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Texas Lien Law Bill – A Closer Look

“We have a bad lien law system that cannot be fixed”, stated Robert Bass, Winstead PC, who educated attendees on the updates of HB 3065-Texas Lien Law Modernization.He gave a brief history on the work AGC TBB has done since 2011.

“After the 2013 legislative session, AGC TBB, Texas Contractors Association, and the Associated Building Contractors got together and appointed a working group composed of attorneys to study how to resolve the issues,” he added.

It is the general contractors that take the risk under the current lien law system. The proposed bill would reduce the number of liens and claimants. “It also allows for the general contractor to know the full list of suppliers, subs, and subs’ subs.” He mentioned that now more than ever, information has to be transparent and accessible in the business climate today. “This proposed new system would allow you to manage your risk in a way you’ve never been able to do before.”

The proposed new lien law bill is modeled after one from North Carolina, which is a web-based system that offers a clear process to see who has filed claims, lien labor releases, etc. “In the fall of 2016, we held a formal meeting with bankers, owner groups, title industry representatives and insurance companies to review the language”, he added.

Thanks to the efforts of Rep. Workman “who was dragged in at the last minute” to the House Business & Industry committee who was reviewing HB 3065, the bill passed 7-0. Unfortunately,it died on the House floor. In the 2019 session, “it will be a fish or cut-bait session. We need to sign on a bill in which every group can reach an agreement and come up with a law that is fair for everybody. We are going to do everything we can to find a solution for the 2019 session”, he promised.

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