Bill Text: TX SB1980 | 2017-2018 | 85th Legislature | Engrossed


Bill Title: Relating to performance bonds for certain public improvements in certain municipalities.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Engrossed - Dead) 2017-05-16 - Referred to Business & Industry [SB1980 Detail]

Download: Texas-2017-SB1980-Engrossed.html
 
 
  By: Schwertner S.B. No. 1980
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to performance bonds for certain public improvements in
  certain municipalities.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 212.073, Local Government Code, is
  amended to read as follows:
         Sec. 212.073.  PERFORMANCE BOND; LETTER OF CREDIT.
  (a)  Except as provided by Subsection (b), the [The] developer must
  execute a performance bond for the construction of the improvements
  that are the subject of the contract under Section 212.071 to ensure
  completion of the project. The bond must be executed by a corporate
  surety in accordance with Chapter 2253, Government Code. The
  amount of the bond must be for the contract price for the
  improvements. The municipality may not require the developer to
  include in the amount of the bond any other improvement related to
  the development that the developer did not contract with the
  municipality to construct under Section 212.071.
         (b)  The municipality and developer may agree that, instead
  of a performance bond under Subsection (a), the developer may
  submit to the municipality an irrevocable letter of credit in the
  amount required under Subsection (a) for the bond. As part of the
  agreement, the municipality may not pay any amount to the
  developer, issue a building permit related to the development other
  than a permit necessary for the improvements that are the subject of
  the contract, or approve a subdivision plat for the developer
  until:
               (1)  the improvements are:
                     (A)  complete; or
                     (B)  in the final phase of construction if the
  improvements are constructed in phases; and
               (2)  the developer has submitted to the municipality an
  affidavit stating that the developer has paid all costs associated
  with the construction.
         SECTION 2.  Section 212.073, Local Government Code, as
  amended by this Act, applies only to a contract entered into under
  Section 212.071, Local Government Code, on or after the effective
  date of this Act. A contract entered into under Section 212.071,
  Local Government Code, before the effective date of this Act is
  governed by the law applicable to the contract immediately before
  the effective date of this Act, and that law is continued in effect
  for that purpose.
         SECTION 3.  This Act takes effect September 1, 2017.
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