134 



TRANSACTION'S OF THE AMERICAN SOCIETY 



such a contract of furnishing- what might 

 reasonably be construed as "labor." 



Any method of charging a client for the 

 services of a landscape architect's em- 

 ployees which avoids the possibility 

 either of substantial speculative profit 

 or of considerable loss from this source 

 leaves the landscape architect free to use 

 his best judgment, substantially without 

 the bias of financial self-interest and 

 without the suspicion thereof, in deciding 

 what work and how much work to have 

 done by his own employees for the client, 

 and what to have done by others not on 

 his own payroll. He is then in the best 

 position to establish the value of the 

 skilled and disinterested service which he 

 renders in deciding such questions and 

 in the general direction of the work, and 

 to charge for that service known fees 

 properly commensurate with its value. 



A method of charging for the services 

 of assistants without substantial specula- 

 tive profit or loss must take account of the 

 indirect costs or overhead expenses. No 

 such method can be absolutely exact, be- 

 cause the apportionment of general over- 

 head expenses among many diflferent jobs 

 served by the facilities which are repre- 

 sented in the overhead expense is always 

 a matter of somewhat arbitrary judg- 

 ment. A rough approximation is enough, 

 if it is intelligently scrutinized from time to time 

 and readjusted With an honest, common-sense at- 

 tempt to mak.e it reasonably fair. 



A brief reference to the history of this 

 matter in the Olmsted firm will help to 

 indicate at least what I believe to be the 

 right tendency. 



Forty years ago the usual method of 

 the firm was to charge a lump sum fee 

 which covered the services both of mem- 

 bers of the firm and of assistants, and the 

 general overhead expenses, with pro- 

 vision in some cases for charging separ- 

 ately in addition only certain specified, 

 easily segregated and directly chargeable 

 items like traveling expenses. The office 



force was small and a large part of the 

 working up of details was apt to be done 

 by employees of the client, often recom- 

 mended for employment by the firm, and 

 working on the job under the advice and 

 supervision of the firm. In case of large 

 works extending over a considerable 

 period there is much to be said for this 

 method of pushing the details of design- 

 ing out on to the job itself. 



But as circumstances made it appear 

 desirable in the client's interest in more 

 and more cases to have a large amount 

 of detailed plan work, etc.. done by office 

 assistants, the practice grew up of charg- 

 ing for these assistants' services separate- 

 ly from the fee at the direct cost of these 

 services, the overhead expenses of the 

 office being still covered by the profes- 

 sional fee. 



About twenty-five years ago, the size 

 of the office having grown pretty large, 

 it became apparent that this method often 

 resulted in a loss, and anyhow was unde- 

 sirably speculative because much of the 

 overhead expenses such as rent, light, 

 heat, drafting materials, equipment, etc., 

 (not to mention the cost of idle time of 

 assistants, "ready to serve") were much 

 more nearly proportional to the amount 

 of assistants' services used on a given job 

 than to the personal services of the firm. 

 Therefore the method followed in many 

 engineers' offices was adopted, namely 

 charging up assistants' services at twice 

 the rate per hour at which those assist- 

 ants were paid, in order to cover over- 

 head expense, while the '"professional 

 fee" (which appeared on the bills separ- 

 ately from the charge for assistants' ser- 

 \'ices) was, on the average, reduced so as 

 to represent more nearly the value of the 

 personal services rendered by members of 

 the firm. 



It was found that year in and year out 

 this method of charging for assistants' 

 services covered, in the gross, the entire 

 direct cost of the assistants' services and 



