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Texas Legislative Issues

Lien Law Reform- Texas Lien Law is too complicated. ABC of Texas is working with other construction industry groups to develop a simplified approach that can be embraced by most if not all stakeholders. The goal is to simplify the preservation of lien rights and eliminate complicated tripwires without upsetting the balance in the current scheme. 

Neutrality in State Government Contracting- To protect merit shop contractors governmental entities governmental entities should not use project labor agreements (pre-hire collective bargaining agreements) for projects using state resources. The state would not be regulating labor practices (which is prohibited by the National Labor Relations Act) but acting in its capacity as a proprietor. Our goal is to prevent one from being required by the governmental  entity when state resources are being used.

Retainage/Trust Fund-If Lien Law Reform does not advance this session, ABC of Texas will join with TCA and AGC-TBB to support a means of assuring that statutory retainage (which protects project owners from liability in excess of the retainage) is available to contractors and subcontractors in the case of a default.

Lender Notice- Currently, there is no requirement that a lender tell anyone except the project owner when funds are cut off for a project. Thus, general contractors and subcontractors are left to improve the facility with no hope of getting the last payment, the retainage, or payment for any work performed before those parties discover funds have been cut off. There needs to be a provision requiring lenders to notify those performing work on the project when there is no hope of those parties being paid for their work.

Criteria for ADS Scoring- Some governmental entities have used different scores for the exact same experience when evaluating proposals under alternative delivery systems. There needs to be some transparency and consistency when alternative delivery systems are used to avoid the appearance of manipulation of the results.

Taxes-Franchise and School Finance-There is a lawsuite pending before the Texas Supreme Court challenging our existing school finance system. When the court rules, the Texas Legislature will likely have to address school finance. ABC of Texas needs to be prepared or minimize additional taxes on the construction industry.
           

State Breach of Contract- Legislation was passed in 2013 to provide a waiver of sovereign immunity for state governmental entities for breach of construction contracts. While an important first step, this legislation did not provide the same coverage as the waivers for other governmental entities in Texas. This statute needs to be consistent with the waivers of sovereign immunity for construction contracts with other governmental entities in Texas.

Worker Misclassification- The construction industry has been criticized for rampant worker misclassification (classifying employees as contractors). This type of misclassification is not unique to any one industry and may even be more rampant in others. To address the fact that worker misclassification gives violators a competitive advantage over those following the law, ABC of Texas has been willing to address the issue provided that contractors are only responsible for their own hiring decisions, legitimate use of individuals as contractors is protected and employers are not subject to increased penalties for good faith mistakes or arbitrary agency decisions.

Immigration- ABC of Texas believes that immigration is a federal issue. It is important in any state immigration statute dealing with employers that employers not be held liable if the employer is a victim of fraud. It is critical that employers who attempt to follow the law in good faith not be subject to additional penalties on the state level.

Purchasing Cooperatives- Site-specific construction is inappropriate for the use of interlocal contracts offered through purchasing cooperatives (with the exception of job order contracting). While purchasing cooperatives offer great savings for local governements when dealing with items for which there are economies of scale, construction is site-specific. There is the potential when using purchasing cooperatives for construction services for there to be manipulation in the bidding process, particularly when bidding specifications favor a particular manufacture.