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A BILL TO BE ENTITLED
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AN ACT
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relating to the award of compensatory damages caused by certain |
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delays under governmental construction contracts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter Z, Chapter 2252, Government Code, is |
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amended by adding Section 2252.911 to read as follows: |
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Sec. 2252.911. COMPENSATORY DAMAGES CAUSED BY GOVERNMENTAL |
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DELAYS IN CONSTRUCTION CONTRACTS. (a) In this section: |
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(1) "Compensatory damages" means the costs actually |
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incurred by a contractor as a result of delay in the schedule that |
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could not be reasonably mitigated by the contractor. The term does |
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not include: |
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(A) special damages; |
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(B) consequential damages; |
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(C) home office overhead, except overhead costs |
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for labor as defined in the applicable construction contract; |
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(D) profit or markup on indirect costs; |
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(E) the costs of performing additional work that |
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are separately agreed to by the governmental entity and contractor |
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in a construction contract; or |
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(F) indirect costs not related to the project in |
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the applicable construction contract. |
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(2) "Contractor" means a person engaged in the |
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business of developing, constructing, fabricating, repairing, |
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altering, or remodeling improvements to real property. |
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(3) "Governmental entity" means: |
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(A) the state; |
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(B) a municipality, county, public school |
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district, or special-purpose district or authority; |
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(C) a district, county, or justice of the peace |
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court; |
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(D) a board, commission, department, office, or |
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other agency in the executive branch of state government, including |
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an institution of higher education as defined by Section 61.003, |
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Education Code; |
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(E) the legislature or a legislative agency; or |
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(F) the Supreme Court of Texas, the Texas Court |
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of Criminal Appeals, a court of appeals, or the State Bar of Texas |
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or another judicial agency having statewide jurisdiction. |
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(b) A provision of a construction contract between a |
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governmental entity and a contractor may not prohibit the award of |
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compensatory damages to the contractor for a delay to the extent |
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that the delay is caused solely by the governmental entity or by a |
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party for which the governmental entity is responsible. |
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(c) This section does not restrict, limit, or prohibit the |
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inclusion of a contract provision in a construction contract |
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prescribing requirements or conditions that must be met by a |
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contractor to seek recovery of compensatory damages, including |
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requirements or conditions relating to notice, justification, or a |
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duty to mitigate or for demonstrating or proving the actual cost or |
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schedule impact of a delay. |
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(d) This section may not be waived. A purported waiver of |
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this section in violation of this subsection is void. |
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(e) This section does not apply to a construction contract: |
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(1) for services related to recovery or relief from a |
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natural disaster involving the repair or renovation of a residence; |
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or |
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(2) that is subject to Section 201.112, Transportation |
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Code. |
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SECTION 2. Section 2252.911, Government Code, as added by |
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this Act, applies only to a construction contract entered into on or |
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after the effective date of this Act. |
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SECTION 3. This Act takes effect September 1, 2025. |