The Texas Construction Association (TCA) Legislative Update
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Texas Construction Association (TCA) Priority Legislation
Texas Legislative News – April 21, 2017
-----Status of TCA Priority Legislation-----
HB 2343 by Representative Paul Workman (R-Spicewood) has been set for a hearing in the House Business & Industry Committee on Monday, April 24.
For more information on Right to Repair, click here.
HB 2668 by Representative John Wray (R-Waxahachie) has been set for a hearing in the House Business & Industry Committee on Monday, April 24. This is a Priority Retainage bill for certain construction contracts.
SB 2073 by Senator Jose Rodriguez (D-El Paso), the Senate priority retainage legislation, is in the Senate Business & Commerce Committee waiting to be scheduled for a hearing.
For more information on Priority Retainage, click here.
Lien Law Modernization
On Monday, April 17, TCA member Kenneth Loper, Contracts Manager at TAS Commercial Concrete Construction, LLC, and TCA General Counsel Fred Wilshusen, Partner at the law firm Thomas, Feldman & Wilshusen, testified at the House Business & Industry Committee hearing in support of HB 3065 by Representative Joe Deshotel (D-Beaumont).
They testified on the complexity of Texas’ lien laws, the difficulty in complying with all of the notices required to secure one’s lien rights, and advocating that now is the time to modernize the lien laws. They talked about the legislation’s provisions to establish an early notice system and an Internet portal to allow all stakeholders, including lenders, owners, contractors, title companies, subcontractors and suppliers, to easily find information on a construction project.
The Associated Builders and Contractors of Texas and the Associated General Contractors-Texas Building Branch registered in support of HB 3065. Opposition testimony came from the Texas Association of Builders, lenders and suppliers. At the conclusion of testimony on the HB 3065, Chairman Rene Oliveira (D-Brownsville) announced that a working committee made up of Representative Workman, chair, Ramon Romero (D-Fort Worth) and Jason Villalba (R-Dallas) would meet with stakeholders affected by the legislation to understand their issues and provide input to Representative Deshotel, or changes to the bill. It is the intention of Chairman Oliveira to vote the legislation out of the committee on Monday, April 24.
SB 1506 by Senator Juan “Chuy” Hinojosa (D-McAllen), the Senate lien law modernization legislation, is in the Senate Business & Commerce Committee waiting to be scheduled for a hearing.
For more information on Lien Law Modernization, click here.
Responsibility for Defective Plans and Specifications
SB 1215 by Senator Bryan Hughes (R-Mineola) was PASSED by the full Senate on Wednesday, April 19 by a vote of 29-2. Senator Estes & Hall voted against the bill. The legislation now goes to the House to be referred to a committee. SB 1215 is intended to keep the construction team from being responsible for consequences due to defective design plans and specifications.
HB 2170 by Representative Kyle Kacal (R-College Station), which also deals with responsibility for defective plans and specifications is in the House Ways and Means Committee awaiting a hearing.
For more information on Responsibility for Defective Plans and Specifications, click here.
State Breach of Contract
Generally, statutes allowing for the breach of sovereign immunity defense restrict or prevent the recovery of attorney fees absent a contractual agreement for them. HB 2128 and HB 2121, both by Representative John Cyrier (R-Bastrop), make amendments to existing statutes governing immunity from lawsuit by governmental entities and the recovery of attorney fees in those types of lawsuits. Both bills were heard in the House Judiciary and Civil Jurisprudence Committee on April 18 and at the conclusion of testimony on the bills, they were left as pending business in the Committee.
Statute of Repose
HB 1053 by Representative Morgan Meyer (R-Dallas) was heard in the House Judiciary & Civil Jurisprudence Committee on March 28 and at the conclusion of testimony was left as pending business in the committee.
For more information on Statute of Repose, click here.
School Background Checks
HB 3270 by Representative Dwayne Bohac (R-Houston) is in the House Public Education Committee waiting to be set for a hearing. Before work can begin on certain public school projects, individuals who will be working on the project are required to pass a background check. In many cases, different school districts have different background check requirements. With over 1,200 school districts in Texas, this is a significant problem. Having to comply with these different background checks is a costly process that also takes extra time to complete. This cost is ultimately borne by the school districts.
For more information on School Background Checks, click here.
Attorney Fees
An amended version of HB 744 by Representative Jessica Farrar (D-Houston) was passed by the full House of Representatives by a vote of 103-45 on March 15. The bill now is in the Senate waiting to be referred to a Senate committee. HB 744 was amended on the House floor by Representative Morgan Meyer to replace language in HB 744 with language from HB 2457 by Representative Meyer. This new version of the bill will amend Chapter 38 of the Civil Practice & Remedies Code to add “other organization” in place of “other legal entity,” as was contained in the original version of HB 744, to Sec. 38.001(a) so attorney fees can be recovered from an individual, corporation or other organizations, including partnerships and LLCs, for claims for services, labor or materials. In addition, the amended bill does not have an exception for other statutes concerned with recovery of attorney fees in sovereign immunity cases as was contained in the original version of HB 744.
-----Other Construction-Related Legislation Being Followed-----
SB 23 by Senator Charles Schwertner (R-Georgetown) will require state contractors to participate in the federal electronic verification of employment authorization program, or E-Verify. The bill was approved by the full Senate by a vote of 22-9 on March 28. The legislation is now in the House waiting to be referred to a House committee.
HB 639 by Representative “Doc” Anderson (R-Waco) is now in the House Calendars Committee for consideration to be placed on the House Calendar. HB 639 would authorize school districts to obtain health, liability and auto insurance coverage to protect businesses that partner with the school district to provide students career or technology training.
HB 1304 by Representative Oscar Longoria (D-Mission) and SB 592 by Senator Eddie Lucio, Jr. (D-Brownsville) would establish a rebuttable presumption of employment relating to the classification of workers under the Texas Unemployment Compensation Act. The bills call for a penalty of $200 per employee to be assessed against employers who misclassify their employees. HB 1304 was heard in the House Economic and Small Business Development Committee on April 20 and at the conclusion of testimony on the bill it was left as pending business in the committee. SB 592 is in the Senate Natural Resources and Economic Development Committee waiting to be set for a hearing.
HB 1477 by Representative Armando Walle (D-Houston) requires workers’ compensation insurance coverage for building and construction contractors. This bill was heard in the House Business & Industry Committee on April 3 and at the conclusion of testimony was left as pending business before the committee.
HB 2689 by Representative Jim Murphy (R-Houston) will amend the Government Code to allow a third party to conduct prevailing wage surveys for determining prevailing wage rates for public works contracts and must be conducted within a three-year period preceding the date the public entity calls for bids on a public works project. This bill is in the House Business & Industry Committee waiting to be set for a hearing.
HB 3020 by Representative Cyrier will amend the Education Code to require school districts to give timely written notice to parties when the district brings an action for recovery of damages for the defective design, construction, renovation, or improvement to an educational facility. This legislation is in the House Appropriations Committee awaiting a hearing.
HB 3357 by Representative Ramon Romero, Jr. (D-Fort Worth) would amend the Government Code and set a fine of $90 per worker misclassified on a public works project. The bill was heard in the House Business & Industry Committee on April 17 and was reported favorably from the committee on April 19. It is now in the House Calendars Committee waiting to be set on the House Calendar.
HB 3434 by Representative Linda Koop (R-Dallas) would amend the Education Code to adopt uniform general conditions that will be incorporated in all building construction projects undertaken by school districts. The bill was heard in the House Public Education Committee on April 18. At the conclusion of testimony, the legislation was left as pending business in the committee.
HB 3913 by Representative Hugh Shine (R-Temple) is scheduled for a public hearing in the House Urban Affairs Committee on Tuesday, April 25. The legislation would amend the Government Code relating to public works projects to require a governmental entity to hold no more than 5% retainage on a project with a total value of $1 million or more, and if the governmental entity obtains beneficial use of the project, the retainage withheld cannot exceed 2% of the contract price. On projects where the total value of the contract is less than $1 million and the public entity has beneficial use of the project, the retainage may not exceed one-half of the total retainage under the contract.
