Housing Lawsuit Bill Stumbles

ESSB 5550 expanding contractor and designer liability for housing projects hit a major roadblock this week. House Speaker Frank Chopp (D-43, Seattle) has publicly stated that he will kill the bill for 2007. He recognized that some of the ideas in the bill may have merit, but they need to be studied more before being implemented. This would indicate that the legislature is likely to create a study committee to work on the issue after the end of the 2007 legislative session, reporting back for action in 2008. For more background on this story visit the Olympian newspaper at: http://www.theolympian.com/125/story/73859.html.

In addition to Speaker Chopp, several other of the House Democrat’s leadership team have voiced concerns about the bill. While the press has focused on the Building Industry Association of Washington, every other group involved with design and construction are opposed the bill, including the AIA/WA. Major insurers testified that they would not be able to provide liability insurance if the bill is enacted. At least on insurer said it would pull out of Washington’s market entirely if ESSB 5550 passes. While the bill did pass out of the House Judiciary Committee yesterday, it now appears to be dead for the year.

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UPDATE: Recent news reports have given more details on a meeting between Speaker Chop and the primary sponsors Representative Brendan Williams (D-22, Olympia) and Senator Brian Weinstein (D-41, Mercer Island). The Seattle Times and The Olympian report that the Speaker has not changed his opposition to the bill as a result of the meetings.

AIA/WA Lobbies Against Housing Lawsuit Bill

The House Judiciary Committee held a hearing today on Engrossed Substitute Senate Bill 5550 to create a new avenue for lawsuits on residential construction by creating what is termed a “home warranty.” Under this warranty different parts of a residence would be warranted to be free of defects for up to 10 years (see previous posts).

Mort James, AIA, of Morton Safford James III AIA Architects in Olympia, attended the hearing to testify against the bill on behalf of the AIA Washington Council. Unfortunately, due to time constraints, he was unable to testify.

Mr. James was to testify about his extensive experience in residential construction and concerns about creating a new avenue for lawsuits, which would drive up home prices and not prevent construction defects. The AIA/WA will follow-up with committee members with written comments for the record.

The AIA/WA understands the concerns about faulty residential construction and supports the provision in ESSB550 to create a study committee to analyze the problems in residential construction.

The AIA is further concerned that ESSB 5550 does an end run around the state’s current 6-year statute of repose and 3 year statute of limitations by creating this new warranty. It explicitly creates a new 10-year statute of repose and a 6 year statute of limitations for purposes of the warranty provisions. Repose is the time in which a defect must be found. Limitations are the time after a defect is found or should have been found that a lawsuit must commence.

The AIA/WA also supports efforts to increase qualification standards for contractors and improving efforts to more closely regulate contractors. To that end, the AIA/WA is supporting Substitute House Bill 1843 improving contractor registration provisions and Engrossed Substitute SB 5788 creating a new license requirement for home inspectors.

You can listen to the hearing at www.tvw.org. Enter the bill number 5550 in the search engine and select the House Judiciary Committee hearing on March 23, 2007.

House Hearing on the Use of Reclaimed Water

The House Agriculture and Natural Resources Committee heard testimony on a bill to promote the use of reclaimed water, Engrossed Second Substitute Senate Bill 6117. It makes several important changes to promote the use of reclaimed water. First, it makes it easier for wastewater treatment facilities to put reclaimed water to a positive use in replacing potable water use. It also exempts the reuse of reclaimed water by such a facility from water rights laws, thus not penalizing the entity for using reclaimed water.

The bill also seeks to speed rulemaking on a bill that passed last year, Engrossed Substitute House Bill 2884, by creating a new stakeholders committee and issue specific subcommittees. Local governments would also have the ability to require water conservation measures or the use of reclaimed water in when approving a short plat, short subdivision or subdivision. Finally, it directs the state Department of General Administration to conduct a pilot program to use reclaimed water on the Washington Capitol Campus in Olympia.

The AIA/WA singed in support of the bill at the hearing.

Hearing on Bill Affecting Schools’ Capital Projects Funds

The Senate Early Learning and K-12 Committee heard testimony on Second Substitute House Bill 1280, allowing school districts to use capital project funds for fees for “…the ongoing fees for online applications and licensing of software, including upgrades and incidental services, and ongoing training related to the installation and integration of these products and services.”

The AIA/WA testified against this bill citing concerns that it authorizes the use of funds for purposes that are inconsistent use of capital project funds. Ongoing software fees and training should be funded through operating budgets.

The AIA/WA does not dispute the importance or the need for funds for technology needs. However, it is inappropriate to place the funding mechanism for software licenses, online subscriptions and ongoing training in the section of the statute reserved for the capital projects fund.

It would be more appropriate to pay for software licenses and ongoing training through a maintenance and operations levy or through a dedicated technology levy.

Legislative Deadline Stops Anti-Vesting Bill

SB 5507 to significantly alter the laws for vesting projects under state law failed to pass a key step and died when the Senate adjourned yesterday. The AIA/WA had been actively lobbying against the bill and had gained key allies in legislature. On March 8, at an AIA/WA briefing, Governor Chris Gregoire expressed serious concerns about the bill and pledged to work with the design and construction community to stop the bill if it passed the Senate. A companion measure in the House was stopped in committee earlier this year.

Senate Adjourns Early Amid Wrangling on Simple Majority

In an unusual move, the Senate adjourned almost 2 hours before the 5 p.m. deadline on Wednesday. Senator Joe Zarelli (R-18, Ridgefield) moved to bring SJR 8207, simple majority for school levies, back to the floor. That move took precedent over other matters before the Senate. The Republicans had intended to provide enough votes to pass the measure out of the Senate and had informed the Democrats of that fact. However, the Senate Democrat leadership unexpectedly moved to adjourn rather than have another vote on SJR 8207.

The House version, HJR 4204, passed earlier in the week. Senate Majority Leader Lisa Brown stated that she intends to move the house bill.

The Daily Olympian and the Vancouver Columbian have additional coverage of the story.

NOTE: This report has been updated to clarify the circumstances around the Senate’s early adjournment.

Certificate of Merit Bill Dies in the Senate

The AIA-backed bill requiring a certificate of merit for design professionals, SB 5833, died today when it failed to pass the Senate. The AIA/WA had been working very hard to get the bill brought to the Senate floor before the deadline today for bills to pass out of their house of origin.
The AIA/WA thanks all of its members who contacted their Senators in support of the bill in the past week. While the bill hit a barrier this year, we will look to bring it back in the 2008 Legislature.

Seattle Voters Reject Waterfront Highway Options

On Tuesday, Seattle voters rejected both highway options for replacing the failing Alaska Way Viaduct on State Route 99. Two options were put before the voters to vote “Yes” or “No” on an elevated highway or “Yes” or “No” on a tunnel highway to replace the viaduct. The votes so far are 70% against the tunnel and 55% against the elevated option.

Governor Chris Gregoire held a press conference today with Seattle Mayor Greg Nickels, King County Executive Ron Sims and legislative transportation committee leaders on the next step. The governor laid out a plan that mirrors the proposal put forward by the AIA/WA.

AIA/WA’s proposal for the viaduct replacement includes:

• Create a public facilities district (PFD) to move the project forward. The state should take this project out of WSDOT’s hands and put it into the hands of an agency that can take a larger view of the problem and can represent a broader set of interests.
• Immediately implement transit enhancements, surface street improvements and other mitigation projects.
• Once the traffic mitigation is in place, demolish the viaduct and remove the public safety hazard.
• Create a new design for the waterfront. While the mitigation and demolition are occurring, there will be time to thoroughly evaluate new options for moving people into and around in the City of Seattle.

The Governor’s $900 million plan, which had the support of the other officials at the press conference, includes:

• Develop a collaborative process for bringing the government stakeholders together on a common plan.
• Begin safety repairs on the viaduct to stabilize it until its target demolition date of 2012.
• Utility relocation that can be accomplished immediately.
• Improvements to the Battery Street Tunnel and at Lenora and Battery Streets
• Transit and arterial improvements

Seattle Mayor Nickels, for his part, said he heard a clear message from the voters to not build another highway on the waterfront. He said that he will no longer push his proposal for a tunnel and will continue to oppose the building a new elevated highway.

Other than general comments, there were not details on what the ultimate replacement design may include. The speakers were careful to avoid committing to a plan, instead referencing the new collaborative process that will be developed.

Construction on the mitigation and related projects will begin this summer. The “collaborative process” will not begin until after the legislature adjourns on April 22, 2007.

Overall, the vote and elected leaders’ comments validate the position the AIA has developed on the Viaduct replacement. We will continue to work closely with city, county and state elected officials on the plan.

AIA Seattle and its leadership are to be congratulated for their role in the election and their continuing leadership on the replacement process.

Senate Passes Structural Engineer Practice Act

Today, the Senate passed Substitute SB 5984 to require engineers who practice structural engineering to be licensed as a structural engineer. The vote was 36-11. A few senators objected to the increased stringency required in the bill. This bill has been developed by the Structural Engineers Association of Washington in cooperation with the AIA/WA and other professional design groups over the past two years.

House Passes Tougher Contractor Registration Requirements

Substitute House Bill 1843 to toughen registration requirements for contractors in Washington State passed the State House last night. It gives the Department of Labor & Industries greater authority to deny and suspend registration to contractors who have violated the law in the past. It also would require larger bonds from contractors who have had successful lawsuits against them in the past five years. SHB 1843 further gives L&I greater investigative authority, including the ability to obtain a search warrant to enter a job site to investigate potential violations. All of the major residential and commercial contracting groups testified in support of the bill during the committee hearing.

House Passes Alternative Public Works Reauthorization

The House unanimously passed Second Substitute House Bill 1506 reauthorizing the state’s alternative public works laws. These laws allow certain government agencies to use design-build, general contractor/construction manager (GC/CM) and job order contracting. The bill would allow additional agencies to use design-build and GC/CM under strict supervision by a new “Project Review Committee.” The AIA/WA worked as part of a stakeholder process for nearly two years on the reauthorization to make improvements to the laws.

House Passes Simple Majority for School Levies

The House debated and passed Engrossed House Joint Resolution 4204 today to send to the voters a Constitutional amendment eliminating the supermajority voter requirement for excess property levies for school districts. The vote was 79-19. Current law requires that such levies must be approved by more than 60% of the voter turnout must be equal or greater than 40% of the turnout in the last general election. This is the companion bill to the senate measure, Engrossed Substitute SJR 8207 that failed to pass the Senate earlier this session. The bill was amended on the House floor to clarify that that the voter-turnout requirement in the current law does not apply to maintenance and operations levies. EHJR 4204 now goes to the Senate for further consideration. If it passes both bodies it would go before the voters in November 2007 and need a simple majority of voters to be adopted.

Senate Passes Home Inspector Licensing Bill

The State Senate passed Engrossed Substitute Senate Bill 5788 to create a new licensing requirement for home inspectors. The AIA/WA worked with the sponsors to get amendments added to exempt architects and engineers from the requirements and to move the program from the Department of Labor & Industries to the Department of Licensing. The AIA/WA supports the amended bill. An architect or engineer would not be exempt from the separate statute requiring licensing of pest inspectors.

Senate Passes Environmental Bills

The State Senate took up and passed several environmental bills today.

The highest profile bill was Substitute SB 6001 addressing global warming. The bill establishes state goals for reducing greenhouse gases and promotes the use of cleaner energy.

Also passing today was Second Substitute SB 6117 promoting the use of reclaimed water. Reclaimed water is part of the AIA/WA’s water conservation focus.

Engrossed Substitute SB 5372 establishes the Puget Sound Partnership as a new state agency focused on cleaning up Puget Sound. The bill sets a goal of attaining a healthy Puget Sound by 2020. While there are many bills dealing with water quality, ESSB 5372 sets the overall regulatory framework to coordinate efforts.

The Energy Freedom Program was enacted in 2006 to promote the development of renewable energy resources in the farming industry. These efforts include the conversion of farm waste into energy. SB 5383 expands the program to include wind power projects owned by community action agencies in the state.

SB 5421 adopts The Uniform Environmental Covenants Act (UECA). Environmental covenants control future use of contaminated land to ensure it that it is appropriately developed. The UECA ensures that environmental covenants remain legally valid over the long term. Adoption of the UECA is an important step in the future redevelopment of brownfields and other contaminated sites.

Bill Circumventing Statute of Repose Passes Senate

A bill that would undermine the state’s statute of repose for designers and builders of residences passed the State Senate late yesterday on a 30-19 vote. SB 5550, sponsored by Senator Brian Weinstein (D-41, Mercer Island), creates a new “warranty” requirement for residences. The warranty would be up to 10 years for certain aspects of a residence – nearly doubling the current 6 year statute of repose. The bill does not directly alter the statute of repose, rather it creates new legal rights to sue builders and designers beyond the current 6 year limit. While AIA/WA and its allies were successful in getting the bill narrowed before it came to a vote in the Senate, we remain very concerned about the negative impact the bill would have on housing prices and the availability of professional liability insurance for those that design and build houses.

The bill now goes to the House of Representatives where it will be referred to the House Judiciary Committee. A companion bill, HB 1935, sponsored by Representative Brendan Williams (D-22, Olympia) remains pending on the House Second Reading Calendar.

Capitol Connections – Delivering Results

Architects from all areas of Washington came spent the day at the Capitol Building in Olympia educating lawmakers about the impact of legislation on the practice of architecture. Architects top priorities included: passing a certificate of merit (SB 5833) , passing a Constitutional amendment for simple majority on school levies (HJR 4204/SJR 8207), stopping a bill to radically alter vesting rights under codes and regulations (HB 1463/SB 5507) and creating a better vision for Seattle’s waterfront by permanently removing the elevated viaduct on Alaska Way. For more information on these issues visit www.aiawa.org and view the issue briefs.

Capping off a successful day of legislators meetings, architects had a private briefing by Governor Chris Gregoire. Governor Gregoire discussed her proposals for improving the business climate in Washington State. After being asked her position on the anti-vesting bill, she stated her opposition to the bill and pledged to work to defeat the bill if it gains further momentum in the legislature.

To view the status of all of the bills that the AIA/WA is tracking this legislative session, visit our website at www.aiawa.org and select “Legislative Tracker 2007.”

Action Alert Issued on Certificate of Merit Bill

The AIA/WA has issued an all member Action Alert on the Certificate of Merit Bill, SB 5833. The alert was issued through the AIA Advocacy Center and calls on AIA members to contact their Senators to support SB 5833. The bill must pass the full Senate by March 14, 2007, or it is dead for the year. As previously reported, the bill is now in the Rules Committee, which decides the bills that will move the Senate floor for a vote. It is critical that SB 5833 move to the floor quickly before the next deadline on March 14.

To take action today, visit the AIA Advocacy Center and click on “Contact Your State Officials” for the alert, talking points on the bill and additional information on how to contact your individual senator.