At Home In Berks Fall 2021 - 52

HBA NEWS
The Pennsylvania Builders Association continues to advocate for builders in legislative
matters that impact building, codes and communities. Below is a list of active priorities with
current legislative bills and actions we're following for you.
Summer Advocacy
Municipal Abuse:
Senate Bill 208: Clarifying Municipal Bonding
Requirements for Property Improvements.
SB208 amends the Municipalities Planning Code to clarify
Section 509 regarding final plat approval and the retention
of posted financial security for improvements. While the
law's intent is to ensure developers have sufficient funds to
complete all required property improvements, the current
language can be misinterpreted to withhold excess funds
that greatly restrict a builder's ability to get bonded for
other on-going projects. Instead of only retaining a bond
of 110% of the value of remaining improvements, some
municipalities have interpreted the law to retain 10% of
the entire original project amount in addition to the cost of
remaining improvements.
Multiple Municipal Engineers:
Four Bill package sponsored by Rep. Zimmerman and Rep.
T. Davis which will require townships of the first and second
class, boroughs, and third-class cities to appoint at least
two engineers through a competitive bid process. The cosponsor
memo is out but the bills have not been introduced
yet. We received early copies of the legislative package and
have provided suggested changes including requiring a
permitee to maintain the same engineer throughout the
entirety of the project, exempting municipalities who have
an in-house employee engineer, and specifically prohibiting
the use of the conflict engineer as one of the two required
engineers.
E-Verify Legislation:
House Bill 1021 creates the Contractor Verification Act, and
the Construction Contractor Verification Account within
the Attorney General's Bureau of Consumer Protection,
effectively moving enforcement of E-Verify from the
Department of Labor and Industry to the Office of Attorney
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AT HOME IN BERKs FALL 2021
General. HB 1021 would require all general contractors
(including new home builders) and all subcontractors who
work on new home construction to register and pay a $500
biennial registration fee to the Bureau. Contractors who
only engage in the business of home improvements would
be exempt from this Act.
The Contractor Verification Act is set up very similar to
HICPA in registration requirements plus the addition of
verification of enrollment in the Construction Industry
Employment Verification Act (Act 75 of 2019 E-Verify). The
bill does allow for nominal business operations, stating that
the bureau may elect to waive a verification renewal for a
construction contractor whose total gross annual receipts
for work as a construction contractor are less than $12,400
per year for both years immediately before the renewal date.
In a practical sense, the limits are equal to 2020's standard
deduction. HB 1021 also creates a title protection stating, " A
person may not hold oneself out or engage in any act as a
construction contractor without satisfying the verification
requirements under this act. "
Anti-Indemnity in Construction Contracts:
House Bill 424 would allow for a limited form of
indemnification, exclusively for losses caused by the
negligence of the indemnifying party (Indemnifier). Any
negligence of the indemnified party (Indemnitee) will
bar a claim for indemnification. Currently, Pennsylvania
does not have an anti-indemnity statute regarding
construction contracts; therefore, Pennsylvania has no
statutory prohibition of broad and intermediate forms of
indemnity. According to the prime sponsor of the bill (Rep.
Stephens R-Montgomery) due to the lack of a Pennsylvania
anti-indemnity statute, many Pennsylvania construction
contractors must accept liability for another party's
negligence when entering into construction contracts.

At Home In Berks Fall 2021

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