HB 1966

84(R) - 2015
House Business & Industry
House Business & Industry

Vote Recommendation

  • Negative
  • Positive
  • Neutral
  • Neutral
  • Neutral


James Keffer


Joe Deshotel
Jeff Leach
Paul Workman

Bill Caption

Relating to an account or bond for construction retainage under certain contracts.

Fiscal Notes

No significant fiscal impact is expected. 

Bill Analysis

HB 1966 would require the property owner/general contractor to either set aside money in a trust fund or purchase a bond in order to ensure payment for a project in which the property owner has a retainage to pay the remainder of the project cost. This legislation would ensure that the contractors who supply labor and materials for the project get fully paid in the event the general contractor or property owner defaults. 

Vote Recommendation Notes

This is an imperfect solution to a government created problem. By interfering in the free market in the first place, the government set up the present situation that puts subcontractors in an economically disadvantaged position in the event of a general contractor's bankruptcy. HB 1966 would further interfere with free-market interactions by increasing government regulations to fix the problem it created in the first place.

On the other hand, this legislation does have some property rights benefits for the subcontractors in the event that their general contractor does suffer bankruptcy. 

Balancing the free market infringement against the property rights benefits to subcontractors, we are neutral on this legislation.