Governor Signs Builder Priority Bills into Law
Governor Greg Abbott recently signed three pieces of legislation that were priorities for home builders into law.
House Bill 3492, authored by Representative Lynn Stucky and carried in the Senate by Senator Drew Springer, was Dallas BA’s priority legislation for the 88th Texas Legislature.
Dallas BA teamed with the Texas Association of Builders, who also listed HB 3492 as priority legislation, to secure a bill author and sponsor.
HB 3492 ensures that municipalities and counties base development review and inspection fees on the governmental entity’s cost of performing these services as opposed to the valuation of the plans, project or components being assessed. The legislation also helps ensure transparency.
Under the Texas Constitution, regulatory fees assessed by a municipality that are not proportional to the operating costs of the program for which the fee is charged and that return more than what it costs to run the program in association with the regulation can result in a fee that is an unauthorized occupations tax.
HB 3492 provides methods that will lead to reduced fees which will ultimately be passed on to future home buyers. The law becomes effective on September 1, 2023.
House Bills 2022 and 2024, authored by Representative Jeff Leach and sponsored by Senator Phil King, were the top legislative priorities for the Texas Association of Builders this past session.
HB 2022, which makes the first substantive changes to the Texas Residential Construction Liability Act (RCLA) in 20 years, improves the dispute resolution process by which a builder makes an offer to repair construction defects. HB 2024 helps the homeowner by incentivizing that a written warranty be offered by builders and remodelers in order to reduce the length of the statute of repose for residential construction. If a written warranty is offered, the statute of repose is lowered from 10 to 6 years. If no written warranty is offered, the statute of repose remains at 10 years. This brings Texas in line with many of its peer states that have reduced times in their similar statutes.
Members are strongly encouraged to consult with legal counsel before making changes to contracts, especially the duration of warranties offered. HB 2022 becomes effective on September 1 and HB 2024 is effective immediately.
House Bills 3492, 2022, and 2024 will help address the affordability issues facing homeowners and potential home buyers across the state.