Contractor Registration, SB 100
 

• All registrations will need to be completed by July 1, 2009 (the date the law goes into effect) Any home improvement contractor must be registered and operating within the law by this date.
• Registration with the Bureau of Consumer Protection within the Office of Attorney General
• A $50 registration fee will be required every other year.
• The registration number must be used by the home contractor on all documents (contracts, advertisements, business cards, etc) used by the home contractor. “Advertisement” is defined as a statement promoting home improvement services in a newspaper, periodical, pamphlet, circular, billboard, sign, letterhead, business card or other printed materials, or announcements to the public on radio, television or the internet. The term shall not include the following: 1) sponsorship or recognition of sponsorships of civic, charitable or nonprofit events, teams or purposes; 2) writings or graphics on promotional clothing, pens, pencils, notepads or similar items.
• The law exempts contractors doing less than $5,000 in business annually from registering.
•  A home improvement retailer (home depot, lowe’s) having a net worth of more than $50 million. However, their subs are required to register.
• Registration under this act eliminates any requirement of payment of a fee or registration or licensing of any home improvement contractor by any political subdivisions. The exception is those cities (Philadelphia/Pittsburgh) that provide true licensing requirements – testing, etc.
• The definition of “home improvement”: the term includes the following done in connection with land or a portion of the land adjacent to a private residence or a building or a portion of the building which is used or designed to be used as a private residence for which the total cash price of all work agreed upon between the contractor and owner is more than $500:
  • Repair, replacement, remodeling, demolition, removal, renovation, installation, alteration, conversion, modernization, improvement, rehabilitation or sandblasting
  • Construction, replacement, installation or improvement of driveways, swimming pools, pool houses, porches, garages, roofs, siding, insulation, solar energy systems, security systems, flooring, patios, fences, gazebos, sheds, cabanas, landscaping or a type that is not excluded under (2)(vi) painting doors and windows and waterproofing.
  • Without regard to affixation, the installation of central heating or air conditioning or storm windows or awnings.
• The term does not include:
  • The construction of a new home.
  • The sale of goods or materials by a seller who neither arranges to nor performs, directly or indirectly, any work or labor in connection with the installation or application of goods or materials
  • The sale of services furnished for commercial or business use or for resale, if the service takes place somewhere other than at a private residence.
  • The sale of appliances, including stoves, refrigerators, freezers, room air conditioners and others which are designed for and are easily removable from the premises without material alteration.
  • Any work performed without compensation by the owner of the owner’s private residence or residential rental property.
  • Any work performed by a landscaper certified by the Department of Agriculture under the Act known as the Plant Pest Act, except to the extent that the work involves any of the following at a private residence:
    • A construction, replacement, installation or improvement of buildings, driveways, swimming pools, porches, garages, roofs, siding, insulation, solar energy systems, security systems, flooring, patios, nondecorative fences, doors, lighting systems, concrete walkways and windows.
    • The placement of retaining walls, fountains or drainage systems.
  • The conversion of existing commercial structures into residential or noncommercial structures.    

• The home improvement contractor will need to have proof of liability insurance covering personal injury in an amount not less than $50,000 and insurance covering property damage caused by work of a home improvement contractor in an amount not less than $50,000.
• For a home improvement contract in which the total price is more than $1,000, a contractor may not receive a deposit in excess of : 1) one-third of the home improvement contract price, or 2) one-third of the home improvement contract price plus the cost of special order materials that have been ordered.
• New criminal penalties – Home Improvement Fraud is defined as – a person commits the offense of home improvement fraud, if, with intent to defraud or injure anyone or with knowledge that he is facilitating a fraud or injury to be perpetrated by anyone, the actor:
  • Makes a false or misleading statement to induce, encourage or solicit a person to enter into a written or oral agreement for home improvement services or provision of home improvement materials or justify an increase in the previously agreed upon price.
  • Receives any advance payment for performing home improvement services or providing home improvement materials and fails to perform or provide such services or materials when specified in the contract taking into account any force majeure or unforeseen labor strike that would extend the time frame or unless extended by agreement with the owner and fails to return the payment received for such services or materials which were not provided by that date;
  • While soliciting a person to enter into an agreement for home improvement services or materials, misrepresents or conceals the contractor’s or salesperson’s real name, the name of the contractor’s business, the contractor’s business address or any other identifying information;
  • Damages a person’s property with the intent to induce, encourage or solicit that person to enter into a written or oral agreement for performing home improvement services or providing home improvement materials;
  • Misrepresents himself or another as an employee or agent of the Federal, Commonwealth or municipal government, any other governmental unit or any public utility, with the intent to cause a person to enter into any agreement for performing home improvement services or providing home improvement materials;
  • Misrepresents an item as a special order material or to misrepresent the cost of the special order material;
  • Alters a home improvement agreement, mortgage, promissory note or other document incident to performing or selling a home improvement without the consent of the consumer; or
  • Directly or indirectly publishes a false or deceptive advertisement in violation of State law governing advertising about home improvement.
• No guaranty fund is included in this legislation.
• The AG and the county district attorneys will have authority to investigate and institute criminal proceedings for any violation of this act. The Administrative Offices of the Pennsylvania Courts is required to report to the Bureau of Consumer Protection any suspension or revocation of a certificate ordered by the court.

• A PBA implementation task force will be created.
• PBA will create a model home improvement contract for member use. We anticipate having this contract available after the February 2009 board meeting.
• A publicity campaign will be put together to notify our member remodelers.
• We will be able to use this as a member recruitment tool.
• PBA staff will be available for presentations in the new year.

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