April 28, 2017

This week's Capitol Roundup :

2017 Convention Alert: Last day to register for the hotel group rate is May 3.  CLICK HERE for more information. 

  • Top bills on the move: Right to repair and state breach of contract bills advance to full House
  • House votes to eliminate business franchise tax
  • Marathon debate leads to House approval of ban on "sanctuary cities"

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AGC Texas Chapters

Quote of the Week
"I'm not doing that. I didn't get to be a fat white boy by not eating."
-State Rep. Charlie Geren

Geren (R-Fort Worth) made the comment in response to Rep. Victoria Neave's (D-Dallas) four-day fast in protest of a bill Geren is sponsoring. The measure, Senate Bill 4, bans so-called 'sanctuary cities' and would impose penalties on cities and counties that decline in some way to assist federal immigration enforcement.
Bills on the Move: Right to Repair and State Breach of Contract bills advance

Heading to the House floor...
Three bills at the top of AGC Texas Building Branch's wish list were voted out of committee and are headed to the House floor. The bills advanced despite a grueling House debate on a "sanctuary cities" bill lasting until early Friday morning.

Rep. Paul Workman
The three measures - sponsored by Reps. Paul Workman (R-Austin) and John Cyrier (R-Lockhart) - contain key provisions supported by AGC-TBB that have been gaining momentum in the Legislature for several years. 

Workman's "right-to-repair" bill (HB 2343) allows contractors subject to potential defect claims to have 150 days to fix the defect and allows for inspection by a third-party engineer attended by all parties subject to the claim. The measure passed committee on a 7-0 vote.
Rep. John Cyrier

Cyrier's twin bills deal with state breach of contract and fix some lingering issues from 2015 when a landmark bill was passed to allow the state to be sued for breaking its contractual commitments. Cyrier's bills - HB 2121 and HB 2128 - allow for collection of attorney's fees for smaller claims (under $250,000) and lets oral directives be collected under the law. 

Workman and Cyrier - both of whom previously held leadership roles within AGC - now await full House votes on their bills, which will be scheduled by the Calendars Committee. 

Rep. Ramon Romero Jr.
Meanwhile, another top AGC-TBB bill - HB 3357 by Rep. Ramon Romero Jr. (D-Fort Worth) - has also passed the committee hurdle and awaits a full vote by the House. The bill addresses "employee misclassification" issues by amending the state prevailing wage statute.

Committee votes pending...
Two more key AGC-TBB bills have had favorable hearings in House committees but still need to be voted on before heading to the House Calendars Committee. 

A bill to  decide when the state's mandatory background check applies to school construction projects - HB 3270 by Rep. Dwayne Bohac (R-Houston) - was heard in the House Education Committee last night. A vote is pending. 

Another bill - HB 3065 
by Rep. Joe Deshotel (D-Beaumont)
- would simplify and streamline the state's lien process with an online system that eliminates hidden claims and fixes notice issues. The bill is currently stalled in the House Business & Industry Committee.

The last day for bills to be voted out of House committees is May 8, and all bills must be voted on by the full House no later than May 12 in order to be heard in the Senate.
House votes to phase out business franchise tax

The House voted late Thursday night to phase out the state franchise tax - also known as the "margins tax." The bill is expected to head to the Senate after a final procedural hurdle in the House.

The measure - HB 28 
by Rep. Dennis Bonnen (R-Angleton) - passed on a 98-45 vote and would reduce and eventually eliminate the tax over several years. 
The business tax was a hot-button issue in 2015 when the rate was significantly lowered at a time when many legislators preferred total repeal. 

Rep. Dennis Bonnen
The bill "puts the franchise tax on the correct path, and that is the path of going away," Bonnen said. He added that the bill's original intention of providing property tax relief has not been realized. 

While Bonnen did not put a timeframe on the tax's final repeal, he called his bill "more aggressive" than its counterpart in the Senate. Sen. Jane Nelson (R-Flower Mound) has passed a similar bill by a 23-7 vote and sent it to the House. Her bill would phase out the tax in ten years. The two chambers will need to come to an agreement on the final terms. 

Though some Democrats voted in favor of Bonnen's bill, several derided the action as short-sighted in light of the state's current $2.5 billion budget gap. However, Bonnen insisted the $7.82 billion that the tax hauls in every two years would be made up by economic job growth. 

Bonnen's bill would allocate up to $3.5 billion of the ending balances in state general-revenue funds each two-year budget cycle in order to pay down the tax. Franchise tax rates would be lowered each cycle to account for the ending balances. Eventually, the rates will reach zero.  Bonnen's bill would take effect September 1, 2019, and would apply only to a report originally due on or after January 1, 2020. 

Nelson's bill, meanwhile, would dedicate half of any state revenue growth above five percent to reducing franchise tax rates, which would eventually reach zero. Gov. Greg Abbott
and Lt. Gov. Dan Patrick both favor the bill. 
House passes ban on "sanctuary cities"

After a long debate stretching into the early hours of Friday morning, House lawmakers voted to ban so-called "sanctuary cities" and impose penalties on uncooperative officials. 

Voted along party lines, SB 4  by  Sen. Charles Perry (R-Lubbock)  passed by a 94-53 vote.  The bill, sponsored by  Rep. Charlie Geren (R-Fort Worth) 
i n the House, largely mirrors the version passed in the Senate in February. 

Rep. Matt Schaefer (R-Tyler) added the so-called "show-me-your-papers" amendment to the bill, which would allow  law enforcement to question a person's immigration status while detained despite not being charged with a crime. 

The Senate is likely to accept the proposed change since the bill contained a similar measure in its original form.  Another amendment to allow elected officials to be removed from office if they violated the provisions of the bill was also tacked onto the bill. 

The bill now heads back to the Senate, where senators can either accept the House's changes or work out the differences in a conference committee. If passed, the bill is likely to be signed by Gov. Greg Abbott and enacted into law. 

8 - Last day for votes in House committees
12 - Last day for votes in House (full House)
29 - Last Day of 85th Legislature

8 -  AGC TBB Safety Committee Meeting - Austin
18-21 -  AGC TBB Annual Convention - Coueur d'Alene Resort, Idaho

29-30 - AGC-TBB Strategic Planning Meeting

3 -  AGC TBB Safety Committee Meeting - TEXO
17 - AGC TBB Board Meeting - Austin AGC Office