88R12060 TYPED
By: King of Hemphill H.B. No. 3892
A BILL TO BE ENTITLED
AN ACT
relating to the regulation and industrial Housing and buildings.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 7, Occupations Code, is
amended by adding a new Chapter 1203 to read as follows:
SECTION 1
CHAPTER 1203. MODULAR DWELLING SYSTEM REGULATION
Sec. 1203.001. LEGISLATIVE FINDINGS AND POLICY
a. The legislature finds that:
(1) there is a continuing need to provide safe,
affordable, and well-constructed housing;
(2) regulations in connection with industrial
housing, mobile homes, and manufactured homes, along with partial
building systems such as structurally insulated panels serve the
state well;
(3) private construction creativity and market forces
has driven new, innovative housing construction techniques,
including modular, complete residential building systems, from
preapproved, components or modules that are manufactured off-site,
transported to a site for final assembly and completion on a
permanent foundation;
(4) because of the nature of construction, modular,
complete residential building system assembly presents unique
opportunities to optimize uniform health and safety standards at
the place of manufacture, while minimizing inspection procedures
and time delays associated with traditional on-site inspection
procedures.
(5) there is a significant public benefit to
encouraging home ownership, by utilizing modular, complete
residential building construction techniques to address the
growing need for safe, affordable, and well-constructed housing;
Sec. 1203.002 SUBCHAPTER A. GENERAL PROVISIONS
Sec. 1203.003. APPLICABILITY OF CHAPTER. (a) Except as
otherwise provided by this chapter, this chapter applies
exclusively to a modular, complete residential dwelling for
residential occupancy by one or more families. Unless clearly
indicated otherwise by context, the following words and terms when
used by this chapter, shall have the following meanings.
Sec. 1203.003 GENERAL DEFINITIONS. In this chapter:
(1) "Commission" means the Texas Commission of
Licensing and Regulation.
(2) "Council" means the Texas Industrialized Building
Code Council.
(3) "Department" means the Texas Department of
Licensing and Regulation.
(4) "Executive director" means the executive director
of the department.
Sec. 1203.004 DEFINITIONS FOR MODULAR RESIDENTIAL
DWELLINGS. In this chapter:
(1) "Modular residential technique" means a method of
construction that utilizes a pre-engineered, complete building
assembly or system of building subassemblies, designed, built and
constructed in one or more three dimensional modules in a factory
that are transported to a residential site for assembly and
finishing.
(2) Modular Residential Dwellings" means a structure
designed and built for residential use and constructed using a
modular technique in one or more three dimensional modules in a
factory, designed, and built utilizing an agency approved method of
construction that consists of pre-engineered, inspection
factory-fabricated sections that are transported to a site for
final assembly and finishing to completion on a permanent
foundation for residential occupancy by one or more families and
including the necessary electrical, plumbing, heating,
ventilation, and other service systems, which is of closed
construction,. Modular residential dwelling does not include
mobile homes, recreational vehicles, or manufactured homes. A
modular residential dwelling located in Texas is regulated by the
Texas Department of Licensing and Regulation.
(3) "Approved foundation and support system" means,
for a modular residential dwelling unit, a closed perimeter
formation consisting of materials such as concrete, mortared
concrete block, mortared brick, steel, or treated lumber extending
into the ground.
(2) "Closed construction" is any residential building
component, assembly or system manufactured in such a manner that
all portions cannot readily be inspected at the installation site
with disassembly, damage to, or destruction thereof.
(3) "Code compliance certificate" means the
certificate provide by the manufacturer or builder to the
Department that warrants that the modular residential dwelling unit
complies with appropriate safety codes as established by the
Department. The Codes shall contain the standards and requirements
for modular residential dwellings so that adequate performance for
the intended use is made to test the acceptability, provided that
the structural requirements adopted for modular residential
dwellings shall be no more stringent than the requirements
contained in the most recent edition of the International
Residential Code for One and Two Family Dwellings or the
International Building Code, as applicable. The Code of Standards
shall permit the use of new technology, techniques, methods and
materials for modular residential dwellings, consistent with
recognized and accepted codes and standards developed by the
International Code Council, the National Fire Protection
Association, the International Association of Plumbing and
Mechanical Officials.
(4) "Approved Inspection Agency" means a person,
organization or local government approved by the executive director
to be especially qualified by reason of facilities, personnel,
experience, and demonstrated reliability, to investigate, test,
evaluate and inspect modular residential dwelling units, systems,
or the component parts of modular residential dwelling units
together with the plans, specifications, and quality control
procedures to ensure that such units, systems, or component parts
are in full compliance with the minimum standards adopted by the
executive director pursuant to this part and to label such units
complying with those standards. Any person, or any organization
whose membership is composed of persons, employed by a manufacturer
of modular residential dwelling units or owning any interest in any
such manufacturing business, shall be ineligible for approval by
the executive director to serve as an inspection agency.
(5) "Installation" means the assembly of a modular
residential dwelling or dwellings onsite and/or the process of
affixing a modular residential dwelling unit or dwellings, which
may include the structural, electrical, mechanical, plumbing, fire
protection, or other structurally integrated system or systems
thereof affecting life safety;
(6) "Installer" a company or general contractor
certified by the department that is responsible for design,
engineering, manufacturing, and installation the components for a
modular residential dwelling unit at the final onsite location
pursuant to the Original Building Manufacturer's (OBM)
instructions.
(7) "Person" means any individual, group of
individuals, association, trust, partnership, limited liability
company, corporation, person doing business under an assumed name,
county, municipality, the State of Texas, or any political
subdivision or department thereof, or any other entity.
(8) "Complete application" means a submitted plan,
application for construction of a modular residential building
unit, or request for inspection that contains all the information
and supporting documentation required by the county or municipality
for it to make the determination as to whether the plan,
application, or request is in compliance with regulatory
requirements of this Act and department rules.
(8) "Certification". The department shall issue an
authorizing certification to any manufacturer or installer upon
submittal of an application that is supported by affidavit in
addition to other evidence which the department deems necessary to
satisfy itself that the person meets the modular residential
dwelling criteria and that the project is compliant with this Act
and thereby approved to manufacture, install, rent, sell, or offer
for sale a modular residential dwelling.
(9) "Modular Residential Dwelling Fund", is a fund
established within the department's budget, consisting of fines and
penalties, subject to appropriation, be used for enforcement of
this Act.
Sec. 1203.005 PREREQUISITES TO SALE OR INSTALLATION (a)
After the effective date of the rules adopted pursuant to this part,
no modular residential dwelling shall be offered for sale, sold, or
installed in this state, unless it is approved and bears the
insignia of approval of the executive director, the executive
director's designee, or an approved inspection agency. It is
unlawful for any person to manufacture, rent, sell, or offer for
sale for location within this State, any modular residential
dwelling unless such modular residential dwelling complies with
this Act and all rules adopted by the department.
(b) All modular residential dwelling units manufactured in
this state, or intended to be offered for sale, sold, or installed
in this state, shall be inspected by the executive director, the
executive director's designee, or an approved inspection agency, at
the place of manufacture of the modular residential dwelling unit.
(c) No more than 30 days after receipt of both a modular
residential dwelling unit or project application and the affidavit
from a qualifying manufacturer, installer or construction
contractor, the department shall issue the requested authorization
or provide written notice to the applicant identifying the specific
plan features that do not comply with the applicable regulatory
requirements, as well as the specific code chapters and sections of
such regulatory requirements. If the department or any local
governing authority fails to provide written notice of alleged
deficiencies with the prescribed 30-day period, the permit
application shall be deemed approved as a matter of law and the
project can proceed.
(d) Nothing in this chapter prohibits a city, town, village,
or county from adopting construction standards for modular
residential dwelling units under local ordinances, provided such
ordinances are in substantial compliance with state requirements
and reviewed and approved by the department.
(e) No local standard relating to the construction or
installation of modular residential dwelling units shall be
applicable to any modular residential dwelling unit subject to this
part, unless such standard is identical to that set by the
department pursuant to this Chapter. Any residential modular
dwelling unit bearing an insignia of approval issued by the
executive director, the executive director's designee, or an
approved inspection agency pursuant to this part, shall be deemed
to comply with any local standard relating to the construction of
modular residential dwelling units.
(f) Subject to subdivision 1203.005(C), a local government
may make, and charge a fee for, an inspection of the installation of
a modular residential dwelling unit. Any such fee shall not exceed
the amount charged for the equivalent inspection on conventionally,
onsite, built housing.
(e) Local land use and zoning requirements, flood control
areas, are specifically and entirely reserved to local government.
Such local requirements and rules that may be enacted by a local
government must be reasonable and uniformly applied and enforced
without any distinction as to whether a residential dwelling is
conventionally, onsite, constructed or a modular residential
dwelling under this Chapter.
(f) Modular residential dwelling units bearing an insignia
of approval issued by the executive director, the executive
director's designee, or an approved inspection agency pursuant to
this part shall not be modified prior to or during installation,
except in conformance with the rules of the executive director.
(g) The department shall promulgate a standard form notice
and a standard form certificate that shall be used to administer
this Act. Any local inspectors shall make copies of the standard
forms available to contractors.
(h) Upon submission of the certification required by this
subsection, the local governing authority shall be required to
accept the inspection without the necessity of further inspection
or approval, except that the local governing authority may perform
an inspection at any time and may issue a stop-work order for the
project or any portion thereof as provided by law, after giving
prompt, written notice to the manufacturer or installer, or the
contractor of record, if the work is found to be in violation of
code requirements.
(i) If a local governing authority issues a stop-work order,
the local official shall be available to meet with the person
responsible for manufacturing, installing, or constructing the
modular residential dwelling unit within two-business days to
resolve any dispute.
Sec. 1203.006 POWERS AND DUTIES OF THE EXECUTIVE DIRECTOR
(A) The executive director shall enforce and administer this part.
(1) The executive director shall promulgate such rules
and regulations as the executive director finds necessary to
protect health and safety of the public against dangers inherent in
the use of substandard construction and unsafe plumbing, electrical
and heating systems, and other appropriate regulations to carry out
this part, in accordance with the Texas Administrative Procedures
Act found in Title 10, Chapter 2001, Texas Government Code.
(2) The executive director may impose an
administrative penalty against any person who violates this Act, or
any rule adopted under this Act, or who violates any determination
or order of the department under this Act. The department shall
establish violations and penalties by rule, with each day's
violation constituting a separate offense. The maximum penalty
shall be $1,000 per day per violation. All penalties collected
under this section shall be deposited into the "Modular Residential
Dwelling Fund", subject to appropriation, moneys in the Fund shall
be used for enforcement of this Act.
(3) The executive director is authorized to require
licenses of manufacturers, and any other person involved in the
construction, installation, sale, or lease of a modular residential
dwelling unit, and to set reasonable fees and conditions for such
licenses.
(4) The executive director may also establish record
keeping requirements from manufactures and installers.
(B) In addition to any other powers conferred on the executive
director by law, the executive director is authorized to perform
necessary inspection of manufacturing facilities and products to
implement the provisions of this Act, including:
(1) Prescribe all forms required to be filed pursuant
to this part;
(2) Establish a schedule of fees to pay the cost
incurred by the department for the administration and uniform
enforcement of the codes consistent with rules, regulations and
interpretations promulgated by the department;
(3) Appoint and employ such qualified personnel as are
necessary to carry out the duties imposed upon the executive
director by this part;
(4) Delegate inspection authority under this part, by
contract or other agreement, to local governments, private persons,
corporations, associations, and agencies of other states, as an
approved inspection agency; and
(5) After notice and opportunity for hearing to an
applicant or insignia holder, may deny, suspend, or revoke a
certification or asses a civil penalty not to exceed five thousand
dollars ($5,000) for each violation of this Act in any case where a
finding of substantial failure to comply with the provisions of
this Act or the minimum standards, rules and regulations adopted by
the department under this Act.
(6) All final administrative or civil penalty
decisions by the executive director shall be subject to judicial
review.
(C) If a modular residential dwelling is manufactured, sold, or
installed in violation of this part, the executive director may
require:
(1) The manufacturer or installer in violation of this
part to provide the executive director with as-built plans to be
evaluated and approved by the executive director for compliance
with state building codes;
(2) The manufacturer or installer in violation of this
part to make available for inspection any components and concealed
spaces of the structure and to repair any damages made when making
the components and concealed spaces available for inspection;
(3) Inspections to be made during the remanufacturing
process and may require that closed construction or concealed
spaces be opened or made accessible as necessary to determine that
components comply with state building codes; and
(4) The manufacturer or installer to be responsible
for all costs or expenses incurred pursuant to this subsection (c).
Sec. 1203.007 RECIPROCITY - INTERSTATE AGREEMENTS If the
executive director determines that the minimum standards for
construction and inspection of modular residential dwelling units
prescribed by statute or rule of another state are at least equal to
rules prescribed under this part and that such standards are
enforced by such other state, the executive director may negotiate
and enter into reciprocal agreements with appropriate officials of
other states.
SECTION 2. This Act does not make an appropriation. A
provision in this Act that creates a new governmental program,
creates a new entitlement, or imposes a new duty on a governmental
entity is not mandatory during a fiscal period for which the
legislature has not made a specific appropriation to implement the
provision.
SECTION 3. (a) As soon as practicable after the effective
date of this Act, the executive director of the Texas Department of
Licensing and Regulation shall adopt rules as necessary to
implement the changes in law made by this Act.
(b) As soon as practicable after the effective date of this
Act, the Texas Commission of Licensing and Regulation shall adopt
rules necessary to implement the changes in law made by Chapter
1203, as added by this Act.
SECTION 40. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2023.