2011 Session Summary (Updated!)

In previous ADVOCACY blogs, we reported that all our priority bills had passed so, barring a veto from Governor Perry, they would become law. We’re delighted to say that, for the first time in four sessions, the Governor didn’t veto a single bill we identified—and supported—as architectural practice priority. Since we previously described those priority bills in some detail, this report will focus more on when those changes become effective, etc., as well as providing a link to more detailed information, including a link to the Enrolled version of each bill. (Click on bill numbers in the sub-titles.) In reverse numerical order, they are:

HB 2284 (see May 25, 27 and June 6 blogs)

Summary—A/E “Peace Accord” bill that settles 20+-year scope-of-practice disputes between the professions. In trade for creating a process by which certain licensed engineers can be “grandfathered” (between September 1, 2011 and January 1, 2012) to continue practicing architecture without an architecture license, language was added to the Engineering Practice Act stating that an architect must prepare the architectural plans and specifications for any building intended for human use or occupancy, as well as “the practice of engineering does not include the practice of architecture.”

Effective Date—September 1, 2011

Exemptions or Exclusions—See those previously reported on the TSA Blog regarding an engineer’s eligibility to apply for “grandfathering.”

HB 2093 (see May 25 and 27 blogs)

Summary—Makes broad-form indemnification clauses “void and unenforceable.” In other words, as a matter of public policy, after the effective date most contracts will require each party to be responsible for its own acts, and will not allow one party to dictate to another that a “second party” must indemnify and defend the “first party” against the first party’s acts of negligence. The “void and unenforceable” limitation also extends to any requirement to purchase additional insurance for such indemnification contingencies.

Effective Date—January 1, 2012

Exemptions or Exclusions—Specific classes of exempted construction contracts include residential (single family house, townhouse or duplex, including any related land development) and municipal projects. In addition, language for common or current exemptions such as bodily injury or death of an employee, breach of contract, general indemnity agreements required by sureties or in loan or financing documents, general “benefits and protections” language under state workers comp or governmental immunity laws, etc., are included.

HB 1728 (see May 25 and June 7 blogs)

Summary—Establishes parameters for energy-performance or energy-conservation contracts, including available sources of funds to pay for them. Of particular interest to architects is the language limiting K-12 public education entities from disallowing “proper allocation” of available tax credits added to Section 44.902 of the Education Code (See page 3). Similar language for other public entities is found in HB 51.

Effective Date—September 1, 2011

Exemptions or Exclusions—None

HB 628 (see May 25 and May 27 blogs)

Summary—Consolidates the language dealing with Alternative Project Delivery methods now found in three different codes (Education, Government and Local Government) into a single chapter of the Government Code. It also provides a bit of needed tort reform by requiring that money received by a school district as the result of a construction-defect lawsuit—regardless whether a settlement or verdict—be spent to fix the problem for which the lawsuit was filed.

Effective Date— September 1, 2011

Exemptions or Exclusions—While the bill has almost universal impact on all public entities, there are notable exceptions like the Texas Department of Transportation and institutions of higher learning (although community and junior colleges are included).

HB 51 (see May 25 and June 7 blogs)

Summary—Requires state buildings to be designed and constructed or renovated to achieve certification under a nationally recognized program such as LEED or Green Globes, or a comparable program developed by a municipally owned energy producer. Also includes language that says a design professional’s services to achieve such third-party certification are not to be considered “basic services,” and that public entities may not disallow proper allocation of potential tax credits. (See page 5, lines 15-24 of the bill.)

Effective Date—September 1, 2011

Exemptions or Exclusions—Higher education buildings may be exempted in cases where the governing board has already adopted another, reasonably equivalent, set of energy-conservation standards, or requests and is granted an “undue hardship” waiver from SECO, which includes providing documentation demonstrating need for the waiver. Also, buildings for which a Higher Ed entity advertises seeking RFQs, RFPs, bids, etc., before September 1, 2013 are exempt. Only their buildings or projects initiated after that date are covered. For state buildings, the effective date is September 1, 2011.

Advocacy Update

David Lancaster

TSA Senior Manager of Advocacy

After every session, there is a 20-day “post-session review period,” in which the Texas Governor can 1) veto, 2) sign into law, or 3) let become law without signature any bill that was passed during that Regular Session. While waiting for the 2011 period to run its course, here are some additional comments in response to questions that have already been raised about two bills mentioned in our May 25 and May 27 Advocacy Updates blogs, and/or the most recent CheckSet article.

After this year’s constitutional “veto period” ends, we’ll post a more comprehensive “final action” report about bills that were on TSA’s Legislative Tracking System, including descriptions of some “non-bill” lobbying activities (like working to defeat bad amendments to good—or at least benign—legislation) that we believe helped to advance or protect the profession.

HB 2284
The potential for a “grandfather” opportunity for engineers mentioned in June’s CheckSet article is much different from the one that came with passage of the interior designer title act in 1991. Because so many architects were grandfathered 20 years ago under that earlier law, several called or wrote asking for more detail, or at least clarification, about the difference or similarities between the two situations.

For an engineer to be granted a waiver by TBAE, he or she must offer documentation that they prepared the architectural plans and specifications for at least three projects that exceeded the threshold where an architect would be required. That application and documentation process must occur between Sept. 1, 2011, and Jan. 1, 2012. The Board of Architectural Examiners must determine during that time whether or not the projects are eligible or not, and if the projects were built "safely and adequately." (The TBAE decision is appealable to the State Office of Administrative Hearings.)

Contrast that with 1991 when, because all architects were exempt under that new title (as opposed to practice) law, they had two years in which to do so. All that was necessary was that an architect file the required paperwork asking to be jointly recognized and registered as an Architect and Interior Designer.

One of the most important elements of HB 2284 is the wording that, while architecture and engineering may be closely related...while they even have significant areas of overlap, the two professions are sufficiently different that the legislature had reason to put into statute that engineers may not prepare all the plans and specifications for a building intended for human use or occupancy; architects must be involved in those projects, too.

That clarification – that the practice of engineering does not include the practice of architecture – is what has been sought for many years. Given this clarification, our part of the negotiations centered on how to develop the best, most responsible "prove up" grandfathering process to qualify the number of engineers who might make it onto TBAE's “exempt list.”

HB 51/HB 1728
We’ve received numerous calls from optimistic members (or their accountants) about the “IRS Code, Section 179D” tax credit potential in both these bills, so here’s more helpful detail from the AIA national headquarters. (Note: there are two hyper-links embedded in the AIA article below, including one to a webinar on the topic. If you have questions that still can’t be answered, contact Christina Finkenhofer at christinafinkenhofer@aia.org or call her 202/626-7478.)

*179D Energy Efficient Commercial Buildings Tax Deduction

Advocacy Update: Week 8

Yvonne Castillo

TSA General Counsel

This week was about engineers filing numerous bills to expand their business opportunities to include architecture. It’s not enough that engineers are authorized to prepare mechanical, electrical, structural, and civil plans and specifications for buildings…they want it all, and are pushing very hard to change the law to give them the authority to prepare architectural plans for public buildings. It’s shameful really, but we have a plan that we’ve already implemented and we’ll be calling on all of you to help us implement it further at the grassroots level when appropriate. The architectural community should take note that the favorable Travis County District opinion has ramped up the engineers’ efforts in this regard.

We also spent a great deal of time negotiating with roofing contractors and others on the alternative project delivery bill that was simply intended to consolidate alternative project delivery methods. Everyone has come out of the woodwork this Session on this bill (despite its successful passage for two legislative sessions) and it’s looking like the bill is going to be boiled down to a very basic version.

Lastly, we supported a couple of bills: HB 611 that prohibits state agencies from using their own staff to provide “commercially available” architectural or engineering services on projects they do not own and HB 51 that promotes high performance standards for schools and state agencies.

Advocacy Update: Week 7

David Lancaster, Hon. AIA
TSA Senior Director of Advocacy

The current major issues of legislative focus are all “red meat” topics like abortion, voter ID, and immigration reform. They are extremely partisan, and there are two theories of how dealing with such topics now will ultimately affect the session:

1. They will either satisfy the needs of legislators for voting on hot-button issues (thought to be especially important to recently elected, Tea Party-backed members), thus freeing them to be more reasonable on more critical issues—especially the budget—that are to follow; OR

2. They will create complete, not-to-be-healed acrimony and split the House so badly that nothing will get done the rest of the session, and lead to multiple Special Sessions.

One particular interesting thing that caught my attention this past week, however, is Sen. Bob Deuell (R-Greenville), a leading conservative Republican, recently said that the state will need to spend most of the Rainy Day Fund this session to deal responsibly with the budget shortfall and the Legislature will need to raise taxes, not just to generate more revenue, but to provide more equity on service taxes, which I’ll paraphrase as “cutting grass vs. cutting hair.” His example, which stayed away from taxing professional services (I should mention, coincidentally, that he is a physician), was to say the company that he has contracted to maintain his lawn collects sales tax for that service while the woman who cuts his hair doesn’t.

So what does this have to do with you or your practice? Not that much, although when someone with the conservative Republican props like Senator Deuell says we need to look at taxes, especially taxes on services, we all need to pay extra attention. Here are some of the bills or specific activities of impact/interest to architects and architecture that staff and lobbyists were busy with this week—

HB 51—High Performance Standards for K-12 facilities….had a State Affairs committee hearing on Wednesday. We were there in support and continue to assist actively as requested.

HB 628—Alternative Project Delivery and Public Contracting Procurement…was heard Thursday by the Government Reform committee. Again, we were there in active support because it’s one of our priority initiatives, along with High Performance Building bills.

HB 362 and 450—Regulation of Solar Panels by Home-Owner Associations…had their first Business & Industry committee review. Everyone seems to love the concept of solar energy and energy conservation, but legislators are sensitive to anything “ugly” that would reduce residential or community property values. SB 238 enjoyed a similar reaction with the Intergovernmental Relations committee across the rotunda on Wednesday.

HB 611—Provision of certain professional services…would limit public entities from providing design and construction services except on projects they own or have a shared interest ion. We offered the bill’s author an amendment for some “Except project management” language that might be misinterpreted or, worse, misused by a public entity looking for non-tax revenue.

Some interesting bills that were filed this week include—

HB1618—a Sunset Review bill…but one that appears to be a possible vessel for legislative “mischief”—if someone wanted to try something sneaky. At the least, one can’t help but read this as anything but a shot at one agency in particular, the Board of Architectural Examiners.

HB1876—Fire sprinklers in 1-2 family residences, the ubiquitous question of balance between safety-financial-maintenance liability concerns.

SB 1048—Public-Private Partnerships…viewed as a potential (and based on the current budget situation, an increasingly popular) source for funding capital projects. This large, complex bill was reported yesterday and will take time to digest, and the Government Affairs Steering Committee knows it must carefully consider a multitude of facets if we are to avoid potential unintended consequences.

And, finally, negotiations on the A/E issue are progressing, with our next meeting likely to be Monday. The situation is extremely fluid…so stayed tuned on a daily basis.

Last Day to Register for Advocates for Architecture Day

Just a reminder that registration for Advocates for Architecture Day ends today, Friday, December 17th.

Please register now and be the voice for Texas architecture at the State Capitol on January 25, 2011.

On Monday, TSA will start going through the registrants and begin the process of organizing and scheduling appointments. Anyone not registered by 11:59pm on December 17th will not be scheduled for legislator appointments.

Join Advocates for Architecture at the Texas Capitol

Texas Society of Architects

Advocates for Architecture Day

Tues. January 25, 2011

Texas State Capitol

WHY SHOULD I ATTEND Advocates for Architecture Day?

Texas is facing a HISTORIC budget deficit of $25 BILLION, which is a 1/4 of the overall budget. This means budget cuts will be drastic and revenue sources will be desperately sought!

• What if architects were procured by price instead of qualifications?
• What if K-12 schools are forced to choose from state standardized architectural plans?
• What if sales taxes (8.25%) were imposed on your professional services?
• What if occupation fees were raised?

REGISTER NOW and be prepared to tell your story. Registrations must be received by December 17th!

GET ON THE BUS!

AIA Dallas is sponsoring a bus trip to the Texas State Capitol on January 25th, departing at 5:00 am from the Dallas Design District.

AIA Houston, AIA Fort Worth, and AIA San Antonio will also have bus transportation. Contact your chapter to RSVP for a seat.

WHAT TO EXPECT:

Training will begin on Tuesday, January 25th at 9:00 am at the AT&T Conference Center/hotel (room TBD) within blocks of the Capitol. The morning will be spent learning what our issues are, how to communicate them to policymakers, and some political insight to the Legislative Session. You supply the passion for your profession and we'll supply all the basic skills, tools and information you'll need to be able to confidently approach Texas legislators and articulate the issues that affect architects statewide. Box lunch will be provided immediately following training.

After lunch, we will all meet at the Capitol (location TBD) for a group photo then we'll head down to our reserved briefing room at the Capitol (TSA's unofficial office) to pick up your materials, leave-behinds and talking points. Visits will be scheduled from 1:00 -- 4:00 pm in the afternoon. Once you're done, head back to our Capitol office to let us know how your meetings went and to fill out personal thank you notes to be sent to your legislators. We expect everyone to be done between 4-5:00 pm, at which point you can spend some time touring the Capitol or head back home, with the thanks of TSA and all Texas architects.