Michael L. Sullivan 2016-01-29 01:13:41
The Georgia General Assembly began its 2016 legislative session on Monday, January 11 and even before it began, legislative leaders were already signaling that this year's session would move at a breakneck speed. This is due to the combination of two factors. First, qualifying for the 2016 elections takes place from March 7-11 and all members of the General Assembly are up for re-election in 2016 (several also already have opponents who have announced their intention to run). Second, members of the General Assembly are prohibited from soliciting or receiving campaign contributions during the legislative session and this restriction does not apply to their challengers. Obviously, legislators in contested races are going to be eager to complete their legislative business as quickly as possible so that they can begin campaigning and fundraising. This kind of pedal-to-the-metal pace means that any legislation viewed as not absolutely essential, or without a significant head of steam behind it, will be difficult to get passed as legislators try to focus their attention on the things they “have” to get done this year. These include the amended Fiscal Year 2016 budget, the Fiscal Year 2017 “big” budget and major legislative initiatives of the Governor, Lt. Governor and Speaker. Anything else is subject to being viewed as something that could “wait till next year.” Nevertheless, the engineering industry will be focused on trying to pass two pieces of legislation intended to improve the business climate for engineering in Georgia. INDEMNIFICATION LEGISLATION Georgia has recently seen a disturbing trend in which onerous broad form indemnification clauses are being proposed in contracts for engineering or architectural services. Broad form indemnification clauses are ones that require the indemnitor engineer or architect to indemnify the other party to the contract from all liabilities, regardless of which party’s negligence caused the liability and even if the indemnitor engineer or architect has no fault at all. In some cases, these indemnification provisions are coupled with “duty to defend” clauses that would require the indemnitor engineer or architect to defend the other party to the contract (i.e. pay their legal expenses) against third party claims - even before any determination has been made as to whether the engineer or architect has made any error. Other than being fundamentally unfair, the largest problem with these types of indemnification clauses is that they are completely uninsurable. Many of the parties proposing these broad form indemnification provisions may not realize that by forcing a design professional to agree to a contract containing a broad form indemnification clause, they are losing the benefit of the design professional’s insurance coverage. Engineers and architects are insured under professional liability insurance (PL), which only covers damages to the extent caused by the negligent error or omissions of the design professional. This type of insurance is very different from a contractor’s general liability insurance (CGL), for example. Likewise, many design professionals may not realize that by signing one of these contracts, they are losing their insurance coverage for the liability they are taking on and are literally putting their firms on the line. A number of states have anti-indemnity statutes that make these types of broad form indemnification provisions unenforceable as a matter of law on the grounds that they violate long-standing public policy that one party should not be held responsible for the mistakes of others and courts in other states have likewise invalidated or strictly construed broad form indemnification provisions on public policy grounds. In Georgia, these kinds of clauses are a relatively recent trend and the goal is to pass legislation that will “nip it in the bud” before it becomes more pervasive. The goal is to work with members of the General Assembly to introduce legislation similar to the anti-indemnification statutes recently passed by states like Florida, Texas and Colorado. STRUCTURAL ENGINEER LEGISLATION In the 2015 session, House Bill 592 (HB 592) was introduced to create a new “P.E., S.E.” license for structural engineers in Georgia. Since 2011, engineers sitting for the P.E. exam whose experience is in structural engineering have been required to take a 16-hour exam, while engineers from all other engineering disciplines take an 8-hour exam. This 16-hour structural requirement is the standard set by the National Council of Examiners for Engineering and Surveying (NCEES) and has been adopted by most states and reflects the higher protection of the public health, safety and welfare necessary for those who design significant vertical structures and buildings. But the real impetus behind HB 592 is to address the competitive business disadvantage Georgia structural engineers currently have when competing for work in other states where structural engineers are licensed. A Georgia structural engineer might have more experience, but be passed over in favor of an engineer with a P.E., S.E. from another state. HB 592 seeks to eliminate that disadvantage and put Georgia in line with the national trend. HB 592 also contains a grandfathering provision which would allow any currently licensed professional engineer to obtain the “P.E., S.E.” license by simply submitting a signed affidavit to the Professional Engineers and Land Surveyors Board stating that they are a practicing structural engineer. DEFENDING TRANSPORTATION FUNDING Last year, the Georgia General Assembly passed House Bill 170 (HB 170), which created almost $1 billion per year in new dedicated funding for transportation. One of the provisions of HB 170 was a $5 per night room charge on hotels in Georgia. While only a nominal fee for hotel guests, the revenue generated by this fee is a significant component of the revenue generated by HB 170. Some in the hotel industry believe that the fee puts them at a competitive disadvantage in luring hotel guests who might be considering visits to hotels in other states as well and would like to reduce or eliminate the room fee altogether. The Governor and legislative leaders have expressed their belief that in order to justify modifying the hotel fee, legislators should be able to see at least a year’s worth of data showing that the fee actually had some significant negative impact (the tax has only been in effect since July 2015) and that this year’s session would be too soon to revisit it. ACEC Georgia will continue to be a part of the broad coalition represented by the Georgia Transportation Alliance that helped pass HB 170 last year in defending this milestone legislation from being tampered with during the 2016 session. OTHER ISSUES While the engineering industry will be focused only on the three issues mentioned above, there are only so many hours in a day and the Georgia General Assembly can only meet for 40 days. Invariably, other issues will come to the forefront and compete for a significant portion of legislative time and attention. Oftentimes, these are the issues that generate new stories (and media mentions for the legislator sponsoring the bill). One such issue certain to occupy a lot of legislative time is Senate Bill 129 (SB 129), the Religious Freedom Restoration Act (“RFRA’), sponsored by Senator Josh McKoon (R-Columbus). According to its proponents, SB 129 seeks to provide additional legal protections for individuals and businesses to exercise their religious beliefs. According to its opponents, SB 129 is an attempt to permit discrimination, particularly directed at homosexuals within the context of same-sex marriage. SB 129 easily passed the Senate in the 2015 legislative session, but stalled in the House Judiciary Committee when House Republicans added an anti-discrimination provision to which the bill’s sponsor objected. Look for this fight to resume. Governor Nathan Deal has made it clear that education, criminal justice reform and promoting economic and workforce development are the primary goals of his administration. Additional criminal justice reforms related to the re-integration opportunities of first-time offenders will be introduced to further Gov. Deal’s criminal justice reform efforts. However, it’s the Governor’s K-12 education funding reform legislation that will occupy a significant amount of legislative bandwidth. Since 1985, state funding for K-12 education has been based on the Quality Basic Education Act (QBE), although QBE has never been fully funded since then. Since 1985, there have been significant changes to K42 education funding from both the Federal level, as well as important state initiatives such as Move on When Ready and Dual Enrollment. In addition, there are tremendous disparities in local funding levels for K-12 education, as well as disparities in educational performance and graduation rates. While specific details were not available at press time, many observers expect Gov. Deal to introduce legislation during the 2016 or 2017 legislative session that would address these disparities and bring accountability based on measurable academic performance of school systems into the state’s K-12 education funding formula. CONCLUSION ACEC Georgia will continue to fight for the interests of the business of engineering under the Gold Dome, as well as in Washington D.C. and before state agencies and local governments here in Georgia. While our focus for the 2016 legislative session is on indemnification and structural engineering licensure, we are already laying the groundwork for other important initiatives in future legislative sessions, including our current QBS Task Force, headed by ACEC Georgia Chairman Roseana Richards and (like the Indemnification Task Force focused on this year’s legislation) in partnership with AIA Georgia and other industry partners. In order to effectively represent the interests of the engineering industry, we need to hear from you. When an issue comes up that affects the business of Georgia’s engineering industry, let us know. We are here to fight for you!
Published by American Council of Engineering Companies of Georgia. View All Articles.
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