83R7955 PMO-F
By: Carona S.B. No. 19
A BILL TO BE ENTITLED
AN ACT
relating to certain residential and other structures and mitigation
of loss to those structures resulting from natural catastrophes;
providing administrative and criminal penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 2, Insurance Code, is amended
by adding Chapter 152 to read as follows:
CHAPTER 152. LOSS MITIGATION PROGRAMS
Sec. 152.001. DEFINITIONS. In this chapter:
(1) "Construction" includes alteration, remodeling,
enlargement, or repair of, or an addition to, a structure.
(2) "Mitigation measure" means an improvement to or
feature of a structure that reduces the risk or amount of loss from
a covered loss under a residential property insurance policy.
(3) "Qualified inspector" includes:
(A) an inspector certified by:
(i) the International Code Council;
(ii) the Building Officials and Code
Administrators International, Inc.;
(iii) the International Conference of
Building Officials; or
(iv) the Southern Building Code Congress
International, Inc.;
(B) a licensed professional engineer whose name
appears on the roster described by Section 1001.652, Occupations
Code; or
(C) a person who meets the requirements for
appointment to conduct windstorm inspections as specified by the
commissioner by rule.
(4) "Seacoast territory" has the meaning assigned by
Section 2210.003.
(5) "Trade association" means a nonprofit,
cooperative, and voluntarily joined association of business or
professional competitors designed to assist its members and its
industry or profession in dealing with mutual business or
professional problems and in promoting their common interest.
Sec. 152.002. ESTABLISHMENT OF PROGRAMS; PURPOSE. (a) The
commissioner in cooperation with the office of public insurance
counsel shall develop and implement statewide emergency
preparedness and loss mitigation programs designed to reduce
potential insured residential property losses in this state.
(b) The programs may:
(1) improve preparedness for windstorm, hail,
wildfire, and other natural catastrophes;
(2) reduce the risk and amount of potential insured
residential property losses arising from windstorm, hail,
wildfire, and other natural catastrophes;
(3) provide grants for loss mitigation measures; and
(4) promote public education about emergency
preparedness and loss mitigation related to windstorm, hail,
wildfire, and other natural catastrophes.
(c) The department and the office of public insurance
counsel may enter into an interagency contract or other agreements
with each other as appropriate to implement this chapter. The
department or the office of public insurance counsel, jointly or
severally, may enter into agreements with any individual or entity,
including a political subdivision, a state or federal agency, a
trade association, a university, or a nonprofit entity or other
private entity as appropriate to implement this chapter.
Sec. 152.003. FUNDING FOR LOSS MITIGATION GRANT PROGRAM.
The department in cooperation with the office of public insurance
counsel shall use its best efforts to obtain funding for loss
mitigation grants available under Section 152.005, including
obtaining:
(1) grants from any individual or entity, including a
political subdivision, a state or federal agency, a trade
association, a university, or a nonprofit entity or other private
entity; or
(2) gifts or grants of money or in kind.
Sec. 152.004. ADDITIONAL FUNDING FOR LOSS MITIGATION GRANTS
IN SEACOAST TERRITORY. The Texas Windstorm Insurance Association,
at the direction of the commissioner, shall provide money described
by Section 2210.454 in an amount determined by the commissioner to
provide funding in addition to the funding under Section 152.003
for grants available only to residential property owners in the
seacoast territory.
Sec. 152.005. LOSS MITIGATION GRANT PROGRAM. (a) The
commissioner in cooperation with the office of public insurance
counsel may establish and administer a grant program to provide to
residential property owners financial assistance to implement
mitigation measures.
(b) Subject to eligibility requirements determined by the
commissioner by rule, grants under this section may be made
available to residential property owners in areas susceptible to
windstorm, hail, wildfire, and other natural catastrophes as
determined by the commissioner by rule.
(c) Grants may be made available for implementation,
addition, or installation of mitigation measures, including:
(1) roof deck attachments;
(2) secondary water barriers;
(3) roof coverings;
(4) brace gable ends;
(5) roof-to-wall connection reinforcements;
(6) exterior opening protections;
(7) exterior doors, including garage doors;
(8) tie downs;
(9) reinforcements of trusses, studs, or other
structural components; or
(10) other mitigation measures approved by the
commissioner by rule.
(d) The commissioner may adopt by rule quality standards
applicable to the mitigation measures described by Subsection (c).
Sec. 152.006. LOSS MITIGATION CREDIT AND SURCHARGE PROGRAM.
(a) The commissioner by rule may identify actuarially justified
premium credits that may be given for a residential property
insurance policy if mitigation measures identified by the
commissioner by rule have been implemented, added, or installed in
an insured structure or in the construction of the structure.
(b) The commissioner by rule may adopt an actuarially
justified premium surcharge that may be imposed by an insurer for a
residential property insurance policy if the insured structure or
the construction of the structure does not meet building code
standards adopted by the commissioner by rule. The surcharge shall
be retained by the insurer issuing the policy for which the
surcharge is paid.
(c) The commissioner by rule may require inspection by a
qualified inspector of an insured structure or the construction of
the structure for a property owner to qualify for a premium credit
or to be subject to a premium surcharge under this section.
(d) The commissioner shall adopt rules necessary to
implement and enforce this section, including rules that:
(1) adopt building code standards; and
(2) define "actuarially justified" for the purposes of
this section.
Sec. 152.007. COLLECTION OF INFORMATION; PUBLIC
AVAILABILITY. (a) The department may collect information relating
to premium credits and surcharges:
(1) related to loss mitigation generally; or
(2) authorized under Section 152.006.
(b) The information collected under Subsection (a) may
include:
(1) the name of a credit or surcharge;
(2) the amount of a credit or surcharge;
(3) mitigation measures eligible for a credit;
(4) building code standards that must be met to avoid a
surcharge; and
(5) other information the commissioner in cooperation
with the office of public insurance counsel reasonably believes
promotes the purpose of this chapter.
(c) The information collected under this section may be used
in connection with the public education program established under
Section 152.009.
(d) The information collected under this section must be:
(1) made available to the public;
(2) posted on the department's Internet website; and
(3) posted on the Internet website of the office of
public insurance counsel.
(e) The department and the office of public insurance
counsel shall take all reasonable precautions to prevent disclosure
or use of personal information obtained in the collection of
information under this section.
Sec. 152.008. FUNDING FOR PUBLIC EDUCATION PROGRAM. The
department in cooperation with the office of public insurance
counsel shall use its best efforts to obtain funding for the public
education program established under Section 152.009, including
obtaining:
(1) grants from any individual or entity, including a
political subdivision, a state or federal agency, a trade
association, a university, or a nonprofit entity or other private
entity; or
(2) gifts or grants of money or in kind.
Sec. 152.009. PUBLIC EDUCATION PROGRAM. (a) The
commissioner in cooperation with the office of public insurance
counsel may create a public education program to educate and inform
the public about:
(1) the programs established under this chapter;
(2) the appropriateness of particular mitigation
measures in certain circumstances;
(3) the availability of credits described by this
chapter; and
(4) the imposition of surcharges described by this
chapter.
(b) To develop and implement the public education program,
the department in cooperation with the office of public insurance
counsel may coordinate or collaborate with any individual or
entity, including a political subdivision, a state or federal
agency, a trade association, a university, or a nonprofit entity or
other private entity.
SECTION 2. Sections 2210.454(a), (b), and (d), Insurance
Code, are amended to read as follows:
(a) The commissioner shall annually develop and implement a
mitigation and preparedness plan in coordination with the loss
mitigation programs authorized under Chapter 152.
(b) Each state fiscal year, the department may fund the
mitigation and preparedness plan and provide additional funding for
the loss mitigation program as described by Section 152.004 using
available funds.
(d) Money in excess of $1 million may not be used under this
section or provided to the loss mitigation program described by
Section 152.004 if the commissioner determines that an expenditure
of investment income from the trust fund would jeopardize the
actuarial soundness of the fund or materially impair the ability of
the fund to serve the state purposes for which the fund was
established.
SECTION 3. Sections 233.153(a), (c), and (f), Local
Government Code, are amended to read as follows:
(a) New residential construction of a single-family house
or duplex in the unincorporated area of a county [to which this
subchapter applies] shall conform to the version of the
International Residential Code published as of May 1, 2008, or the
version of the International Residential Code that is applicable in
the county seat of that county.
(c) If a municipality [located within a county to which this
subchapter applies] has adopted a building code in the
municipality's extraterritorial jurisdiction, the building code
adopted by the municipality controls and building code standards
under this subchapter have no effect in the municipality's
extraterritorial jurisdiction.
(f) Except as provided by Section 233.1546, a [A] county may
not charge a fee to a person subject to standards under this
subchapter to defray the costs of enforcing the standards.
SECTION 4. Sections 233.154(b) and (c), Local Government
Code, are amended to read as follows:
(b) Before [If required by a county to which this subchapter
applies, before] commencing new residential construction, the
builder shall provide notice to the county on a form prescribed by
the county of:
(1) the location of the new residential construction;
(2) the approximate date by which the new residential
construction will be commenced; and
(3) the version of the International Residential Code
that will be used to construct the new residential construction
before commencing construction.
(c) Not [If required by the county, not] later than the 10th
day after the date of the final inspection under this section, the
builder shall submit notice of the inspection stating whether or
not the inspection showed compliance with the building code
standards applicable to that phase of construction in a form
required by the county to:
(1) the county employee, department, or agency
designated by the commissioners court of the county to receive the
information; and
(2) the person for whom the new residential
construction is being built, if different from the builder.
SECTION 5. Subchapter F, Chapter 233, Local Government
Code, is amended by adding Sections 233.1545 and 233.1546 to read as
follows:
Sec. 233.1545. CERTIFICATION OF COMPLIANCE; CONNECTION OF
UTILITIES. (a) A county shall require the issuance of a
certificate of compliance as a precondition to obtaining utility
services as provided by this section.
(b) Not later than the fifth business day after the date a
notice of inspection described by Section 233.154(c) stating that
the inspection showed compliance with applicable building code
standards is received, the county shall issue the party submitting
the notice a written certificate of compliance.
(c) An electric, gas, water, or sewer service utility may
not permanently serve or connect new residential construction of a
single-family house or duplex as described by Section 233.151(a)(1)
with electricity, gas, water, sewer, or other utility service
unless the utility receives a certificate issued by the county
under Subsection (b).
(d) Subsection (c) does not prevent the temporary use or
connection of utilities necessary to complete new residential
construction, including temporary use or connection of utilities to
pass an inspection under this subchapter.
Sec. 233.1546. FEES. A county may charge a reasonable fee
to issue a certificate of compliance under Section 233.1545. The
fees, aggregated annually, may not exceed the annual cost of
issuing the certificates under Section 233.1545.
SECTION 6. Title 8, Occupations Code, is amended by adding
Chapter 1307 to read as follows:
CHAPTER 1307. ROOFING CONTRACTORS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 1307.001. SHORT TITLE. This chapter may be cited as
the Roofing Contractor Consumer Protection Act.
Sec. 1307.002. DEFINITIONS. In this chapter:
(1) "Advisory board" means the roofing contractors
advisory board.
(2) "Commission" means the Texas Commission of
Licensing and Regulation.
(3) "Controlling person" means an individual who:
(A) is an owner, officer, or director of a
roofing contractor;
(B) possesses direct or indirect control of at
least 10 percent of the voting securities of a roofing contractor
that is a corporation;
(C) owns or possesses direct or indirect control
of at least $25,000 of the fair market value of a roofing
contractor;
(D) directly or indirectly possesses the power to
direct or cause the direction of the management or policies of a
roofing contractor; or
(E) has a direct or indirect interest in at least
10 percent of the profits, proceeds, or capital gains of a roofing
contractor.
(4) "Department" means the Texas Department of
Licensing and Regulation.
(5) "Executive director" means the executive director
of the department.
(6) "Roofing contractor" means a person who performs
roofing services for compensation.
(7) "Roofing product" means any material commonly used
in the construction, installation, or replacement of a commercial
or residential roof.
(8) "Roofing services" means the installation,
construction, maintenance, repair, alteration, or modification of
a roofing product for a commercial or residential roof.
Sec. 1307.003. EXEMPTIONS. (a) This chapter does not apply
to:
(1) the owner of residential property or property used
primarily for agricultural purposes, or an employee of the owner,
who physically performs roofing services on the owner's dwelling or
on another structure located on the property;
(2) an authorized employee or representative of the
United States government, this state, or any county, municipality,
or other political subdivision of this state acting in an official
capacity;
(3) a person who furnishes any fabricated or finished
roofing product, material, or article of merchandise that is not
incorporated into or attached to real property by the person;
(4) an employee of a roofing contractor licensed under
this chapter; or
(5) a person who performs roofing services for the new
construction of a commercial or residential structure.
(b) Notwithstanding Subsection (a), a person described by
Subsection (a)(5) may be subject to the requirements of this
chapter to the extent the person provides roofing services other
than those described by that subdivision.
Sec. 1307.004. CONSTRUCTION OF CHAPTER; CONFLICT WITH OTHER
LAW. This chapter shall be construed to be in addition to any
required licensure of persons in this state. This chapter is not
intended to conflict with or affect the authority of any state or
local agency, board, or department that administers or enforces any
law or ordinance or that establishes, administers, or enforces a
policy, rule, qualification, or standard for a trade or profession.
SUBCHAPTER B. ADVISORY BOARD
Sec. 1307.051. ROOFING CONTRACTORS ADVISORY BOARD. (a)
The advisory board consists of five members appointed by the
presiding officer of the commission with the approval of the
commission as follows:
(1) one general contractor who is not a roofing
contractor;
(2) three roofing contractors licensed under this
chapter; and
(3) one public member.
(b) For purposes of Subsection (a)(2), the commission may
appoint a roofing contractor who is not licensed under this chapter
if the contractor has fulfilled the requirements for the issuance
of a license and has submitted a complete application to the
department. The commission shall remove from the advisory board a
roofing contractor appointed under this subsection if the
contractor does not receive a license before the 31st day after the
date the contractor is appointed to the advisory board.
(c) Appointments to the advisory board shall be made without
regard to the race, color, disability, sex, religion, age, or
national origin of the appointee.
(d) Chapter 2110, Government Code, does not apply to the
composition or duration of the advisory board.
Sec. 1307.052. POWERS AND DUTIES OF ADVISORY BOARD. The
advisory board shall provide advice and recommendations to the
commission on the adoption of rules governing the repair of a
roofing system.
Sec. 1307.053. COMPENSATION. Advisory board members may
not receive compensation for serving as a member.
SUBCHAPTER C. POWERS AND DUTIES OF DEPARTMENT AND COMMISSION
Sec. 1307.101. GENERAL POWERS AND DUTIES. The department,
executive director, or commission, as appropriate, may take action
as necessary to administer and enforce this chapter.
Sec. 1307.102. RULES. The commission shall adopt rules as
necessary to administer this chapter, including rules relating to:
(1) licensing roofing contractors and establishing
standards of conduct for license holders, including the display of
a license by a license holder;
(2) investigating and resolving complaints filed
under this chapter;
(3) establishing the minimum financial responsibility
requirements for license holders;
(4) administering a licensing examination; and
(5) prohibiting false, misleading, or deceptive
advertising practices by license holders.
Sec. 1307.103. CRIMINAL HISTORY BACKGROUND CHECK. The
department may obtain criminal history record information under
Subchapter F, Chapter 411, Government Code, for an applicant for or
holder of a license under this chapter. For purposes of Section
411.093, Government Code, an applicant for or holder of a license
under this chapter includes a controlling person of an applicant or
holder.
Sec. 1307.104. LICENSE HOLDER DATABASE. The commission
shall make available on its Internet website a publicly accessible
list of licensed roofing contractors. The list must contain the
following for each licensed roofing contractor:
(1) contact information for the contractor;
(2) a statement indicating whether the contractor is
licensed in good standing;
(3) a summary of any disciplinary action taken by the
commission against the contractor; and
(4) any other information that the commission
determines is relevant.
SUBCHAPTER D. LICENSE REQUIREMENTS
Sec. 1307.151. LICENSE REQUIRED. (a) A person may not act
as or offer to act as a roofing contractor unless the person holds a
license issued under this chapter.
(b) A license:
(1) is valid only with respect to the person or company
named on the license; and
(2) authorizes the license holder to operate one
roofing contractor business for each license.
(c) A license issued under this chapter is not transferable
or assignable.
Sec. 1307.152. APPLICATION; APPLICATION FEE. (a) An
applicant for a license must:
(1) apply to the department on a form prescribed by the
executive director and under rules adopted by the commission;
(2) submit with the application a nonrefundable
application fee in an amount set by the commission; and
(3) pass an examination adopted by the department.
(b) The commission by rule shall specify the information
that must be included on an application submitted to the
department. The rules must require each application to include:
(1) the name and address of, and an authorization for
the department to obtain criminal history record information for,
each controlling person; and
(2) evidence that the applicant satisfies the minimum
financial responsibility requirements established by commission
rule.
Sec. 1307.153. TERM OF LICENSE. A license issued under this
chapter is valid for one year.
Sec. 1307.154. EXAMINATION. (a) An examination required
by this chapter shall be conducted at locations throughout the
state.
(b) The department shall accept, develop, or contract for
the examination required by this chapter, including the
administration of the examination. Each examination must test the
knowledge of the applicant about basic contracting principles and
roofing services.
(c) The executive director shall determine uniform
standards for acceptable performance on an examination.
SUBCHAPTER E. PRACTICE BY LICENSE HOLDER
Sec. 1307.201. DISPLAY OF LICENSE INFORMATION. (a) A
roofing contractor shall display the contractor's business name and
the number of the license issued by the executive director on each
vehicle owned by the contractor and used in providing roofing
services.
(b) The information required to be displayed must be:
(1) printed in letters and numbers that are at least
two inches high and in a color that contrasts with the color of the
background surface; and
(2) affixed in conspicuous places on both sides of the
vehicle.
Sec. 1307.202. COMPLIANCE WITH LOCAL REQUIREMENTS. A
roofing contractor shall comply with local ordinances and
regulations relating to standards and permits for roofing services.
Sec. 1307.203. OBTAINING LICENSE UNDER ANOTHER NAME
PROHIBITED. (a) A person may not attempt to obtain a license under
any other name during any period during which the person's roofing
contractor license is suspended or revoked.
(b) Subsection (a) applies to any controlling person of a
business entity or other group whose license is suspended or
revoked.
Sec. 1307.204. NOTIFICATION OF CHANGE OF INFORMATION. A
roofing contractor shall timely notify the department of any change
to the name, address, business entity, liability coverage, or legal
service agent of the contractor.
Sec. 1307.205. PROHIBITED ACTS. A roofing contractor
providing roofing services to be paid by a consumer from the
proceeds of the consumer's property or casualty insurance policy
may not pay or rebate or promise to pay or rebate all or part of any
applicable insurance deductible.
Sec. 1307.206. CONFLICTS OF INTEREST PROHIBITED. (a) In
this section, "public insurance adjuster" has the meaning assigned
by Section 4102.001, Insurance Code.
(b) A roofing contractor may not act as a public insurance
adjuster for any property for which the contractor is providing
roofing services, regardless of whether the contractor holds a
license under Chapter 4102, Insurance Code.
(c) A roofing contractor is subject to the prohibitions
under Section 4102.158, Insurance Code.
SUBCHAPTER F. ENFORCEMENT
Sec. 1307.251. INVESTIGATION OF COMPLAINTS. (a) The
department shall investigate any complaint alleging that a
violation of this chapter or a rule adopted under this chapter has
occurred.
(b) A complaint must be filed in a manner prescribed by the
department.
Sec. 1307.252. ADMINISTRATIVE PENALTY. The commission or
executive director may impose an administrative penalty on a person
under Subchapter F, Chapter 51, regardless of whether the person
holds a license under this chapter, if the person violates:
(1) this chapter or a rule adopted under this chapter;
or
(2) a rule or order of the commission or executive
director.
Sec. 1307.253. SANCTIONS. The commission may impose
sanctions as provided by Section 51.353.
Sec. 1307.254. CRIMINAL PENALTY. (a) A person commits an
offense if the person:
(1) violates the licensing requirements of this
chapter; or
(2) performs roofing services without a license
required by this chapter.
(b) An offense under this section is a Class C misdemeanor.
SECTION 7. Section 233.152, Local Government Code, is
repealed.
SECTION 8. Chapter 152, Insurance Code, as added by this
Act, applies only to an insurance policy that is delivered, issued
for delivery, or renewed on or after January 1, 2014. A policy
delivered, issued for delivery, or renewed before January 1, 2014,
is governed by the law as it existed immediately before the
effective date of this Act, and that law is continued in effect for
that purpose.
SECTION 9. (a) Except as provided by Subsection (b) of this
section, Subchapter F, Chapter 233, Local Government Code, as
amended by this Act, applies only to new residential construction
that commences on or after the effective date of this Act.
(b) In a county that, before the effective date of this Act,
required notice under Section 233.154(b), Local Government Code, as
it existed before amendment by this Act, Subchapter F, Chapter 233,
Local Government Code, as amended by this Act, applies only to new
residential construction for which notice was given on or after the
effective date of this Act.
SECTION 10. Not later than February 1, 2014, the Texas
Commission of Licensing and Regulation, the Texas Department of
Licensing and Regulation, and the executive director of the Texas
Department of Licensing and Regulation, as appropriate, shall adopt
rules and forms necessary to implement Chapter 1307, Occupations
Code, as added by this Act.
SECTION 11. The Texas Department of Licensing and
Regulation shall issue a roofing contractor license under Chapter
1307, Occupations Code, as added by this Act, to an applicant who:
(1) applies for a license under this section not later
than June 1, 2014;
(2) submits to the department the information required
by rule;
(3) has at least 10 years of experience performing
roofing services as defined by Section 1307.002, Occupations Code,
as added by this Act; and
(4) pays the application fee established by the Texas
Commission of Licensing and Regulation.
SECTION 12. (a) Except as provided by Subsection (b) of
this section, this Act takes effect September 1, 2013.
(b) Section 1307.151, Occupations Code, and Subchapters E
and F, Chapter 1307, Occupations Code, as added by this Act, take
effect September 1, 2014.