Business and Legal Insights

Earlier this year, the policymakers of Florida’s 2020 Legislative session tackled roughly 3,500 filed bills, passing roughly 200 and approving a $93.2 billion budget. Several pieces of this year’s legislative changes will substantially affect the construction industry.

This recap provides an overview of the notable legislation that stands to impact players within the construction industry:

CS/HB 101 — Public Construction

• This bill reduces the retainage cap from 10 percent of payments down to a flat rate five percent of payments throughout the term of the contract for construction services… The bill repeals:
  • The authority granted to a contractor to request the government entity to release up to half of the retained amount after fifty percent of the project is completed; and
  • The authority granted to a contractor to withhold more than five percent of each progress payment to his or her subcontractors after fifty percent of a project with a government entity is completed.

CS/CS/HB 441 — Public Procurement of Services

• The bill amends the definition of “continuing contract” to increase the maximum dollar amount for each individual project and each individual study under the contract for construction projects. The maximum dollar amount for each individual project is increased from $2 million to $4 million, and the maximum dollar amount for each individual study is increased from $200,000 to $500,000.

For more information, note the prior Shutts Construction blog post, “Governor DeSantis Signs Bill to Increase Cap on Continuing Public Works Contracts.“

CS/CS/SB 178 — Public Financing of Construction Projects

• The bill requires a public entity that commissions or manages a construction project within the coastal building zone, using funds appropriated from the state, to conduct a sea level impact projection (SLIP) study prior to commencing construction.

CS/CS/CS/SB 1066 — Impact Fees

• The bill imposes new requirements related to impact fees. Impact fees must have a reasonable connection, or rational nexus, between 1) the proposed new development and the need and the impact of additional capital facilities, and 2) the expenditure of funds and the benefits accruing to the proposed new development.

HB 469 — Real Estate Conveyances

• The bill provides that no subscribing witnesses are required for a lease of real property or any instrument pertaining to a lease of real property. The bill eliminates the requirement that two subscribing witnesses be present when the lessor, or lessor’s lawfully authorized agent, signs a lease with a term of more than 1 year.

CS/CS/HB 1091 — Environmental Accountability

• The bill makes numerous changes to the penalties for violating Florida’s environmental laws. The bill increases required or maximum environmental penalties in various sections of the Florida Statutes.
• The bill changes the duration that several penalties may run, so that each day during any portion of which certain violations occur constitutes a separate offense.
• The bill requires a seller of real property to disclose to a prospective purchaser, before executing a contract for sale, any defects in the property’s sanitary sewer lateral that are known to the seller. The bill also encourages municipalities and counties to voluntarily establish within their respective jurisdictions an evaluation and rehabilitation program for sanitary sewer laterals on residential and commercial properties to identify and reduce extraneous flow from leaking sanitary sewer laterals. The bill sets out certain requirements for such programs.

CS/HB 1193 — Deregulation of Professions and Occupations

Among several provisions in the Deregulation Bill, numerous construction industry licenses were deregulated and the Florida Building Commission was reduced in size while homebuilders were granted more seats.

• The “Occupational Freedom and Opportunity Act,” relates to businesses and professions regulated by the Department of Business and Professional Regulation (DBPR) and health professionals regulated by the Department of Health (DOH). The bill:
  • Revises the membership of the Florida Building Commission and reduces its membership from 27 members to 19 members.
  • The bill repeals the requirement that a yacht and ship broker must have a separate license for each branch office. It repeals the license requirement for cosmetology salons, and also eliminates the additional business organization for the following professional licensees: 
    • Architects and interior designers;
    • Landscape architects; and
  • The bill provides additional options or reduces the requirements for the following professionals, if licensed in another state, to qualify for a professional license in Florida:
    • Building code administrators and inspectors;
    • Home inspectors;
    • Engineers;
    • Certified public accountants;
    • Veterinarians;
    • Barbers;
    • Cosmetologists;
    • Architects;
    • Construction contractors;
    • Electrical and alarm contractors;
    • Landscape architects; and
    • Geologists.

CS/CS/HB 279 — Local Government Public Construction Works

• Under Florida law, counties, municipalities, special districts, and other political subdivisions seeking to construct or improve a public building or structure must competitively bid the project if the projected cost is in excess of $300,000.
• An exemption from the requirement to competitively award these projects exists when the governing board of a local government determines that it is in the public’s best interest to use services, employees, and equipment controlled by the government entity.
• The bill reforms how local governments must estimate the projected costs of a public building construction project. Local governments must use a revised cost estimation formula when deciding whether it is in the local government’s best interest to perform the project using its own services, employees, and equipment. The bill requires the estimated project cost formula to include employee compensation and benefits, the cost of direct materials to be used in the construction of the project, including materials purchased by the local government, other direct costs, and an additional factor of 20 percent for management, overhead, and other indirect costs. The bill also requires local governments to consider the same formula when determining the estimated cost of road and bridge construction and reconstruction projects performed with proceeds from the constitutional gas tax.

 CS/HB 1047 — Construction Materials Mining Activities

• The bill creates a pilot program in the Division of the State Fire Marshal (Division) within the Department of Financial Services for the monitoring and reporting of each blast resulting from the use of explosives for construction materials mining activities in Miami-Dade County. The bill requires a person who engages in construction materials mining activities to provide written notice to the State Fire Marshal of the use of an explosive for such activities in Miami-Dade County before the detonation of the explosive.