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House Interim Committee on Business and Industry
Charge

Study lien laws and other relationships involved in construction contracts, including hold harmless agreements, mechanics' and materialmen's liens, loan documentation, lien releases, prompt pay, pay-if-paid and builder licensure.
Background

The Committee on Business and Industry was asked to address problems in the residential construction industry. Problems include: using funds from one project to finance another; failing to adhere to draw schedules; abandoning the construction of a residence under contract; and failure for contractors to pay subcontractors-forcing the subcontractors to place liens on the homeowner.
Recommendations

  • Establish criminal penalties for the intentional filing of an invalid lien.

  • Require builders and contractors to obtain a lien waiver (release) when paying subcontractors and suppliers, and require profit-making lenders involved to obtain waivers.

  • Require more comprehensive disclosures by builders, contractors, lenders, and title companies to consumers about their rights, obligations, and liabilities.
    Charge

    Study issues relating to the public support of sports facilities for economic development.
    Background

    Significant competition for sports franchises has led to a proliferation of proposed new stadium and arena financing throughout the United States and Canada. The focus on building new sports facilities is taking place in the context of constrained budgets and competing fiscal pressures.
    Recommendations

  • Any sports facility legislation should not commit state dollars to projects or funding mechanisms.

  • Allow additional funding flexibility for local governmental entities to raise revenue for facility financing, and mandate local voter approval for all projects and funding mechanisms.