July 27, 2017

This week's Capitol Roundup :
  • Senate races through Abbott's special session agenda; focus turns to House
  • Bill to streamline local permitting moves through Lege among other local government bills
  • House Business & Industry Committee meets to discuss contracting and lien laws

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AGC Texas Chapters

Quote of the Week
"No one gets to hide."
-Gov. Greg Abbott
Gov. Greg Abbott made the comment on the eve of the special session he called for lawmakers to reconvene in Austin. The comment refers to a list Abbott has said he will be keep to track how lawmakers vote on his special session agenda.
Lawmakers move on Abbott's agenda as special session clock ticks

Lawmakers from across the state are back in Austin as the 85th Texas Legislature's special session is in full swing. The special session, which began last Tuesday, was called by Gov. Greg Abbott after legislators failed to reach an agreement on some key pieces of legislation during the lawmaking body's 140-day regular session that concluded at the end of May.
Under the Texas Constitution, the governor has the power to decide the topics up for debate during the session, which can last up to 30 days. However, lawmakers have the power to interpret those issues pretty broadly. So, while Abbott has declared 20 subjects for this special session, lawmakers have already filed more than 400 bills in the past week. Ultimately, Lt. Gov. Dan Patrick and House Speaker Joe Straus decide when the session ends; once a chamber adjourns, the session is essentially over.

Gov. Greg Abbott looks on as Lt. Gov. Dan Patrick (left) and House Speaker Joe Straus shake hands May 27 at the Capitol.

If there was one bill that was a "must-pass" measure, it was the so-called "sunset" legislation. Under Abbott's direction, this legislation needed to be addressed before the other 19 issues could be discussed, and the legislature has complied. Both the House and the Senate passed versions of the bill last week that would aim to extend the life of five state agencies up for review, including the Texas Medical Board. While the two governing bodies have not yet agreed to a final version of the bill, Abbott gave them the go-ahead to begin work on his other items.
Two of the most hotly contested items on the Abbott agenda include the "bathroom bill" legislation and an effort to build on last session's property tax reforms. The stalling of these two measures in the House back in May is in large part why the Senate held up the sunset legislation, ultimately pushing the special session into play. On Tuesday, the Senate sent a version of the bathroom bill - Senate Bill 3 - to the House on a 21-10 vote after eight hours of debate.
Abbott has since declared property tax reforms to be his top priority on the 20-item agenda, however, the governor has not staked clear preferences for the House or Senate versions of that legislation or several of the other items, which range from regulating what property owners can do with trees on their land to cracking down on mail-in ballot fraud.
Abbott has made one thing clear: he will be watching lawmakers closely, he says. Abbott has said he will be tracking how lawmakers vote for the special session. That close watch could have heavy implications for legislators as they move into the 2018 election cycle alongside Abbott, who has amassed more than $41 million in his campaign fund.
Lt. Gov. Dan Patrick has moved in near lockstep with Abbott's call to go "20 for 20" on his agenda, calling himself the governor's "wing man." However, House Speaker Joe Straus has expressed some opposition, namely to the bathroom bill legislation and some measures to place more local-control regulations in the hands of the state. By the end of the day on Wednesday, the Senate had passed 18 bills, which Patrick boasted as a milestone. However as during the regular session, the House is moving at a much more cautious pace and will be the focus of attention moving forward. 
The next major debate to play out in the special session is likely to revolve around local-control issues, including local spending caps, limits on cellphone use, and restrictions on how local governments can enforce city and county ordinances on private properties. Meanwhile, Abbott has begun meetings expected to last the next week or two with 18 mayors from across the state to discuss these kinds of local-control measures. However, Abbott has ignored requests for meetings from mayors of the state's five largest cities - Houston, San Antonio, Dallas, Fort Worth and Austin - and those of Plano and Sugar Land.
Wave of local-control bills could have impact on Texas commercial contracting

Along with a host of other proposals, Gov. Greg Abbott's special session agenda has resulted in legislation that would aim to speed up permitting for developments in cities and counties.  

The measure that passed the Senate this week would create deadlines for local governments to rule on building permits and bar local governments from forcing contractors to comply with local regulations in areas such as wages, training and insurance. The bill - Senate Bill 13 - sponsored by Sen. Konnie Burton (R-Fort Worth) passed the full Senate on Wednesday on a 18-13 vote and is now awaiting debate in the House. 
Sen. Konnie Burton

Under the bill, local governments would essentially have 30 days to approve or deny a building permit, and failure to take action would result in the permit's approval. The bill also requires cities and counties to submit plans detailing how a builder should fix a deficiency. 

During debate on the bill, Senate Democrats asked their colleagues to consider adding conditional permit approvals in order to allow cities to continue examining projects if health and safety issues were uncovered. The efforts failed. 

Rep. Paul Workman
The House companion bill - House Bill 164 - is sponsored by Rep. Paul Workman (R-Austin), who had filed similar legislation during the regular session. Workman, former president of AGC Texas Building Branch, said it's not the proper role of government to dictate on-site regulations, which he says is responsible for the long wait times for permits in Austin. 

"In the city of the Austin and indeed in a lot of other cities, the length of time it takes to get a permit to do something on your own property, whether it's adding a room to your house or building a new building, has just gotten to be real, real long," said Workman, who has 40 percent of his constituency in Austin. 

Other Local Government Bills

On Abbott's agenda are many other items that would affect local government. Two of those areas are outlined below. Others include: local budget increase caps; municipal annexation reform; local use of phones in vehicles; and a ban on local governments collecting union dues. 

Property Taxes

Aside from permitting, the Texas Legislature has also been debating several other measures that would affect how local governments do business. The most high-profile legislation is one that would reform local property tax codes by forcing  an election if a city or county tries to raise property taxes more than 5 percent. Currently, an election is triggered by tax increases above 8 percent, and only if residents petition to put it on the ballot. The Senate passed a version of the measure in Senate Bill 2, which awaits debate in the House.

Tree Regulations

More than 50 cities and towns in the state require residents to replace trees or pay a fee when they cut down certain trees on private property. Gov. Abbott has called for a bill to ban municipalities from enacting such rules. Abbott worked with Rep. Paul Workman on House Bill 70, which in its latest version would would allow property owner associations to continue to enforce deed restrictions. The bill is still in committee. 
House committee meets to discuss contracts and lien laws

The House Committee on Business and Industry, chaired by Rep. Rene Oliveira (D-Brownsville), met today in Austin on Tuesday to hear testimony on construction contracts, liens, and liability from contractors, lawyers, bankers, and worker's rights groups. 

The meeting served as a way to open a dialogue about the state's current commercial and residential contracting procedures and jumpstart the process of making reforms in future legislative sessions. 
Rep. Rene Oliveira

Much of the discussion centered around mechanic's lien laws in Texas and how the state treats "retainage" in construction contracts. In general, retainage refers to  a portion of the agreed upon contract price withheld until work is "substantially complete" to assure that contractor or subcontractor will satisfy its obligations.

Jason Kennedy, a Dallas construction lawyer, described the current laws as "incomprehensible to understand." He said they need to be modernized and that retainage should be removed.   Sean McChristian, a construction lawyer, said how he found the Wyoming system easier and simpler than the mechanism in place in Texas. He said retainage is a "problem which can spread across projects" by the withholding of payment for "improper reasons." 

Anna Bocchini of the Equal Justice Center stated low-wage "vulnerable" workers should be included in legislation because wage theft is "rampant."  Meagan McCoy Jones of McCoy Building Supplies discussed how residential construction business has few liens and supply companies take the "risk" by extending credit to builders. 

John Fleming of the Mortgage Bankers Assn. said there is a need for "empirical studies" regarding contractors not being paid. Many disputes are over the quality of work, and construction lending is the "riskiest" lending for banks, he said. He recommended "streamlining the system."

29-30 - AGC-TBB Strategic Planning Meeting

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