey will require." It suggests that the work be done "on a per diem or cost plus basis," and that the fee be arrived at by adding 100% of those charges as well as other direct expenses to the direct payroll charges. The ACSM article provides some background and analysis of this practice. The formula was originally proposed by the ACSM in 1949 in a document entitled "Equitable Fees for Property Surveys." The article notes that the ratio should be about 2.3 times field salary expense, to cover the salaries of office personnel. The ratio should be further increased to reflect current payroll and business taxes. The article also reported that 75 %of those participating in the study "did not use adequate cost accounting systems."
Same Service for Less
The article further discusses a factor that tends to depress that ratio (perhaps less now than then): the offering of surveying services by employees of public agencies on their own time. With a regular income, and without the overhead of a full-time practitioner, they can afford to provide the same service for less. The article does not say, but often these part-timers are held in higher regard than full-time surveyors because they are publicly employed. My own experience is that they are usually pressed for time, and the quality of their work suffers. Even if their work complies with standard practice, they are often not available when they are most needed. The article suggests that their conduct is unethical, but that, without a fee schedule, they cannot be admonished.
The PSPE fee schedule notes another practice worth mentioning, namely, that of charging a proportionately higher rate for work done in a fraction of a day. Regarding fieldwork: "There should be a minimum charge of 60% of the full day for a half day or less." Regarding office work: "There should be a minimum charge of 33-1/3% of the full day charge for a quarter of a day or less." The suggested rate for "court work or for legal proceedings" is one and one-half times regular rates, but preparation for it just the regular rate.
While pricing practices may not have changed in the last four decades, rates have—drastically! Without publishing any of the schedules, the rates can still be compared. The current minimum wage for unskilled labor is higher than the hourly wage for a licensed surveyor was in 1958. Current salaries are about ten times those suggested then. The increase is attributable to inflation. But relative to each other, salaries have remained the same, those of a "surveyor or party leader" being almost double that of an "assistant:" and consultation provided by principals of a firm is still deemed to be worth more than their standard rate.
Coincidentally, 1958 was the year in which I landed my first summer job as a rodman. I was paid a dollar an hour. That was less than the rate suggested in the fee schedule in my employer's possession. Had I only known!
About the Author
Wilhelm A. Schmidt, PLSWilhelm Schmidt is the former owner of the surveying firm Bascom and Sieger in Allentown, Pennsylvania. You may contact him at firstname.lastname@example.org.
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