By: Telford H.B. No. 2467 73R5433 CAG-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to bonding requirements for a private contractor 1-3 undertaking construction or making an improvement on private 1-4 property; providing civil and criminal penalties. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. DEFINITIONS. In this Act: 1-7 (1) "Construction" means the erection, enhancement, 1-8 repair, renovation, or remodeling of a building. 1-9 (2) "Improvement" means: 1-10 (A) a building, structure, fixture, or fence 1-11 erected on or affixed to land; or 1-12 (B) a transportable structure that is designed 1-13 to be occupied for residential or business purposes, whether or not 1-14 it is affixed to land, if the owner of the structure owns the land 1-15 on which it is located, unless the structure is unoccupied and held 1-16 for sale or normally is located at a particular place only 1-17 temporarily. 1-18 (3) "Person" means an individual, association, 1-19 corporation, partnership, or other private legal entity. 1-20 (4) "Private contractor" means a person that for 1-21 compensation offers to undertake or does undertake construction on, 1-22 or makes an improvement to, private property. 1-23 SECTION 2. CONTRACTOR REQUIREMENTS. Before undertaking 1-24 construction on or making an improvement to private property, a 2-1 private contractor shall: 2-2 (1) enter into a written contract with the owner of 2-3 the property that describes the scope, quality, and cost of any 2-4 service to be provided by the private contractor; 2-5 (2) obtain all permits or licenses necessary for the 2-6 construction or improvement; and 2-7 (3) post a private contractor conduct surety bond. 2-8 SECTION 3. PRIVATE CONTRACTOR CONDUCT SURETY BOND. (a) A 2-9 contractor shall file with the municipal or county authority 2-10 issuing a necessary permit or license a surety bond in the amount 2-11 of $10,000, conditioned on the contractor's performance of the 2-12 written contract for which a permit or license is issued. 2-13 (b) A surety bond required under this section must include 2-14 the following statements on the face of the bond: 2-15 (1) that the contractor shall comply with the 2-16 requirements of Section 2 of this Act; and 2-17 (2) that the contractor agrees that the amount of the 2-18 bond shall be paid to the owner of the property if the contracted 2-19 work is not completed or is improperly performed. 2-20 (c) The municipal or county authority issuing a necessary 2-21 license or permit shall adopt rules relating to: 2-22 (1) the form of the surety bond; 2-23 (2) necessary qualifications for a surety; 2-24 (3) the method for filing and obtaining approval of 2-25 the bond by the authority; and 2-26 (4) release or discharge of the bond. 2-27 SECTION 4. CRIMINAL PENALTY. (a) A person commits an 3-1 offense if the person is a private contractor and knowingly or 3-2 intentionally violates a provision of this Act. 3-3 (b) An offense under this section is a Class B misdemeanor. 3-4 SECTION 5. EFFECTIVE DATE. This Act takes effect September 3-5 1, 1993, and applies only to construction of, or an improvement to, 3-6 private property that is initiated on or after the effective date 3-7 of this Act. 3-8 SECTION 6. EMERGENCY. The importance of this legislation 3-9 and the crowded condition of the calendars in both houses create an 3-10 emergency and an imperative public necessity that the 3-11 constitutional rule requiring bills to be read on three several 3-12 days in each house be suspended, and this rule is hereby suspended.