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Surveying Business owned by other than Surveyor

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Surveying Business owned by other than Surveyor

Posted by Henry Purvis on Aug 31, 2010 11:31 am

I recently ran across a scenario where a surveyor has used his wife as CEO and Partner in the LLC they created for his surveying business. Then they turn around and advertise it as a "woman owned business" and probably received grants...etc. for being a minority business. Is this LEGAL?
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Re: Surveying Business owned by other than Surveyor

Posted by Don Poole on Aug 31, 2010 11:48 am

Not in my State, but this is a State specific issue


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Re: Surveying Business owned by other than Surveyor

Posted by Henry Purvis on Aug 31, 2010 11:51 am

Yeah, I'm gonna check it out for my state, I hope it is legal....
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Re: Surveying Business owned by other than Surveyor

Posted by Larry P on Aug 31, 2010 12:09 pm


My answer applies to and comes from my knowledge of North Carolina rules and regulations.  Your own state may be different.

This is an area that is often misunderstood.  The key to what regulations might (or might not) apply is the form of business ownership.

For a sole proprietor, the board does not regulate who can or can not own the business.  Should Mr. Purvis have such a business and pass away, there is nothing to prevent Mrs. Purvis from hiring a PLS to supervise the work while she owned the business.

Things get much murkier when you start forming corporations (of any flavor).  There are rules and regulations that apply to the ownership interest in corporations that provide professional surveying services.  In the same circumstance described above, if Mr. Purvis' company (a corporation) is to continue beyond his passing, Mrs. Purvis would have to sell a majority interest to someone who was licensed to provide the service.

Ah, but there is one kicker to the story.  There were a handful of corporations providing professional services in existence before these enactment of the regulations that dictated ownership interests.  My understanding is those companies are exempt from those rules.  As you might imagine the value of those companies is considerably different than the value of companies whose ownership is dictated by state regulations.

Larry P


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Re: Surveying Business owned by other than Surveyor

Posted by Mark Mayer on Aug 31, 2010 12:09 pm

I formerly worked for an engineering firm that had a fully staffed survey department, but none of the owners were surveyors. So I know it can be done. I'm not so sure about the MBE/WBE part. If it was easy everybody would be doing it. I know of a local engineering/surveying firm owned by a woman who isn't licensed at all, yet does plenty of WBE surveying work.
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Re: Surveying Business owned by other than Surveyor

Posted by Henry Purvis on Aug 31, 2010 12:20 pm

Well thanks for all your input but I found it........as long as one of the principal owners is a surveyor the other owners don't have to be. Cool....wish i'da thunk of that myself now......
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Re: Surveying Business owned by other than Surveyor

Posted by See Vayor on Aug 31, 2010 12:54 pm

Not to dispute Larry P but it is my understanding that no unlicesenced person can own more than 30% of a surveying business in NC.
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Re: Surveying Business owned by other than Surveyor

Posted by Sicilian Cowboy on Aug 31, 2010 1:05 pm


As stated above, this is a state to state issue.

Such a situation is legal in New Jersey, it is not legal in New York.
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Re: Surveying Business owned by other than Surveyor

Posted by Pin Cushion on Aug 31, 2010 1:45 pm


sure, why not? woman, black , mexican...chineese "minority".... whatever it takes
I will tell them I am a minorty owned business and dare someone to ask me if I am black... I would love to have that conversation.

OH, back on topic... anyone should be able to own a surveying company(or any company) as long the company has professionals to perform the work to standards, whatever they may be. If a Survyeing State Board tried to say I could not own a business then I garentee they have over stepped their bounds no matter if law or not in their regs... The company can call itself a mangment/coordiation/broker company and do fine, and damn near whatever they want... lot of people doing that in your , my, every state already.
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Re: Surveying Business owned by other than Surveyor

Posted by Rusty Chain on Aug 31, 2010 8:48 pm

The MBE/WBE certification isn't so that one could get "grants...etc.", but for preference points when competing for public works and other projects where government money funds all or portions of the project.

It's about the quotas.

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Re: Surveying Business owned by other than Surveyor

Posted by Mike Falk on Sep 1, 2010 9:24 am

... it is not legal in New York....


Angelo

How does that work for publically traded firms like Jacobs or AECOM?

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Re: Surveying Business owned by other than Surveyor

Posted by Burk Cornelius on Sep 1, 2010 12:56 pm

Pin Cushion:

OH, back on topic... anyone should be able to own a surveying company(or any company) as long the company has professionals to perform the work to standards, whatever they may be. If a Survyeing State Board tried to say I could not own a business then I garentee they have over stepped their bounds no matter if law or not in their regs... The company can call itself a mangment/coordiation/broker company and do fine, and damn near whatever they want... lot of people doing that in your , my, every state already.
I agree with PC, a State Board has no authority (in any state) to say who can or cannot own a company. That just doesn't make sense

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Re: Surveying Business owned by other than Surveyor

Posted by Tommy Young on Sep 1, 2010 3:10 pm

Mike Falk:

... it is not legal in New York....


Angelo

How does that work for publically traded firms like Jacobs or AECOM?


I want to know the same thing.
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Re: Surveying Business owned by other than Surveyor

Posted by Larry P on Sep 1, 2010 3:33 pm


I can't explain how it works in New York.  But for the details on how it works in North Carolina, you can see North Carolina General Statute 55B.

NCGS 55B

That link opens a pdf file with the statute.

The idea behind the law is the various licensing boards (surveyors, doctors, lawyers etc.) do not want non-licensed business owners to dictate professional decisions by employees who are licensed.

Notice that at no time did the General Assembly ask me what I thought about this or any other statute.  Many of our laws are not how they would be had I been asked to write them but that has nothing to do with whether or not I am expected to comply with them.

Larry P


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Re: Surveying Business owned by other than Surveyor

Posted by Sicilian Cowboy on Sep 1, 2010 4:02 pm


Corporations (and successor corporations) formed before April, 1935 may practice land surveying (or engineering) without an owner being an LS.

After that date, at least one "principal" or "officer" of the company must be licensed in the discipline in which the corporation wishes to practice.

In the case of such firms as Jacobs or AEC, they may come under the pre-1935 heading.

Or, there are many corporate categories, such as

"Domestic or foreign professional service corporations, professional service limited 
   liability  companies,  foreign  professional  service  limited liability
  companies,  registered  limited   liability   partnerships,   New   York
  registered  foreign  limited  liability  partnerships,  partnerships and
  joint enterprises......" 

under which they may be enabled under some other section of the Laws of New York State.


I do know that there have been many controversies, as Land Surveors and Engineers 
have tried to have their companies owned by their wives or mothers, in order to 
attempt to be classified as a "WBE". These efforts have been disallowed, unless the 
woman involved is also a licensed professional.

The intent is the same as Larry P states above.......they want to have the professional 
in charge of the business.

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Re: Surveying Business owned by other than Surveyor- upon review

Posted by Don Poole on Sep 1, 2010 4:21 pm

I think that I spoke to soon about Mass.
It appears that anyone can own the business, but must ahve a license holder in responsible charge.;...
 

"A person shall be construed to practice or to offer to practice land surveying who engages in land surveying, or who by verbal claim, sign, letterhead, card or in any other way represents himself to be a land surveyor, or through the use of some other title implies that he is a land surveyor, or who represents himself as able to perform, or who does perform any land surveying service or work, or any other service designated by the practitioner which is recognized as land surveying."

Therefore, it is the opinion of the Board that: For a firm, co-partnership, corporation, or joint stock association to be in compliance with the relevant provisions of MGL and the specific provisions of 250 CMR addressing Direct Supervision* and responsible-charge**, either its sole proprietor, principal or responsible-charge employee*** must hold a valid certificate of registration in the event that said firm, co-partnership, corporation, or joint stock association is:

  1. Practicing Engineering or Land Surveying as defined MGL;
  2. Representing by it's letterhead, yellow page listing or other form of advertising that it is providing Engineering or Land Surveying services;
  3. Employing people who are engaged in the preparation of work products that require the supervision, review and approval of a registered Professional Engineer or Professional Land Surveyor per MGL and 250 CMR.


Don Poole PLS
Outermost Land Survey, Inc.

"Outstanding in the field"
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Re: Surveying Business owned by other than Surveyor

Posted by Cee Gee on Sep 1, 2010 9:55 pm


I'm surprised at how few non-surveyor-owned survey firms there seem to be elsewhere, as they are not at all uncommon here in central Maine. One is owned by a soil scientist, as was another that I worked for briefly years ago; several are co-owned by non-licensees with varying degrees of expertise. As long as a licensee is in responsible charge there's no legal problem here -- truth be told there are excellent surveyors who could use a partner with some business acumen who can maybe hold a rod now and then.

As to the original post: is there any real evidence that grants and such are the primary motive for advertising as a woman-owned business? Perhaps it's just something they are proud of, or that they think may appeal to some prospective clients. No different from advertising "25 years of experience" or some other selling point.

For the record, there are, or at least were within recent years, at least three woman-owned survey firms in central Maine, the principals in all three being female licensees. Interestingly, female involvement in our field seems to be on the decline, but that's a different topic.


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Re: Surveying Business owned by other than Surveyor... LarryP NC?

Posted by Pin Cushion on Sep 1, 2010 11:43 pm

What does the NCBELS say about Survey Management/Broker/Coordination Companies?
What can they do to them for offering to practice, or procuring surveys?
Has the NCBELS been successful, in your opinion, of enforcing and/or stopping unlicensed or none C.O.A. entities that have no licensees or licenses in their structue?

... like I said above, anyone can own a business anywhere, including North Carolina
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Re: Surveying Business owned by other than Surveyor

Posted by Mike Falk on Sep 2, 2010 8:49 am

There are plenty of publicly traded companies or ESOP companies providing services in NC that don't follow the law as Larry reads it.

Maybe Larry could provide a citation?

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Re: Surveying Business owned by other than Surveyor

Posted by Larry P on Sep 2, 2010 10:38 am


For Mr. Cushion,

You ask:  Has the NCBELS been successful, in your opinion, of enforcing and/or stopping unlicensed or none C.O.A. entities that have no licensees or licenses in their structure?


I have not seen the actual paperwork.  But I can tell you that NC Surveyors were told that Bock and Clark were under a court order to cease and desist any and all operations in our fair state.  (I also understand that similar orders are in effect in many other states.)  While I do not follow the details of all the board activities, I do have occasion to speak to various persons who see a good deal of the board activity.  I can tell you that our board takes their responsibilities very seriously.  Among those responsibilities is the enforcement of the laws as written.  GS 55B is one of those laws.

For Mr. Falk,

You say:  Maybe Larry could provide a citation?

I thought that was exactly what I did previously when I posted a link to the applicable statute.  Note that the link to GS 55B is not my interpretation.  Exactly how ESOP companies handle their internal workings is something of which I have no knowledge.

Now, lest the discussion lose focus and becomes more academic in nature, let's return to the original question which was about ownership of companies that provide professional services.  I can tell you from personal knowledge of a local bank that wanted to provide "turn key" service for their customers.  They bought a real estate company, they bought an insurance company, they bought an appraisal company, and they were looking to buy a surveying company.  When I found out I went to a friend who happened to be one of the Vice Presidents.  I told him they could have my company and that I would be glad to work for them at no salary for the first 3 years.  Of course, according to the statute they would first have to give me 51% ownership of the bank.  As you might imagine, they quickly dropped the idea of providing surveying services.   I would have gladly taken the task of doing their work for a majority ownership of the bank.

Larry P


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Re: Surveying Business owned by other than Surveyor

Posted by Pin Cushion on Sep 2, 2010 11:37 am


Larry,

It is damn near unenforceable. It is similar to requiring a plat for any survey in North Carolina without a plat recording law... unenforceable. Your, our, their board only has power under licenses, licensees, and business in the State of North Carolina.  Bock and Clark, MKA, The Matthews Company, A-1 , etc... (to many too name) are operating and will continue to "coordinate" surveys in North Carolina.

I bet I can get quotes from more than one "alta management" / survey company (whatever you want to call it) in no time with no license, no licensees, and no NC registered business entity.
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Re: Surveying Business owned by other than Surveyor

Posted by Burk Cornelius on Sep 2, 2010 1:54 pm

This thread has morphed into two topics (kind of)

1. Business owners being a licensed professional. I'm not saying it doesn't happen (the government is famous for overreaching its authority) but I find it hard to believe that a State Board, or any agency, could successfully require a business owner to be a licensed professional. Not only is that restraint of trade but it just doesn't make sense. Doctors don't always own hospitals but they do provide medical services to patients. 

2. Survey Coordination and licensure. I know this is sore subject around here and I don't care to debate it. However, on the topic of State Boards overreaching their authority. Here is a link the the LA Supreme Court opinion regarding Coordination firms and licensure in LA. The key statement from the court was "it would be absurd to think that and out-of-state land surveyor would have to obtain a state license merely to hire a land surveyor in LA"

http://caselaw.findlaw.com/la-court-of-appeal/1507767.html





Burk Cornelius, PLS
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Oklahoma Society of Land Surveyors
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Re: Surveying Business owned by other than Surveyor

Posted by Stephen Johnson on Sep 2, 2010 2:47 pm


I know it is "legal" in OK, TX, NM and CA.  In Arizona at least one principal in the firm must be licensed for each discipline in which the firm offers professional services.

I.E., If you offer Architect and Landscape Architect, the board requires at least one architect  and one Landscape Architect as principals of the firm.  Either as a part owner or as and officer of a corporation.


SJ



"I won't be wronged, I won't be insulted, and I won't be laid a hand on. I don't do those things to other people and I require the same of them."
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Re: Surveying Business owned by other than Surveyor

Posted by Burk Cornelius on Sep 2, 2010 3:13 pm

Agreed, Stephen but this thread was using ownership as the criteria. An officer in the firm is a much different situation. I could see how that might be required but not ownership.

Burk Cornelius, PLS
Executive Director
Oklahoma Society of Land Surveyors
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Re: Surveying Business owned by other than Surveyor

Posted by Stephen Johnson on Sep 2, 2010 3:16 pm


Burk

It may be either ownership or an officer.  It depends.

Partnerships  and sole proprietors require ownership.  Corporations require being an officer.

SJ
"I won't be wronged, I won't be insulted, and I won't be laid a hand on. I don't do those things to other people and I require the same of them."
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