(a) "Contract for the improvement to realty" includes a contract with the intended purpose to:      
        (1) erect, construct, alter, or repair any building or other structure, project, development, or other permanent improvement on, under the surface of, or to real property, whether fee or leasehold;        
          (2) furnish and install property becoming a part of any building or other structure, project, development, or other permanent improvement on or to such real property, including tangible personal property, which after installation becomes real property by virtue of being embedded in or permanently affixed to the land or to a structure constituting realty and which property after installation is necessary to the intended usefulness of the building or other structure; or          
            (3) alter the land surface of real property by such means as creating roads, earthen dams, and stock tanks. However, mining or timber operations do not, in andof themselves, constitute improvements to realty.            
              (b) "Contract for the improvement to realty" does not include:              
                (1) a contract for the sale and installation of tangible personal property; this includes a contract to furnish and install machinery, equipment, or other tangible property not essential to the building or structure, nor adapted or intended to become a part of the realty, but which incidentally may, on account of its nature, be temporarily attached to the realty without losing its identity as a particular piece of machinery, equipment, or property and, if attached, is readily removable without substantial damage to the unit or to the realty or without destroying the intended usefulness of the realty;                
                  (2) the furnishing of tangible personal property if the person furnishing the property is not responsible for the final affixation or installation of any of the property furnished; or                  
                    (3) the furnishingof tangible personal property if the person furnishing the property is only responsible for supervision or warranty of installation without contractual responsibility for installation.                   
     Source Note:        The provisions of this §3.347 adopted to be effective February 7, 1979, 4 TexReg 218.