Part 1: Public Works Projects & Subcontractors ("First Tier Claimants")

For the next couple of weeks we will be posting a series of blogs relating to Public Works Construction Projects & Subcontractors ("First Tier Claimants"). Construction or improvements to public property are commonly referred to as public construction, public works contracts, or public projects. Some examples of public property are schools, courthouses, hospitals, highways, and bridges. On public projects, a subcontractor provides materials or labor to a general contractor whose contract is with a public entity. Unlike private property projects, a subcontractor cannot place a lien against public property due to nonpayment. Consequently, in order to protect their interests and increase their odds of receiving payment in full, subcontractors must be aware of the process and deadlines specific to public projects. In most cases, subcontractors on public projects who have not been paid by the general contractor may make a claim on the payment bond posted by the general contractor. A payment bond is a bond posted by the general contractor for the protection of subcontractors and sub-subcontractors. In more limited circumstances, subcontractors may have limited lien rights in money owed to the general contractor.

Please visit our blog again in a few days for Part 2: Public Works Construction Projects & Subcontractors: Prime Contracts Less Than $25,000.00.

Texas law governing public projects can be found in Texas Government Code Chapter 2253 (formerly known as the McGregor Act) and Texas Property Code Chapter 53.

Posted by Sarah F. Berry.