Capitol Roundup

May 20, 2021

Quote of the Week

"Texans, not government, should decide their best health practices, which is why masks will not be mandated by public school districts or government entities. We can continue to mitigate COVID-19 while defending Texans' liberty to choose whether or not they mask up."

-Gov. Greg Abbott

Abbott made the comment in a May 18 press release after issuing an executive order prohibiting governmental entities in Texas — including counties, cities, school districts, public health authorities, or government officials — from requiring or mandating mask wearing. Exempt from the order are state-supported living centers, government-owned or operated hospitals, Texas Department of Criminal Justice facilities, Texas Juvenile Justice Department facilities, and county and municipal jails.

Inside this edition of Capitol Roundup:

Three key bills backed by AGC-TBB advance to critical stages of legislative process:

Design-defect liability

K-12 uniform general conditions

Statute of repose

Plus, updates on a dozen other bills backed by AGC-TBB

Visit online: AGC Texas Building Branch

Three AGC-TBB-backed bills advance to key stages as Legislature nears adjournment

Three major construction bills backed by AGC Texas Building Branch are making their way through the Texas Legislature and getting closer to reaching the Governor's desk for final passage.

If passed, the bills would make changes to state law in critical areas for the construction industry across Texas. The bills would accomplish the following:

Limit contractor liability for design defects (Senate Bill 219);
Allow school districts to adopt uniform general conditions (UCG's) for k-12 building construction (Senate Bill 338); and
Shorten the time that public building owners can sue for defects (statute of repose) on public work (House Bill 3069).

Design Defect Liability

Senate Bill 219 is sponsored by Sen. Bryan Hughes (R-Mineola) and Rep. Jeff Leach (R-Plano). The bill places new limits on contractor liability related to design defects and outlines a contractor’s duty to disclose such defects.

After getting approval from the Senate last month on a 29-1 vote, House members passed the bill 113-27 on May 13. Rep. Leach made one amendment to the bill to clarify that it does not apply to existing design-build projects with TxDOT, and the bill is now eligible for the Senate to concur with the amendment. If passed and signed into law by the Governor, the bill would take effect September 1, 2021.

Click here to read the text of SB 219.

Uniform General Conditions

Senate Bill 338 is sponsored by Sen. Beverly Powell (D-Burleson) and Rep. Eddie Lucio III (D-Brownsville). The legislation amends the Education Code to authorize a public school district to adopt uniform general conditions to be incorporated in all district building construction contracts.

The bill passed unanimously in the Senate last month on a 30-0 vote and cleared the House committee stage earlier this month on an 11-1 vote. The bill is now set on the House calendar for May 20. If passed and signed by the Governor, the bill would take effect September 1, 2021.

Click here to read the text of SB 338.

Statute of Repose

House Bill 3069 is sponsored by Rep. Justin Holland (R-Rockwell) and Sen. Hughes. The bill would shorten the time public building owners can sue for defects (statute of repose) from 10 years with a two-year tail to eight years with a one-year tail for public projects. Building owners would have an additional year (instead of an additional two years) to sue for defects discovered in the last year. Under current law, alleged defects must be found within 10 years of the building’s completion, and building owners get an additional two years to sue for defects discovered in the tenth year.

The bill passed in the House on May 4 on a 141-3 vote, and it cleared a Senate committee by a 9-0 vote on May 18. The bill is now on the Senate calendar for May 20. If passed and signed by the Governor, the bill would take effect September 1, 2021.

Click here to read the text of HB 3069.

Updates on legislation supported by AGC-TBB

The Legislature has until May 31 to finally pass legislation and forward to the Governor for his signature. The following is a list of a dozen key AGC-backed bills with updates on their progress.

Omnibus pandemic bill, business liability/insurance protections for contractors – SB 6 (Hancock/Leach) passed Senate 29-1, passed House committee 8-0, placed on House Calendar for May 21.

Deductibility of PPP loans for state franchise tax – HB 1195 (Geren/Hancock) passed House 143-1. Passed Senate 31-0, signed by Governor. Effective immediately.

Tuition revenue bonds (TRBs) for higher education construction – HB 1530 (Murphy/Seliger) passed House 121-23, referred to Senate Higher Ed Committee.

Local preemption on private business (sick leave, scheduling, benefits, criminal background) – SB 14 (Creighton/Phil King) passed Senate 19-12, passed House committee 8-2, sent to House Calendars Committee.

Clean up court confusion regarding quantum meruit claims against contractors ((Skyline v. ISC Acquisition – 5th Circuit Court of Appeals, Dallas (2018)) – HB 3355 (Schofield-not heard). This bill is dead for the session.

Close CGL coverage gap for attorney’s fees due to In Re Nalle case – HB 2416 (Gervin-Hawkins/Powell) passed House 144-0, referred to Senate State Affairs Committee.

Modernizing and simplifying lien laws – HB 2237 (Burrows/Johnson) passed House 136-1, heard and pending in Senate committee.

Reform litigation abuse over commercial vehicular accidents – HB 19 (Leach/Taylor) passed House 81-49, passed Senate committee 9-0, passed Senate 30-1.

Fix from last session’s “right to repair” construction defects bill – HB 3221 (Leach/Creighton) passed House 100-42, referred to Senate State Affairs Committee.

Fix from last session’s contingency lawyers bill on construction defects – SB 1821 (Huffman/Canales) passed Senate 31-0, passed House committee 11-0, Passed House 145-0.

Fix last session’s certificate of merit bill regarding design-build problems – HB 3162 (Martinez/Sen Lucio) passed House 143-1, referred to Senate State Affairs and scheduled for public hearing on May 20.

Using Texas Workforce Commission data as option for determining prevailing wage rates – SB 518 (Kolkhorst/Morrison) passed Senate 18-12, passed House committee 7-4, in House calendars committee.