"We as engineers must continue to protect the public and encourage all engineers and their state and national engineering societies to write and call their legislators to support the Civil Rights Tax Relief Act S-557" Louis Albano, Engineering Times

"The bill [Civil Rights Tax Relief Act S-557] is necessary, because the present tax code has the habit of punishing the whistle-blowers and victims of discrimination by taxing their recoveries of lost income only in the year in which they make their recovery." Idaho Senator Mike Crapo

"Engineers are dedicated to protect the public, and should not be penalized financially after a jury rules in their favor." Attorney Jeff Strother, Engineering Times

All engineers should be aware that if they prevail in court and win a large financial settlement, they could lose the compensation they receive to legal expenses, attorney fee, and state and federal taxes, such as the Alternative Minimum Tax (AMT). The AMT was created in 1969 to close what many viewed as loopholes that allowed the wealthy to avoid paying federal taxes. Unfortunately, these tax codes can also create unfair taxation for individuals who win a financial settlement in a court of law.  A new bill, Civil Rights Tax Relief Act S-557, could help solve this problem.

My story of how I stood up to protect the public illustrates the injustice that the current tax codes can create.  I was employed as an engineer by the city of Idaho Falls for 27 years.  In July o 1996, I was forced by the city to resign because I refused to endorse engineering plans that ignored safety standards.  In June of 2000, after four years of convoluted

 litigation, a jury awarded me approximately $290,000 to compensate me for the pay that I lost as a result of the city’s misconduct.  Although that award was intended to compensate me for earnings lost from 1996 to 2000, under current tax codes it was taxable in its entirety in the fiscal year 2000.

As a result, I paid about $41,000 more in taxes than I would have paid under normal taxation of my yearly earnings.  This is 73% more than I would have paid if the city hadn’t wrongfully terminated my employment.  I can tell you from firsthand experience that it was difficult enough to vindicate public safety and my rights as a whistleblower without having the federal government profit by way of increased tax revenues from the city's misconduct, which created the problem in the first place.  The Civil Rights Tax Relief Act S-557 would change the current code to better achieve this neutrality.

Several organizations supported my case, including the (AEA), the National Society of Professional Engineers (NSPE), the International Society of Professional Engineers (ISPE), the American Society of Mechanical Engineers (ASME), the American Society of Civil Engneers (ASCE), and the Engineering New Record. 

Several individuals also supported my case, including expert witness Michael Rabins, PhD, PE, faculty member of Texas A & M University and coauthor of Engineering Ethics: Concepts and Cases; NSPE Legal Counsel Arthur Schwartz, who wrote IRS Commissioner Mark W. Everson and the Idaho Attorney General in support of my litigation; and Keith Thayer, PE, president of the ASME, who also wrote a letter to the court in support of my efforts.  My wife Debra also helped tremendously by reviewing depositions, writing letters, keeping notes, organizing documents, and conducting research.   

Since Idaho is a Community Property State, the financial loss after the trial was also her loss.

The engineering community will benefit if the Civil Rights Tax Relief Act S-557 passes.  More import5antlyk, the public will benefit because engineers will not have to fear a financial loss if they prevail in court for doing the right thing; protecting the public, not only in Idaho but nationwide.

For more information about this issue, go online to www.aeaworld.org or www.responsiblecharge.com.

About the Author

Ed Turner graduated from Santa Monica College in 1961 and received his professional engineering and land-surveying license in 1978.   He became city engineer of Idaho Falls in 1980. Throughout his career he has been involved in numerous engineering organizations, and has been recognized through several professional awards, such as the “Volunteer Tutor of the Year 2002-2003” award from Eastern Idaho Technical College, where he’s served as a math tutor for almost 20 years.  Turner also received the Vanguard Award in 1999 “For Extraordinary Courage, Dedication, Initiative, and Perseverance Demonstrating at Great Personal Risk a Path Toward Elevating the Engineering Profession and Safeguarding the Public Interest” from the American Engineering Alliance, the 1998 “News Maker Award,” and the “Bovoy Endowment for Ethics and Professionalism in Engineering.”

Turner conducts lecture tours speaking to university students about ethics, responsible charge, and public safety.  The case described in this article was featured in the recently published Engineering Ethics: Concepts and Cases (3^rd ed.), by C.E. Harris, M.J. Pritchard, and M.J. Rabins.