Washington, D.C. – May 18, 2010 – From the American Institute of Architects – The major issue facing America’s architectural profession continues to be the lack of access to financing even as the rest of the economy signals a recovery, one Baltimore architect testified today before the House Financial Services Committee.

Jim Determan, AIA, an architect with Hord Coplan Macht of Baltimore, Maryland, and a former board member of the American Institute of Architects, told lawmakers how the credit crunch in late 2008 contributed to the demise of his prior firm, CSD Architects. As lenders broadly refused credit to the design and construction industry, many CSD projects came to a halt.

In Determan’s case, he and his partners were left with no choice but to close their 60 year-old firm that had successfully weathered previous recessions. As a result, more than 100 people – many of whom had been with the firm more than 30 years - lost their jobs.

“The pendulum has swung so far in the direction of restricted credit that even worthy, well-secured projects by clients with impeccable credentials and proven track records are being denied access to financing,” Determan testified. “The mentality (of lenders) appears to be: ‘since financing everything didn’t work, let’s finance nothing,’ ” he added.

This thinking, in turn, has led to a vicious circle in which construction client financing evaporates. That leads to financing disappearing for architectural firms. Today, nearly one in four architects are out of work and many have been working without pay for as long as 18 months.

“If you ask architects across the country today why conditions are so bad, you will inevitably hear the same two responses: one, firms are unable to secure credit to keep operations going; and two, clients are unable to secure the financing needed to get construction and renovation projects started,” Determan testified.

Determan expressed support for several specific pieces of legislation that would help solve this dire situation: