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.