Report Title:

Public Works Contracts; License Class

Description:

Requires bidders on certain public works contracts to identify specialty contractors. Clarifies that contractors are not authorized to engage in construction activities not provided by the rules of the contractors license board.

THE SENATE

S.B. NO.

46

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to contractors.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature finds that the intermediate court of appeals recently misinterpreted the intent of section 444-7, Hawaii Revised Statutes, on the classification of building contractors into three categories. Specifically, the court interpreted the statutory language to empower a contractor with a general engineering license to operate as if it held a specialty contractor license that it did not actually hold. The court's decision thereby caused the statutorily unintended effect of permitting a general engineering license holder to perform work requiring a specialty license outside of the specialty areas recognized for a general engineering license holder.

The purposes of this Act are to (1) clarify the legislative intent of section 444-7, Hawaii Revised Statutes, concerning the three major classifications of building contractors as being set forth for classification purposes only and not as a contractor empowering provision vesting contractors with a license to engage in activities not expressed in the rules of the contractors license board, and, (2) clarify the procurement code, section 103D-302, Hawaii Revised Statutes, to ascertain that those holding certain specialty contractor licenses are always to be identified in a construction bid.

SECTION 2. Section 103D-302, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) An invitation for bids shall be issued, and shall include a purchase description and all contractual terms and conditions applicable to the procurement. If the invitation for bids is for construction, it shall specify that all bids include the name of each person or firm to be engaged by the bidder as a joint contractor or subcontractor in the performance of the contract and the nature and scope of the work to be performed by each. Construction bids that do not comply with this requirement may be accepted if acceptance is in the best interest of the State and the value of the work to be performed by the joint contractor or subcontractor is equal to or less than one per cent of the total bid amount.

Notwithstanding this subsection, where bids are for the construction of improvements to real property, the project requires the services of a contractor holding a plumbing, electrical, elevator, asbestos, or boiler specialty contractor's license as may be defined by the rules of the contractors license board, and the contractor bidding on the project does not hold that specialty contractor's license, the bidding contractor shall identify in the bid each license holder whom the bidding contractor will engage as a joint contractor or subcontractor in the performance of the contract."

SECTION 3. Section 444-7, Hawaii Revised Statutes, is amended to read as follows:

"§444-7 Classification. (a) For the purpose of classification, the contracting business includes any or all of the following branches:

(1) General engineering contracting;

(2) General building contracting;

(3) Specialty contracting.

(b) A general engineering contractor is a contractor whose principal contracting business is in connection with fixed works requiring specialized engineering knowledge and skill, including the following divisions or subjects: irrigation, drainage, water power, water supply, flood control, inland waterways, harbors, docks and wharves, shipyards and ports, dams and hydroelectric projects, levees, river control and reclamation works, railroads, highways, streets and roads, tunnels, airports and airways, sewers and sewage disposal plants and systems, waste reduction plants, bridges, overpasses, underpasses and other similar works, pipelines and other systems for the transmission of petroleum and other liquid or gaseous substances, parks, playgrounds and other recreational works, refineries, chemical plants and similar industrial plants requiring specialized engineering knowledge and skill, powerhouses, power plants and other utility plants and installations, mines and metallurgical plants, land leveling and earth-moving projects, excavating, grading, trenching, paving and surfacing work and cement and concrete works in connection with the above mentioned fixed works.

(c) A general building contractor is a contractor whose principal contracting business is in connection with any structure built, being built, or to be built, for the support, shelter, and enclosure of persons, animals, chattels, or movable property of any kind, requiring in its construction the use of more than two unrelated building trades or crafts, or to do or superintend the whole or any part thereof.

(d) A specialty contractor is a contractor whose operations as such are the performance of construction work requiring special skill such as, but not limited to, electrical, drywall, painting and decorating, landscaping, flooring, carpet laying by any installation method, plumbing, or roofing work, and others whose principal contracting business involves the use of specialized building trades or crafts.

(e) The descriptions in this section are provided for classification purposes only and do not empower or authorize a general engineering contractor, a general building contractor, or a specialty contractor to engage in construction activities not provided by the rules of the contractors license board."

SECTION 4. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________