H.B. No. 3485
AN ACT
relating to a contractor's or subcontractor's right to elect not to
proceed with additional work under a contract.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter D, Chapter 2251, Government Code, is
amended by adding Section 2251.0521 to read as follows:
Sec. 2251.0521. UNSIGNED CHANGE ORDER. (a) In this
section:
(1) "Public work contract" has the meaning assigned by
Section 2253.001.
(2) "Subcontract" means a contract between a
subcontractor and a vendor who is providing services under a public
work contract.
(b) A vendor may elect not to proceed with additional work
directed by a governmental entity under a public work contract if:
(1) the vendor has not received a written, fully
executed change order for the governmental entity-directed
additional work; and
(2) the aggregate actual or anticipated value of the
additional work under the vendor's contract terms plus any previous
governmental entity-directed additional work for which the vendor
has not received a written, fully executed change order exceeds 10
percent of the vendor's original public work contract amount.
(c) A subcontractor may elect not to proceed with additional
work directed by a vendor under a subcontract if:
(1) the subcontractor has not received a written,
fully executed change order for the governmental entity-directed
additional work from the vendor; and
(2) the aggregate actual or anticipated value of the
additional work under the subcontractor's subcontract terms plus
any previous governmental entity-directed additional work for
which the subcontractor has not received a written, fully executed
change order exceeds 10 percent of the subcontractor's subcontract
amount.
(d) A vendor or subcontractor who elects not to proceed with
additional work as provided by this section is not responsible for
damages associated with the election not to proceed.
SECTION 2. Chapter 28, Property Code, is amended by adding
Section 28.0091 to read as follows:
Sec. 28.0091. UNSIGNED CHANGE ORDER. (a) A contractor or
subcontractor may elect not to proceed with additional work
directed by an owner if:
(1) the contractor or subcontractor has not received a
written, fully executed change order for the owner-directed
additional work; and
(2) the aggregate actual or anticipated value of the
additional work plus any previous owner-directed additional work
for which the contractor or subcontractor has not received a
written, fully executed change order exceeds 10 percent of the
contractor's or subcontractor's original contract amount.
(b) A contractor or subcontractor who elects not to proceed
with additional work as provided by this section is not responsible
for damages associated with the election not to proceed.
SECTION 3. Section 2251.0521, Government Code, and Section
28.0091, Property Code, as added by this Act, apply only to a
contract entered into on or after the effective date of this Act.
SECTION 4. This Act takes effect September 1, 2023.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 3485 was passed by the House on May 8,
2023, by the following vote: Yeas 138, Nays 2, 1 present, not
voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 3485 was passed by the Senate on May
19, 2023, by the following vote: Yeas 30, Nays 1.
______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor