Following the construction industry and related legal topics in the United States.

Friday, May 12, 2006

Update: Georgia General Assembly Bills

Georgia Governor Sonny Perdue has signed into law several bills affecting construction and development in Georgia:

  • Mechanic's and Materialmen's liens on easement and right-of-way work. SB 530 expanded the subject matter of a lien to include the value of work done and materials furnished in any easement or public right of way adjoining the lien real estate to the extent that the work done in the adjacent easement or right of way "is for the benefit of [the] real estate and is within the scope of the owner's contract for improvements to [the property liened]." Statute affected: OCGA 44-14-361(b).

  • Eminent Domain. In final form, HB 1313 redefined "blighted property," restricting its use as a ground for condemnation to property that is either: (a) a threat to health or safety; or (b) criminally misused on a repeated basis. Esthetics cannot be considered in determining blight. For Georgia governments to exercise eminent domain, the intended "public use" must be for the "possession, occupation, or use of the land by the general public, [state entities, and certain public utilities.]"

  • Private plan review and inspections. HB 1385 allows owners to hire "private professional providers" to review plans for permitting and to inspect work under construction - where the public authority notifies the owner that is cannot review the submitted plans within 30 days. Owners must pay both the normal plan review fees to the governmental agency and the fees required by the private professional provider. Government may still exercise its power to stop work where codes and standards are not being met. Certain projects (like airports, hospitals, jails, nursing homes, and projects potentially affecting homeland security) are ineligible for private review. Reviewers may not have any financial interest in the project - and the same professional who designed the project cannot provide the review and inspection services. Professional providers are accountable professionally for their services, and the same standard of care applies to those services as would apply to other professional services rendered. Professionals must provide professional liability insurance coverage not less than $1 million per claim and $1 million in aggregate coverage.

  • Debarment statute will not become law - to the relief of many. Although it was earlier reported on the General Assembly's website that the House Conference Committee Report had been adopted, HB 1090 was not passed, and will not become law. The bill's latest form would have effectively debarred a contractor from work for state and local government if the contractor was found to be behind schedule on two or more state projects. Whether the contractor was "behind" was left to employees of the government - although it was judicially appealable. This bill was not well-draft and was not favored by contractors. It will not be missed.

  • Land Conservation Tax Credit. HB 1107 (codified at OCGA 48-7-29.10) allows a state income tax credit to be taken for donations of land for conservation purposes to state or local government or to a bona fide charitable non-profit organization. The credit is generally limited to $500,000 or 25% of fair market value of the property. The credit cannot exceed the taxpayer's total tax liability for a given year; but the act does provide some conditional carry-over in limited circumstances. There are limited provisions for carry-over. The credit is further limited where tax liability is calculated under OCGA 48-7-20.

You can read the earlier client alert here.


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