Colorado Construction Legislation Update

by Sherman & Howard L.L.C.
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The 2013 Colorado Legislative Session ended on May 8, 2013.  Although construction issues were not at the forefront, a few bills pertinent to the construction industry did appear and pass this Session.  This advisory provides an overview of the noteworthy construction bills addressed during the 2013 Legislative Session.  

Construction Bills That Passed In The House and Senate

Workers' Compensation-Statutory Employer (Senate Bill 13-147). 
Senate Bill 13-147 seeks to clarify workers' compensation laws for statutory employers.  For purposes of the new bill, a "statutory employer" is an employer responsible to pay workers' compensation benefits as a person or company who leases or contracts out any or all of the work it conducts to a lessee, contractor, or subcontractor and is responsible for paying compensation for injury or death resulting therefrom as set forth in the Workers' Compensation Act of Colorado.  The bill creates a presumption that a buyer of goods is not a statutory employer when a lessee, contractor, subcontractor or their employee who is delivering goods to the buyer injures himself while not on the buyer's premises.  The presumption can be overcome, however, by showing that the lessee, contractor, or employee was performing a job function that would normally be performed by an employee of the buyer of the goods being delivered.  The bill clarifies it does not create a presumption of a statutory employer-employee relationship when an injury occurs on the buyer's premises.  The bill passed in the Senate and on May 7, 2013, the bill passed the third reading at the House.  The bill is awaiting signature by the Governor.

Workers' Compensation Deductible (House Bill 13-1025). 
On April 26, 2013, the Governor signed House Bill 13-1025, which increased the amount of the authorized deductible for workers' compensation insurance policies.  House Bill 13-1025 amends Colorado Revised Statute § 8-44-111(1) to allow an employer to pay "an amount not to exceed the split point approved by the Commissioner of Insurance per claim toward the total amount of any claim payable under" the Workers Compensation Act of Colorado.  The "split point" means "the amount of each loss approved by the Commissioner of Insurance that an insurer may apply as the primary loss in each workers' compensation claim."  Previously, the authorized deductible could not exceed $5,000.  The act takes effect July 1, 2013 and applies to new and renewing workers' compensation insurance policies on or after July 1, 2013.

Architect, Professional Engineer, and Professional Land Surveyor Licensing Law (Senate Bill 13-161). 
This bill concerns the continuation of the State Board of Licensure for architects, professional engineers, and professional land surveyors, and implements recommendations of the 2012 Sunset Report by the Department of Regulatory Agencies.  It also clarifies and updates certain portions of existing statutes pertaining to architects, professional engineers, and professional land surveyors.  After a number of amendments and significant input from AIA Colorado, the bill passed in both the Senate and House.  The bill is awaiting signature by the Governor.  The new licensing law would take effect July 1, 2013.

Keep Jobs in Colorado Act (House Bill 13-1292). 
The General Assembly passed this bill on May 6, 2013.  For more information, see Sherman & Howard's client advisory "The "Keep Jobs In Colorado" Act: Bad for Business, Bad for the State?" distributed on May 7, 2013.

Defeated Legislation

Transit-Oriented Development Claims Act (Senate Bill 13-052).
On April 17, 2013, the much talked-about Transit-Oriented Development Claims Act was defeated when the Senate Committee on Judiciary designated the bill "postpone indefinitely."  Senate Bill 13-052 sought to remedy, in part, the atmosphere of residential and mixed-use construction litigation by enacting legislation that would provide protections for parties involved in the design or construction of multi-family residential or mixed use projects located within one-half mile of any commuter rail, light rail, or bus stop.  The bill instituted a right to repair for construction professionals who received a notice of claim; instituted a binding arbitration requirement; and created immunity from suit arising out of environmental conditions related to transit, public, or commercial use.  With respect to all construction projects in Colorado, the bill also would have clarified that the six-year construction statute of repose does not apply to claims by a party that pays a settlement or has a judgment entered against it and then seeks indemnification or contribution from a third party.  This provision would have been helpful for general contractors.  We anticipate some iteration of this bill will reappear in next year's session.

Construction Prompt Payment Reform Act (House Bill 13-1090)
This bill attempted to codify a Construction Prompt Payment Reform Act that would set forth contractor and subcontractor payment requirements for both private and public construction contracts.  On February 28, 2013, House Committee designated the bill "postpone indefinitely."

Competitive Bidding (House Bill 13-1093)
This proposed legislation sought to require local governments to use competitive sealed bidding for procurement contracts over a certain amount.  The House Committee designated the bill "postpone indefinitely" on February 6, 2013.

If you have questions or would like additional information regarding the bill, please contact attorneys in Sherman & Howard's Construction Law group.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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