ZEM H.B. 2766 75(R)BILL ANALYSIS


CIVIL PRACTICES
H.B. 2766
By: Bosse
4-16-97
Committee Report (Amended)



BACKGROUND 

Activities performed by a municipality are categorized by   101.0215(b),
Civil Practice and Remedies Code, Tort Act, as either proprietary or
governmental.  This Act allows a person to sue a municipality for certain
torts that may arise in the performance of these activities.  It specifies
those functions that are governmental and those that are proprietary.
Generally, proprietary functions are those that are discretionary. 

The designation of an activity as governmental rather than proprietary
subjects the claim to the liability caps established by the Act ($250,000
for each person and $500,000 for each single occurrence for bodily injury
or death and $100,000 for injury to or destruction of property). Community
development activities, even though inherently governmental, are not
categorized in the Act as either governmental or proprietary.  However,
courts have found them to be proprietary (i.e. discretionary), resulting
in unlimited liability for the municipality. Consequently, lawsuits
against municipalities relating to community development activities
diminish the funds available for projects within the municipality. The
designation of community development activities as a governmental function
should provide reasonable limits on recoveries in this arena and avoid the
potential of major losses which would reduce funding of community
development projects. 

PURPOSE

This bill would designate community development activity as a governmental
function which will place a monetary cap on tort claims arising out of
this type of activity.  

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency or
institution. 

SECTION BY SECTION ANALYSIS
 
SECTION 1 Amends Section 101.0215(a), Civil Practices and Remedies code by
adding "community development activity" as a governmental function. 

SECTION 2 Effective Date: September 1, 1997.  Applies prospectively.
Savings clause. 

SECTION 3  Emergency Clause




EXPLANATION OF AMENDMENTS

Committee amendment #1 further defines community development activities as
those undertaken pursuant to Chapter 373 of the Local Government Code.