| 1 | 1 | | By: Leach, Guillen, Martinez H.B. No. 2265 |
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| 2 | 2 | | (Senate Sponsor - Hughes) |
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| 3 | 3 | | (In the Senate - Received from the House May 8, 2023; |
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| 4 | 4 | | May 9, 2023, read first time and referred to Committee on Business & |
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| 5 | 5 | | Commerce; May 23, 2023, reported favorably by the following vote: |
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| 6 | 6 | | Yeas 9, Nays 1; May 23, 2023, sent to printer.) |
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| 7 | 7 | | Click here to see the committee vote |
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| 8 | 8 | | |
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| 9 | 9 | | |
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| 10 | 10 | | COMMITTEE VOTE |
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| 11 | 11 | | YeaNayAbsentPNV |
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| 12 | 12 | | SchwertnerX |
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| 13 | 13 | | KingX |
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| 14 | 14 | | BirdwellX |
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| 15 | 15 | | CampbellX |
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| 16 | 16 | | CreightonX |
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| 17 | 17 | | JohnsonX |
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| 18 | 18 | | KolkhorstX |
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| 19 | 19 | | MenéndezX |
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| 20 | 20 | | MiddletonX |
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| 21 | 21 | | NicholsX |
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| 22 | 22 | | ZaffiriniX |
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| 23 | 23 | | A BILL TO BE ENTITLED |
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| 24 | 24 | | AN ACT |
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| 25 | 25 | | relating to the award of compensatory damages caused by certain |
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| 26 | 26 | | delays under governmental construction contracts. |
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| 27 | 27 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 28 | 28 | | SECTION 1. Subchapter Z, Chapter 2252, Government Code, is |
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| 29 | 29 | | amended by adding Section 2252.909 to read as follows: |
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| 30 | 30 | | Sec. 2252.909. COMPENSATORY DAMAGES CAUSED BY GOVERNMENTAL |
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| 31 | 31 | | DELAYS IN CONSTRUCTION CONTRACTS. (a) In this section: |
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| 32 | 32 | | (1) "Compensatory damages" means the costs actually |
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| 33 | 33 | | incurred by a contractor as a result of delay in the schedule that |
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| 34 | 34 | | could not be reasonably mitigated by the contractor. The term does |
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| 35 | 35 | | not include: |
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| 36 | 36 | | (A) special damages; |
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| 37 | 37 | | (B) consequential damages; |
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| 38 | 38 | | (C) home office overhead, except overhead costs |
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| 39 | 39 | | for labor as defined in the applicable construction contract; |
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| 40 | 40 | | (D) profit or markup on indirect costs; |
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| 41 | 41 | | (E) the costs of performing additional work that |
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| 42 | 42 | | are separately agreed to by the governmental entity and contractor |
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| 43 | 43 | | in a construction contract; or |
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| 44 | 44 | | (F) indirect costs not related to the project in |
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| 45 | 45 | | the applicable construction contract. |
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| 46 | 46 | | (2) "Contractor" means a person engaged in the |
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| 47 | 47 | | business of developing, constructing, fabricating, repairing, |
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| 48 | 48 | | altering, or remodeling improvements to real property. |
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| 49 | 49 | | (3) "Governmental entity" means: |
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| 50 | 50 | | (A) the state; |
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| 51 | 51 | | (B) a municipality, county, public school |
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| 52 | 52 | | district, or special-purpose district or authority; |
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| 53 | 53 | | (C) a district, county, or justice of the peace |
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| 54 | 54 | | court; |
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| 55 | 55 | | (D) a board, commission, department, office, or |
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| 56 | 56 | | other agency in the executive branch of state government, including |
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| 57 | 57 | | an institution of higher education as defined by Section 61.003, |
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| 58 | 58 | | Education Code; |
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| 59 | 59 | | (E) the legislature or a legislative agency; or |
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| 60 | 60 | | (F) the Supreme Court of Texas, the Texas Court |
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| 61 | 61 | | of Criminal Appeals, a court of appeals, or the State Bar of Texas |
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| 62 | 62 | | or another judicial agency having statewide jurisdiction. |
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| 63 | 63 | | (b) A provision of a construction contract between a |
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| 64 | 64 | | governmental entity and a contractor may not prohibit the award of |
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| 65 | 65 | | compensatory damages to the contractor for a delay to the extent |
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| 66 | 66 | | that the delay is caused solely by the governmental entity or by a |
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| 67 | 67 | | party for which the governmental entity is responsible. |
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| 68 | 68 | | (c) This section does not restrict, limit, or prohibit the |
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| 69 | 69 | | inclusion of a contract provision in a construction contract |
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| 70 | 70 | | prescribing requirements or conditions that must be met by a |
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| 71 | 71 | | contractor to seek recovery of compensatory damages, including |
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| 72 | 72 | | requirements or conditions relating to notice, justification, or a |
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| 73 | 73 | | duty to mitigate or for demonstrating or proving the actual cost or |
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| 74 | 74 | | schedule impact of a delay. |
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| 75 | 75 | | (d) This section may not be waived. A purported waiver of |
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| 76 | 76 | | this section in violation of this subsection is void. |
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| 77 | 77 | | (e) This section does not apply to a construction contract |
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| 78 | 78 | | for: |
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| 79 | 79 | | (1) services related to recovery or relief from a |
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| 80 | 80 | | natural disaster involving the repair or renovation of a residence; |
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| 81 | 81 | | or |
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| 82 | 82 | | (2) the construction or repair of a critical |
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| 83 | 83 | | infrastructure facility, as that term is defined by Section 59.001, |
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| 84 | 84 | | Business & Commerce Code, owned or operated by the governmental |
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| 85 | 85 | | entity or any building, structure, improvement, appurtenance, or |
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| 86 | 86 | | other facility owned by the governmental entity that is necessary |
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| 87 | 87 | | to the operation of and directly related to the critical |
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| 88 | 88 | | infrastructure facility. |
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| 89 | 89 | | SECTION 2. Section 2252.909, Government Code, as added by |
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| 90 | 90 | | this Act, applies only to a construction contract entered into on or |
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| 91 | 91 | | after the effective date of this Act. |
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| 92 | 92 | | SECTION 3. This Act takes effect September 1, 2023. |
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| 93 | 93 | | * * * * * |
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