(8)(c)
CITY COMMISSION REGULAR MTG
- Meeting Date:
- 02/19/2025
- Title:
- Consider and take action on the first reading of Ordinance 2025-XX, amending the Texas City Code of Ordinances Title XV "Land Usage", Chapter 150 "Building Regulations; Construction"; and Chapter 151 "Electricity" and Chapter 153 "Mechanical Regulations"and Chapter 154 "Plumbing" to require insurance and a surety bond
- Submitted For:
- Kim Golden
- Submitted By:
- Curt Kelly, Transportation and Planning
- Department:
- Transportation and Planning
Information
ACTION REQUEST
Consider and take action on the first reading of Ordinance 2025-XX, amending the Texas City Code of Ordinances Title XV "Land Usage," Chapter 150 "Building Regulations;Construction"; Chapter 153 "Mechanical Regulations"; and Chapter 151 "Electricity" and Chapter 154 "Plumbing" to update the building permit requirements for insurance and surety bond.
BACKGROUND (Brief Summary)
The Texas City Code of Ordinances currently requires all contractors and builders undertaking projects that involve the construction, erection, or repair of buildings which necessitate a permit to maintain liability insurance in the amount of $300,000 and to the City as the certificate holder to ensure proper accountability and risk management. The proposed ordinance increases the amount of insurance to $1,000,000 as recommended by the City Attorney.
Current provisions allow a contractor to provide a surety bond in the amount of $5,000 instead of the liability insurance. This provision needs revision because a bond is not the same as insurance and does not cover a contractor's liability. To protect the public and homeowners, contractors should provide insurance and a surety bond. It is recommended that the bond amount be a minimum of $10,000. The surety bond serves as a financial guarantee for the completion of the project in accordance with local laws and standards and building code. The proposed ordinance requires approval of the surety bond form by the City Attorney to ensure its compliance with all legal requirements.
Current provisions require a licensed plumber to provide insurance in the amount of $300,000. The proposed ordinance increases this amount to $1,000,000 as recommended by the City Attorney.
Current provisions do not require the posting of a surety bond by plumbers, HVAC/mechanical contractors or electrical contractors, or the provision of insurance by HVAC/mechanical contractors or electricians as conditions for the issuance of plumbing, HVAC/mechanical or electrical contractors. The proposed ordinance adds a requirement for licensed plumbers, HVAC/mechanical contractors and licensed electricians to provide $1,000,000 in liability insurance and a surety bond in the amount of $10,000.
Current provisions require a licensed plumber to provide insurance in the amount of $300,000. The proposed ordinance increases this amount to $1,000,000 as recommended by the City Attorney.
Current provisions do not require the posting of a surety bond by plumbers, HVAC/mechanical contractors or electrical contractors, or the provision of insurance by HVAC/mechanical contractors or electricians as conditions for the issuance of plumbing, HVAC/mechanical or electrical contractors. The proposed ordinance adds a requirement for licensed plumbers, HVAC/mechanical contractors and licensed electricians to provide $1,000,000 in liability insurance and a surety bond in the amount of $10,000.
RECOMMENDATION
The City Engineer, Chief Building Official, and other City staff recommend approval of Ordinance 2025-XX, which amends Chapters 150 ("Building Regulations"), 151 ("Electricity"), 153 ("Mechanical Regulations"), and 154 ("Plumbing"). to require minimum insurance coverage of $1,000,000, with the City of Texas City designated as the insured party and a surety bond of $10,000 as a condition for the issuance of building permits to licensed contractors, plumbers, HVAC/mechanical contractors and electricians for work performed in Texas City.