THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

INTRODUCED BY GODSHALL, PRESTON, AUMENT, BAKER, BURNS, BUXTON, CHRISTIANA, P. COSTA, DELOZIER, ELLIS, FABRIZIO, FARRY, GABLER, GIBBONS, GRELL, KAUFFMAN, M. K. KELLER, MARSICO, METZGAR, MURT, MUSTIO, OBERLANDER, PAYTON, PICKETT, PYLE, QUIGLEY, QUINN, REED, SAINATO, SANTONI, SCHRODER, SONNEY, STEPHENS, SWANGER, TOOHIL AND VEREB, APRIL 12, 2011

REFERRED TO COMMITTEE ON CONSUMER AFFAIRS, APRIL 12, 2011  

AN ACT

Amending the act of October 17, 2008 (P.L.1645, No.132),

entitled "An act providing for the regulation of home

improvement contracts and for the registration of certain

contractors; prohibiting certain acts; and providing for

penalties," providing for the definition of "home improvement

retailer"; and further providing for procedures for

registration as a contractor and for prohibited acts.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 2 of the act of October 17, 2008

(P.L.1645, No.132), known as the Home Improvement Consumer

Protection Act, is amended by adding a definition to read:

Section 2.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

* * *

"Home improvement retailer."  A person, whether or not the

person is registered under this act, who sells materials for use

in home improvement contracts.

* * *

Section 2.  Sections 4(a)(1)(i) and (ix), 5 and 9(10) of the

act are amended to read:

Section 4.  Procedures for registration as a contractor.

(a)  Application.--

(1)  A person shall apply to the bureau in writing or

electronically via a secure Internet connection, if permitted

by the bureau, on a form provided by the bureau. The

application shall include the following information:

(i)  For an individual applicant, all of the

following:

(A)  Name.

(B)  Date of birth.

(C)  Home address and home telephone number.

(D)  Driver's license number [or], a copy of an

identification card issued by the state in which the

individual resides or other form of identification as

permitted by the bureau.

(E)  Business name, address and telephone number.

(F)  Federal employer identification number, if

applicable.

(G)  Social Security number.

(H)  All prior business names and addresses of

home improvement businesses operated by the

individual.

* * *

(ix)  Proof of liability insurance covering personal

injury in an amount not less than $50,000 and insurance

covering property damage caused by the work of a home

improvement contractor in an amount not less than

$50,000. For the purpose of this subparagraph, proof of

insurance may include information attested to by an

applicant that the applicant is self-insured and the

bureau shall develop forms for this purpose and make them

available to applicants. The bureau may determine the

sufficiency of the self-insurance and the manner in which

it is maintained in compliance with this act.

* * *

Section 5.  Application fees.

(a)  Amount.--Each application for a certificate for a home

improvement contractor or renewal of that certificate shall be

accompanied by a fee of $50. After completion of the application

and payment of the fee, the bureau shall issue the home

improvement contractor a registration certificate identifying

the name of the individual contractor, name and address of the

business and a registration number. Renewals shall be on a

biennial basis.

(b)  Home Improvement Account.--

(1)  A restricted revenue account known as the Home

Improvement Account is established in the General Fund. All

fees and penalties collected under this act after the

effective date of this subsection shall be deposited into the

Home Improvement Account, which account shall be interest-

bearing.

(2)  The funds in the Home Improvement Account and any

interest earned on the funds shall be appropriated to the

Attorney General for administering and enforcing the

provisions of this act and to protect consumers with respect

to home improvements through consumer education and other

means.

Section 9.  Prohibited acts.

No person shall:

* * *

(10)  [For] (i)  Except as provided under subparagraph

(ii), for a home improvement contract in which the total

price is more than [$1,000] $5,000, receive a deposit in

excess of:

[(i)] (A)  one-third of the home improvement

contract price; or

[(ii)] (B)  one-third of the home improvement

contract price plus the cost of special order

materials that [have been ordered] will be ordered,

as designated in the written contract.

(ii)  The provisions of subparagraph (i) shall not

apply to a home improvement retailer, regardless of net

worth, who does all of the following:

(A)  Posts an irrevocable letter of credit,

payable to the bureau for the use and benefit of

every person protected by the provisions of this

subparagraph in a form approved by the bureau, in the

amount of $100,000 per store location but not to

exceed $2,000,000 for a home improvement retailer

that has multiple stores.

(B)  Ensures that its contractors are registered

under this act and have proof of liability insurance

as defined in section 4(a)(1)(ix).

(iii)  In the event of a dispute with a home

improvement retailer or a contractor authorized to do

work on behalf of the home improvement retailer, an owner

may file with the bureau a complaint against the home

improvement retailer and request a draw upon the home

improvement retailer's letter of credit. The following

shall apply:

(A)  Upon receipt of a complaint, the bureau

shall notify the home improvement retailer and

investigate the complaint.

(B)  Upon a determination by the bureau that the

home improvement retailer is in default of the

contract, the bureau may, after providing notice to

the home improvement retailer, draw upon the

irrevocable letter of credit to satisfy a consumer's

complaint as part of its mediation process or a civil

action brought under the act of December 17, 1968

(P.L.1224, No.387), known as the Unfair Trade

Practices and Consumer Protection Law.

(C)  A home improvement retailer with two draws

on an irrevocable letter of credit within a two-year

period issued for the purposes of this subparagraph

shall be prohibited from posting an irrevocable

letter of credit for purposes of this subparagraph

for a period of five years beginning from the date of

the second draw and shall be required to comply with

subparagraph (i).

* * *

Section 3.  This act shall take effect immediately.