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.