By Shelly Masters and Nick Gavrizi
The City of Austin issued Stay Home-Work Safe Order No. 200200324.007 (the “Austin Order”) which was quickly followed by a Guidance for the Construction Industry on March 24, 2020 (the “Guidance”). On the same day, Travis County issued its own Stay-At-Home Order by the County Judge of Travis County, County Judge Order No. 2020-5: Relating to the Declaration regarding COVID-19 (the “Travis Co. Order”)(collectively, the “Orders”). The Travis Co. Order, which in large part mirrors the Austin Order, likely supplants the Austin Order as it includes the City of Austin in its “List of Cities and Municipalities within Travis County Jurisdiction covered by the Order” as Exhibit A. The Orders and Guidance require a shutdown of non-essential businesses and activities.
Unlike other Texas counties and states, the Austin and Travis County Orders dealt a solid blow to construction-as-usual in and around Austin, Texas with the broadest shutdown restrictions yet seen in response to the COVID-19 spread. This move by local authorities came despite a growing national precedent even in the hardest hit states to exempt such “essential” activities deemed to be operations in furtherance of the critical infrastructure per an advisory issued by the Cybersecurity and Infrastructure Security Agency or “CISA” from such shutdowns. These operations and maintenance tasks include public works construction, residential construction, commercial construction, airport operations, water, sewer, gas, electrical, oil refining, roads and highways, public transportation, solid waste collection and removal, internet and telecommunications systems, financial institutions, defense and national security-related operations, and essential manufacturing operations. These critical infrastructure sectors have been designated by the U.S. Department of Homeland Security as being so vital to the United States that their incapacitation or destruction would have a debilitating effect on security, national economic security, national public health or safety, or any combination thereof. For more information, please visit www.cisa.gov.
Instead, the new Orders have sparked widespread confusion due largely to the extreme divergence from other shelter-in-place orders and unclear, vague and ambiguous language giving rise to differing legal interpretations of their import. Although the effective date of both Orders has passed (11:59 p.m. on March 24, 2020), the City of Austin’s Guidance states it will not cite contractors who have not yet ceased non-essential operations until midnight tomorrow, March 27, 2020, so long as they can demonstrate the post-Order activities were for the purpose of shutting down the project. Contractors have already reported jobsite visits from city authorities requiring shutdown compliance on some commercial projects.
Construction industry participants have less than 48-hours to complete the difficult task of assessing which projects in their inventory must cease and which are allowed to continue under the Orders’ definitions of “critical infrastructure”, “essential businesses” and “essential activities”. This article includes a brief summary of the Orders, a detailed list of what types of construction are arguably allowed to proceed, a sample notification that construction is allowed to procced, guidance on jobsite safety measures which must be followed for those projects not subject to the shutdown, the repercussions of noncompliance and a short summary of the industry response to the Orders. Available at http://www.austintexas.gov/sites/default/files/files/Order%2020200324-007%20-%20Stay%20Home%20-%20Work%20Safe.pdf and https://www.aiaaustin.org/sites/default/files/construction-guidance-stay-home-order-03-24-20.pdf
 Available at http://www.austintexas.gov/sites/default/files/files/20200324%20Judge’s%20Order.pdf
City of Austin/Travis County Orders
The Austin Order permits individuals to leave their homes to perform and obtain services in connection with certain “Essential Activities,” “Essential Businesses,” and “Critical Infrastructure” as defined therein. Austin Order at §1. It also mandates that “Non-Essential Business” must cease all activities with some limited exceptions (working for home, securing inventory, and processing employee payroll/benefits). Austin Order at §§2, 6(g).
Construction as a whole as is not defined as an “Essential Activity” or “Essential Business”. However, the list of essential businesses does include a few “Critical Trades” such as plumbers and electricians necessary to maintain the sanitation/operation of homes and other essential businesses/public facilities). Austin Order at §§6(b), 6(f)(ix). Further, the Austin Order also includes the following in its list of “Critical Infrastructure”:
Austin Order at Exhibit B, §2(p)(q). This language arguably exempts most commercial construction since it carves out construction of “critical infrastructure” and CISA identifies a broad range of commercial projects as critical infrastructure including hotels, motels, conference centers, office and apartment buildings, condominiums, mixed use facilities, retail centers and shopping as seen below.
Available at https://www.cisa.gov/commercial-facilities-sector.
Although the Travis Co. Order largely tracks the Austin Order, there are some key differences. First, the Travis Co. Order adds the highlighted sentence below to the definition of “Critical Trades” that qualify as essential businesses:
Travis Austin at §6(e)(ix). This suggests that the County does not view all general contractors or subcontractors as “critical trades” and certain discretionary activities associated with those trade are nonetheless subject to the shutdown under the order.
More importantly, the Travis Order removed the Austin Order’s reference to CISA-defined critical infrastructure from its own list of Critical Infrastructure:
Travis Order at Exhibit C. These changes suggest that County officials are trying to limit the scope of permissible construction activities.
After the Travis Order was issued, the City of Austin issued its Guidance. In the Guidance, the City of Austin states that the “fundamental test” for determining Critical Infrastructure is whether it is “vital to the security, governance, public health, safety, and economic security of the City of Austin”:
Guidance Order at §1. However, it still includes in its list of “Critical Infrastructure” those sectors of critical infrastructure as defined in the Austin Order:
As a result, there is a conflict in the Guidance–although it states that most commercial projects are prohibited, it carves out “Critical Infrastructure” as defined in the Austin Order which would permit most commercial projects to continue.
Given this ambiguity, until there is further guidance from the City, County, or Governor, contractors should strongly consider continuing to work (especially if the project involves an “essential business” or public facility). A reality to consider is that a warning will probably be given before any fine is issued and the fine ($1,000/person) may pale in comparison to the cost of defending delay claims asserted by owners. However, beware that an enforcement option is confinement. See Violation of Orders section below.
What is “Essential” or Exempt from the Shutdown?
As mentioned, the ambiguity in the language of the Orders does not give rise to a definitive answer for every project. A project-by-project analysis should be conducted to determine if any portion of the project falls within the definitions of “Essential Business”, “Essential Government Functions”, “Critical Infrastructure” or other exemptions. The Guidance indicates that a project may been deemed essential or defined as critical infrastructure if even a small portion of the project qualifies as such. Further, there is no deadline by which construction must be completed in order to be considered exempt. Thus, it appears any project that falls within the below categories, in whole or part, may continue operations regardless of the stage of construction. However, purely single-family residential or commercial construction projects that do not fall into one of the below categories must cease.
Per the Orders, the types of construction projects listed below should be permitted to continue. Some specific examples were included in the Orders and others have been added based on a reasonable interpretation of the language in the Orders.
Contractors who are unsure about whether or not the project is exempted should consider sending a written request to the project owner or upper tier contractor for guidance on whether the project is an “Essential Business”, “Essential Government Functions”, “Critical Infrastructure” or another exempted category.
Areas of Essential Business or Critical Infrastructure or Other Exemptions
- construction of public works and/or government buildings;
- affordable housing projects;
- construction of facilities for individuals experiencing homelessness;
- construction of any facility related to healthcare (e.g., hospitals, clinics, biotechnology facilities, medical research facilities, etc.);
- construction of facilities for businesses that sell food or other “household consumer products” (e.g., grocery stores, convenience stores, liquor stores, and “big box stores”);
- construction projects performed for non-profits;
- construction projects performed for news media businesses;
- construction of gas stations, auto dealerships, and any other facility related to transportation (including airport projects);
- construction projects involving banks, credit unions, title companies or any other type of financial institution;
- construction projects of hardware and supply stores (e.g., Home Depot, Lowes, etc.);
- construction of facilities that provide mail and delivery services (e.g., post offices, FedEx stores, etc.);
- construction of any type of educational facility (including dormitories);
- construction of restaurants;
- construction of facilities for businesses that supply products to work from home (e.g., office depot, best buy, etc.);
- construction of facilities that perform essential government functions (anything needed to ensure continuing operation of governmental agencies and provide for the health, safety and welfare of the public);
- construction of facilities that provide home-based care and services for seniors and children (e.g., nursing homes, daycares, etc.);
- construction of residential facilities and shelters (arguably this includes multi-family apartments as “residences” is defined to include “hotels, motels, shared rental units, and similar facilities”);
- construction of facilities that provide professional services (legal, accounting. insurance, and real estate services);
- construction of hotels and motels;
- construction of facilities that provide moving supply services;
- construction of facilities that provide funeral services;
- construction of facilities used for information technology or telecommunications services;
- construction of facilities that provide fire and law enforcement;
- construction of any facilities or public utility that provides power, water, natural gas, and sanitation services;
- construction of facilities that provide laundry services (e.g., laundromats, dry cleaners, etc.);
- construction of facilities that perform “critical manufacturing” (e.g., “components for primary metals, machinery, electrical equipment and components, health and safety products and equipment, and transportation equipment”);
- construction of facilities for auto and vehicle parts manufacturing and assembly;
- construction of facilities for technology manufacturing;
- construction of facilities used for emergency services;
- construction of any government buildings; and,
- construction of facilities specifically required by the City to respond to the current COVID- emergency.
 Per the Travis Order these may not be exempted.
 Per the Travis Order these may not be exempted.
It should also be noted that plumbers, electricians, exterminators, pool cleaners and “other service providers” are allowed to continue to operate “to the extent that services are necessary to maintain the safety, sanitation, and operation” of residences and the essential businesses, critical infrastructure, and governmental services described above.
Essential Business Notification
Owners, general contractors, and/or other authorities may require you to provide notice that project construction is allowed to continue per an exemption under the Orders. While the Orders prescribe no specific language for any such notice, a sample is provided below for reference purposes only. Before using any such language, it is recommended that you consult with legal counsel to assist in an assessment of whether or not an exemption applied and tailor the below language to the specific project.
[COMPANY NAME] is involved in infrastructure, development, operation, and construction whose work is necessary to the operations and maintenance of one or more of the Essential Businesses as defined by the City of Austin and/or Travis County and/or 16 critical infrastructure sectors identified by the National Cybersecurity and Infrastructure Agency (CISA) as being so vital to the United States that their incapacitation or destruction would have a debilitating effect on security, national economic security, national public health or safety, or any combination thereof. For more information, please visit www.cisa.gov.
[COMPANY NAME] provides materials, labor, and/or services necessary for one or more of the essential businesses, essential activities, essential government functions and/or within the critical infrastructure sectors and is therefore permitted to continue operating, as specified in the Order by the County Judge of Travis County, County Judge Order No. 2020-5: Relating to the Declaration regarding COVID-19 signed by Judge Sarah Eckhart on March 24, 2020 and the Stay-Home Work Safe Order #20200324-007 by the Mayor of the City of Austin signed by Mayor Steve Adler on March 24, 2020.
For questions, please contact [COMPANY CONTACT (SUGGEST IN-HOUSE OR OUTSIDE LEGAL COUNSEL)].
What must you do if your project is exempt from the shutdown?
If a project falls within any of the 31 types of construction projects exempt from the Order, the Guidance Memorandum requires employers to do the following:
- create and implement an Infectious Disease Response Plan (OSHA provides further guidance on what must be included, your counsel can assist you with this);
- to the extent possible, maintain confidentiality of people with suspected or confirmed COVID-19;
- prior to entering any jobsite, ask employees if they meet any of the below criteria and direct them to return home if they do:
- have any signs of respiratory infection (cough, shortness of breath, sore throat);
- have a fever greater than 99.6 Fahrenheit (note that employers are just required to ask employees if they have a temperature, not actually take the temperature of employees prior to entrance);
- has had contact within the last 14 days with someone who received a confirmed COVID-19 diagnosis, is under investigation for COVID-19, or is ill with a respiratory illness; or
- has travelled to an area the World Health Organization or CDC considers a “Hotspot”
- immediately separate and send home any employee who becomes sick or demonstrates a temperature greater than 99.6 Fahrenheit;
- human resource departments must create alternate work plans to help employees remain productive while keeping workforce safe and healthy;
- suspend nonessential employee travel;
- prohibit employees from working within 6 feet of each other unless absolutely necessary;
- minimize in-person meetings and conference;
- require employees to stay home when sick;
- maximize flexibility in sick leave benefits;
- permit sick employees to stay home without a doctor note; and,
- unless necessary to provide essential services, alter employee schedules so that not all employees are present at one item but are present on alternative days and times.
Violation of Orders
Both Orders include a monetary fine and/or confinement as a penalty for noncompliance (i.e., failing to cease construction operations by the deadline). See below. The monetary fine may be up to $1,000 and may issue against any “persons” in violation of the order – meaning, any individual on the jobsite may be cited and not just the contracting company who fails to cease operations which are non-essential. A defense to any such citation or probable cause affidavit will be that the person was in compliance with the order. For example, the person may argue the project was exempt from the shutdown. Any persons cited should consider retaining legal counsel to appear and defend them before the designated magistrate.
Industry Trade Associations
Construction and other industry groups are making a concerted effort to communicate with local and state authorities to seek further clarification and/or a broader exemption of construction activity consistent with CISA’s mandate, as outlined in the Department of Homeland Security Cybersecurity and Infrastructure Security Agency’s March 19 Guidance on the Essential Critical Infrastructure Workforce: Ensuring Community and National Resilience in COVID-19 Response and refrain from any action to curtail ongoing critical construction services. Leaders of the Real Estate Council of Austin, Austin Chamber of Commerce, Austin Board of Realtors, the Downtown Austin Alliance, Austin Apartment Association, Home Builders Association of Greater Austin, LGBT Chamber of Commerce and Austin Contractors and Engineers Association submitted such correspondence to Mayor Steve Adler and Judge Eckhart on March 25, 2020. Member companies of local and state trade associations are being asked to actively participle in educating governmental authorities on the immediate and long-term impact of such a shutdown to critical infrastructure.