Regular Session - AGC Supported Legislation

HB 628 by Representative Callegari/Senator Jackson – Alternative Project Delivery Methods for Public Construction.  This bill could be termed the marathon piece of the legislative report as it has been worked on since 2005.  It does show that in the end persistence pays off.  It consolidates 3 current statutes that govern the public procurement process (Education Code – Chapter 44; Local Gov’t Code – Chapter 271; and Gov’t Code – Chapter 2166) into a new single statute – Chapter 2267 of the Government Code.  The legislation also settles some AGC concerns with frivolous lawsuits regarding “alleged school construction defects” by making key changes in the law that should ensure that in real defect cases the repairs are made to the schools.  It will also allow TEA to join in suits with the state, receiving funds back that were received and were not used to make repairs.  It essentially removes the incentive to file frivolous lawsuits.  This legislation goes into effect on September 1, 2011.

HB 398 and SB 1042 by Representative Jim Jackson and Senator Hegar – School Background Checks.  This legislation was passed and signed not just once, but two times.  This legislation states that when school background checks are required, they will continue to be the responsibility of the employee’s employer and that the background check that will be done will be the same one that was required for contractors in the original legislation passed in 2007.  The technical correction bill passed last session cited the wrong section in the statute for the background checks.  Both bills were passed because of concerns that one or the other was getting caught up in the usual conflict between the Senate and the House over the other body not passing their bills.  It was signed by Governor Perry on June 17, 2011 and went into effect immediately.  AGC recognizes there are issues regarding the portability of the background checks and will be working on this issue in the interim with both the Texas Education Agency and the Department of Public Safety.

SB 1048 by Senator Mike Jackson/Representative John Davis – Public Private Partnerships.  This legislation will be a game changer in Texas for the industry.  It was brought to the industry’s attention that these types of projects have been taking place in Texas with no real rules to govern the process.  SB 1048 is modeled on Virginia’s P3 Legislation but with its own Texas flavor.  These types of projects will now be recognized and allowed by the new law in the Government Code.  It will cast sunshine on the P3 process.  The procedures that have been put in place with the legislation are not exclusive and do allow for procedures allowed in another statutory authority.  Guidelines for the P3 projects will be required.  The bill has a list of specific considerations for state entities, but does not require these considerations for local governmental entities.  State highways are excluded in the legislation.  The legislation goes into effect on September 1, 2011.

HB 2093 by Representative Thompson/Senator Van de Putte – Consolidated Insurance and Indemnification Clauses.  This bill started as a consolidated insurance bill and finished by adding a variation of language dealing with indemnification clauses and additional insured provisions (AGC/TCA compromise language).  The CIP language makes minor changes, but does require policies to have three years of completed operations coverage.  The amendment does include “anti-indemnity” language and allows for “joint defense agreements”.  It carved out some residential projects and also carved out “city public works projects” – thus allowing for indemnification clauses to still be used as they currently are on these two carve outs.  The bill was signed by Governor Perry and will take effect on January 1, 2012.

HB 51 by Representative Eddie Lucio III/Senator Hinojosa – High Performance Building Standards.  This is a “green bill” that will require new state buildings or renovations to meet high-performance standards that will be set by the State Energy Conservation Office (SECO).  It will require a 15% reduction in water use.  It allows for design flexibility with SECO certification of high-performance design evaluation systems.  There will be a SECO appointed advisory committee and one of those appointees will be from AGC Texas Building Branch.  The legislation goes into effect on September 1, 2011.

HB 679 by Representative Button/Senator Carona – Change Orders for Local Governmental Entities.  This bill allows for the delegation of approval of change orders of $50,000 or less to certain governmental administrators.  It does have some special limitations for three different types of districts (sports facilities, jails and certain water districts).  This legislation was signed by Governor Perry on June 17, 2011 and went into effect immediately.

HB 1711 by Representative John Davis/Senator Jackson – Disaster Remediation Contracts.  This legislation should help with some of the abuses that occur after natural disasters.  It regulates contracts for the removal, cleaning, sanitizing, demolition, reconstruction or other improvements to real property caused by a natural disaster.  Contracts are required to be in writing, may not require any payment before commencement of work, payments must be reasonably proportionate to work performed and a statutory disclosure must be included.  This bill was signed by Governor Perry on June 17, 2011 and went into effect immediately.

SB 425 by Senator Carona/Representative Hancock – Certificates of Insurance.  This legislation creates a new Insurance Chapter 1811 Code for “Certificates of Property & Casualty Insurance”.  Any new forms will have to be approved by the Texas Department of Insurance (TDI). Standard Accord Forms are deemed to be approved by TDI.  This legislation was signed by Governor Perry and will go into effect on January 1, 2012.

HB 1456 by Representative Orr/Senator Deuell – Lien Waiver Forms.  This legislation will create a new set of four statutory lien waiver forms.  They are as follows: A) Conditional waiver and release on progress payment; B) Unconditional waiver and release on progress payment; C) Conditional waiver and release on final payment; and D) Unconditional waiver and release on final payment.  The legislation was signed by Governor Perry and will go into effect on January 1, 2012.

HB 1390 by Representative Deshotel/Senator Estes – Retainage Notices.  This legislation was put forth by TCA and was discussed by TCA, AGC and ABC during the interim.  AGC opposed the legislation as it was filed, although it was supported by TCA and ABC.  The AGC concerns were that the proposed legislation would in actuality slow down the final payment process for retainage for everyone on a project.  As the legislation was about to be considered by the House, a major battle was shaping up – it was agreed to by the parties involved to take one last stab at addressing the concerns.  In a matter of a few hours, a compromise was agreed to so that all three groups could support the legislation.  AGC thanks TCA and ABC for their willingness to reach a final agreement on this legislation that will benefit the industry.  The Texas lien laws are very complicated.  The legislation supported by all three groups was signed by Governor Perry and will go into effect on September 1, 2011.  Chairman Deshotel recognized the complexity of the Texas lien laws and is expected to ask for an interim study to review the current statutes.