Honorable Joe Nixon, Chair, House Committee on Civil Practices
FROM:
John S. O'Brien, Deputy Director, Legislative Budget Board
IN RE:
HB2039 by Nixon (Relating to the adjudication of claims arising under written contracts with local governmental entities.), As Introduced
No fiscal implication to the State is anticipated.
The bill would require that a local governmental entity as defined by the bill would waive sovereign immunity to suit for the purpose of adjudicating a claim arising under a contract the entity has entered into for goods or services. The bill would provide certain limitations on adjudication awards. The bill would take effect September 1, 2005 and would apply only to a claim arising under a contract executed on or after that date.
Local Government Impact
If a contract is adjudicated through alternative dispute resolution proceedings, in court, or in an arbitration proceeding, the local governmental entity would incur, at a minimum, legal expenses. If adjudication of the contract results in the local governmental entity paying damages within the limits of the proposed statute, the entity would incur additional costs. Those costs would vary depending on the terms and costs of the contract.