HB 1459-FN-A – AS AMENDED BY THE HOUSE
06Feb2008… 0359h
2008 SESSION
05/09
HOUSE BILL 1459-FN-A
AN ACT relative to modular building standards and fees.
SPONSORS: Rep. Chandler, Carr 1; Rep. Merrow, Carr 3; Rep. Buco, Carr 1; Rep. Butler, Carr 1
This bill:
I. Requires the department of safety to certify manufacturers and third party inspectors of modular buildings.
II. Requires licensure of dealers and installers of modular buildings.
III. Establishes the modular building board to regulate modular building practices in the state.
IV. Requires persons who sell or lease modular buildings to provide the consumer with written notice of the complaint procedures.
V. Requires the dealer to provide the retail buyer of a presite or prefabricated home with a copy of the manufacturer’s warranty.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
06Feb2008… 0359h
08-2325
05/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eight
AN ACT relative to modular building standards and fees.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Definition of Approved Third Party Inspection Agency and Board. Amend RSA 205-C:1, I to read as follows:
I. “Approved third party inspection agency” means an entity or organization, public or private, [determined] certified by the department to be qualified by reason of facilities, personnel, experience, and demonstrated reliability and independence of judgment, to evaluate and certify building manufacturers and factory assembled modular construction.
I-a. “Board” means the state modular building board established in RSA 205-C:9.
2 New Paragraph; Definition of Dealer. Amend RSA 205-C:1 by inserting after paragraph V-a the following new paragraph:
V-b. “Dealer” means any person who engages in the business of retail selling or offering for sale, leasing, brokering, or distributing modular buildings, primarily to persons who purchase the buildings for residential use.
3 Definition of Installation. RSA 205-C:1, VII is repealed and reenacted to read as follows:
VII. “Installation” means the assembly of modular buildings on site and the process of affixing modular buildings or building components to the foundation at the building site. Installation includes installing basement lally columns, assembling and fastening structural components, including the manufacturer supplied roof system, and making the assembled building weathertight.
4 New Paragraph; Definitions of Installer. Amend RSA 205-C:1 by inserting after paragraph VII the following new paragraph:
VII-a. “Installer” means a person engaged in the business of installing or servicing state certified modular buildings.
5 New Paragraph; Definition of Licensee. Amend RSA 205-C:1 by inserting after paragraph VIII the following new paragraph:
VIII-a. “Licensee” means a person licensed by the board as a dealer or installer.
6 Definition of Modular Building. Amend RSA 205-C:1, XI to read as follows:
XI. “Modular building” means any building of closed construction, which is made or assembled in manufacturing facilities off the building site, for installation, or assembly and installation, on the building site. This definition includes presite built housing as defined in RSA 674:31-a. This definition shall not be construed to include any structure labeled in accordance with the Federal Manufactured Housing Construction and Safety Standards Act of 1974, nor shall it include any recreational vehicle or park trailer as defined in American National Standards Institute A119.2, Standard for Recreational Vehicles, or A119.5, Standard for Park Trailers, or any building type not subject to the requirements of nationally recognized model building codes.
7 Modular Building Standard. Amend RSA 205-C:2, II to read as follows:
II. All modular buildings and building components bearing a label of certification pursuant to the requirements of this chapter shall be deemed by local enforcement agencies as meeting the modular building code, however, such certification shall not be deemed to preempt enforcement of any state or local standards governing [installation or] work performed on the building site, including but not limited to site grading, foundations, driveways, on-site water and sewer systems or connections to off-site systems, and electrical line connections to the power source.
8 Certification of Modular Buildings, Third Party Inspectors, and Manufacturers Required. RSA 205-C:3 is repealed and reenacted to read as follows:
205-C:3 Certification of Modular Buildings, Third Party Inspectors, and Manufacturers Required.
I. No person shall sell, lease, or install for use in this state any modular building or building component unless such building or building component bears a label of certification issued by the department.
II. No person shall engage in the practice of third party inspection of any modular building or building component for use in this state unless such person has been certified by the department.
III. No person shall manufacture for use in this state any modular building or building component, unless such person has been certified by the department.
9 Rulemaking. RSA 205-C:4 is repealed and reenacted to read as follows:
205-C:4 Rulemaking. The commissioner shall adopt rules under RSA 541-A relative to:
I. Requirements for the certification of third party inspection agencies by the department.
II. Requirements for approved third party inspection agency certification of the manufacturing facilities of any person who engages in the business of manufacturing modular buildings or building components for installation in this state.
III. Requirements for approved third party inspection agency certification and labeling or modular buildings and building components for sale, lease or installation in this state.
IV. Investigation of complaints of noncompliance by certified manufacturers and certified third party inspection agencies.
V. Enforcement procedures, including standards for revocation and suspension of certification.
VI. Imposition and collection of fees, administrative fines, and penalties for certification.
10 Fees. Amend RSA 205-C:6 to read as follows:
205-C:6 Fees. The commissioner shall by rule establish fees to defray the costs of administering the certification programs established under this chapter. Such rules shall specify fees for the certification of third party inspection agencies by the department; certification of manufacturing facilities by approved third party inspection agencies; [and] certification of modular buildings and building components by approved third party inspection agencies; and renewal fees, late fees, and fees for reinstatement of certification. All fees collected by the department shall be deposited into the general fund.
11 New Sections; Licensing of Dealers and Installers; Modular Building Board Established. Amend RSA 205-C by inserting after section 7 the following new sections:
205-C:8 License Required.
I. No person shall sell, lease, broker, or distribute for use in this state, any modular building or building components unless such person is licensed as a “dealer” by the board.
II. No person shall install for use in this state, any modular building of building components unless such person is licensed as an “installer” by the board.
III. Employees or subcontractors working under the direction of a licensee shall not be required to be licensed under this chapter.
IV. Notwithstanding paragraph II, a consumer who installs a modular building for his or her personal residential use shall not be required to be licensed under this chapter. Persons working under the direction of the consumer shall not be required to be licensed under this chapter, although such persons shall be required to be licensed under any other applicable licensing law or regulation. The consumer shall sign a form, to be filed with the board, stating that the manufacturer’s warranty in RSA 205-B:2 applies to the building.
205-C:9 Board Established; Members; Terms; Chairperson; Compensation.
I. There is hereby created a state modular building board consisting of the commissioner of the department of safety or the commissioner’s designee and 8 additional members appointed by the commissioner of safety as follows:
(a) Two public members who are not in any way associated with the modular housing industry.
(b) One installer of modular housing, nominated by the New Hampshire Manufactured and Modular Housing Association.
(c) One structural engineer or architect licensed in this state for a minimum of 5 years, nominated by the board of professional engineers established under RSA 310-A:3.
(d) One dealer, nominated by the New Hampshire Manufactured and Modular Housing Association.
(e) One builder, nominated by the New Hampshire Homebuilders and Remodelers Association.
(f) One manufacturer of modular housing, nominated by the New Hampshire Manufactured and Modular Housing Association.
(g) One municipal building code official, nominated by the New Hampshire Building Officials Association.
II. The state fire marshal or the fire marshal’s designee shall be a non-voting member of the board.
III. Each person shall serve for a 3-year term and until a successor is appointed and qualified; provided, however, that the initial appointments shall be as follows:
(a) Members appointed pursuant to subparagraphs I(a), (b), (c),and (d) shall serve 3-year terms.
(b) Members appointed pursuant to subparagraphs I(e), (f), (g) shall serve 2-year terms.
IV. At the initial organizational meeting of the board, the commissioner shall appoint a chairperson from among the members.
V. Any vacancy on the board shall be filled for the remainder of the unexpired term.
VI. The board shall hold meetings every 90 days and may meet more frequently as deemed necessary by a majority vote of the board or the chairperson. A quorum of the board shall consist of not less than 4 members.
VII. The board shall be administratively attached to the department of safety.
VIII. Members of the board shall serve without compensation, but shall be reimbursed for their legitimate expenses incurred in the performance of their duties.
205-C:10 Duties of the Board. The board shall:
I. Assess compliance with state adopted codes and standards, including the state building and fire codes, as amended.
II. Establish licensing and training standards for dealers and installers.
III. Require appropriate inspections of the installation of modular buildings in conjunction with local enforcement agencies and the state fire marshal.
IV. Provide a fair and effective recourse for consumers through the complaint process established in RSA 205-C:12; and provide a dispute resolution program for timely resolution of disputes between consumers, manufacturers, dealers, and installers that arise during the one-year period beginning on the date of installation.
205-C:11 Inspectors; Certificate of Occupancy.
I. The local enforcement agency, or if there is no local enforcement agency, the state fire marshal or the state fire marshal’s designee, shall:
(a) Conduct appropriate inspections to ensure compliance throughout the state with installation practices consistent with the provisions of this chapter and rules adopted under this chapter.
(b) Enter any premises on which an installation is being or has been completed subject to regulation under this chapter for the purpose of making such inspection as is necessary to carry out his or her duties under this chapter. Inspections shall be done prior to occupancy of the modular building.
(c) Order the correction of any violation of this chapter, or rule adopted under this chapter.
(d) Order any installer to discontinue installation until the violations are corrected.
(e) Approve the continuation of work on the installation upon being satisfied that violations have been corrected.
(f) Issue a certificate of occupancy upon satisfaction that a modular building has been installed in compliance with this chapter and the rules adopted under this chapter.
II. Whenever a local enforcement agency, or if there is no local enforcement agency, the state fire marshal or the state fire marshal’s designee, orders the correction of a violation under subparagraph I(c), he or she shall immediately notify the board.
III. A certificate of occupancy shall be required for occupancy.
IV. Any installer aggrieved under the provisions of this section may file a complaint in accordance with RSA 205-C:12.
205-C:12 Complaints.
I. A consumer, manufacturer, dealer, or installer aggrieved or having a dispute regarding the installation of a modular building may file a complaint with the board.
II. All complaints shall be in writing and reviewed by the board.
III. To be accepted for filing, complaints shall be filed on a form provided by the board.
IV. All complaints shall be filed with the board within one year of the date of occupancy.
V. If the board determines that a complaint requires further investigation, it shall be acted upon within 60 days. The board shall establish procedures for expedited hearings on complaints where the circumstances set forth in the complaint warrant it.
VI. Upon confirmation that a complaint complies with this section, the board shall schedule a hearing on the complaint in accordance with the provisions of RSA 541-A.
VII. Disposition of all complaints shall be voted on by the board.
205-C:13 Qualifications for License. The board shall issue a license to any applicant who, at a minimum:
I. Has attained the age of 18.
II. Has 2 years experience as a dealer or installer or proves to the board’s satisfaction equivalent installation experience.
III. Has successfully completed 8 hours of training on modular building construction and the state building and fire codes.
IV. Complies with the requirements of RSA 205-C:14.
205-C:14 Financial Requirements of Licensees.
I. The board shall not issue a license to any person, unless the person has posted a letter of credit, proof of products/completed operations liability insurance, or surety bond to be held by the state treasurer in an amount of:
(a) $300,000 for an installer; or
(b) $1,000,000 for a dealer.
II. No letter of credit, proof of products/completed operations liability insurance, or surety bond shall be accepted unless it is with a company authorized to do business in this state.
III. Any person who is damaged by any violation of this chapter may bring an action against the letter of credit, liability insurance, or bond to recover damages suffered and any other amounts allowable by law. The attorney general, in any action brought under this chapter or any other applicable provisions of the law, may likewise proceed against the letter of credit, liability insurance, or bond.
205-C:15 Application for License.
I. Applications for licensure shall be made on forms adopted by the board.
II. Applications for licensure shall be accompanied by proof of financial requirements as required by this chapter, and payment of the license fee.
III. The board may require each applicant to provide additional information about the applicant’s background and trustworthiness as is reasonably necessary.
205-C:16 Expiration and Renewal.
I. All licenses issued by the board shall expire on the last day of the month of the licensee’s birth, but may be renewed during the following month, retroactive to the first day of the month. Upon failure to pay the renewal fee within the required period, a licensee may renew his or her license retroactive to the first of the month, by submitting the required fee plus a late fee before the last day of the second month following the month of his or her birth.
II. Persons licensed as dealers or installers are eligible for renewal of their licenses if they:
(a) Are not in violation of this chapter;
(b) Meet any requirements for continuing education established by the board in rules adopted pursuant to RSA 541-A; and
(c) Submit evidence of compliance with the financial requirements in RSA 205-C:14.
205-C:17 Fees.
I. The board shall establish, pursuant to RSA 541-A, fees for license applications, licensure, license renewal, reinstatement of licensure, and late renewal of licensure, inspections conducted by the state fire marshal, and the installer’s warranty seal.
II. The fees established by the board shall be sufficient to produce estimated revenues equal to 125 percent of the direct operating expenses of the board for the previous fiscal year.
III. The fee for the installer’s warranty seal shall not exceed $50.
IV. The fee for inspections carried out by the state fire marshal shall not exceed $100.
V. The board shall establish fees for the first year of its operation based upon its estimate of expenses necessary to carry out the provisions of this chapter during that fiscal year. The comptroller is authorized upon request of the department of safety to establish necessary budgetary components and operating accounts in the department and to transfer revenues received from the fees in this section and in RSA 205-C:6 to the department to carry out the responsibilities of the board and the responsibilities of the state fire marshal in conducting inspections under this chapter.
VI. If an inspection is conducted by a local enforcement agency, the local enforcement agency may charge fees established pursuant to RSA 674:51, III(d).
205-C:18 Disciplinary Action.
I. The board may undertake disciplinary proceedings:
(a) Upon its own initiative; or
(b) Upon a sworn written complaint of any person which charges that a licensee has committed misconduct under paragraph II and which specifies the grounds therefor.
II. Conduct sufficient to support disciplinary proceedings under this section shall include, but is not limited to, any of the following:
(a) The practice of fraud or deceit in procuring or attempting to procure a license to practice under this chapter.
(b) Willful or repeated violation of the provisions of this chapter.
(c) Suspension or revocation of a license similar to one issued under this chapter in another jurisdiction and which has not been reinstated.
III. The board may take disciplinary action in any one or more of the following ways:
(a) By reprimand.
(b) By suspension, limitation, or restriction of license for a period of up to 5 years.
(c) By revocation of license.
(d) By requiring the person to participate in a program of continuing education in the area or areas in which he or she has been found deficient.
(e) By imposing a fine not to exceed $1,500 for each offense.
205-C:19 Hearings. The board shall take no disciplinary action without a hearing. At least 14 days prior to hearing, both parties to a disciplinary proceeding shall be served, either personally or by registered mail, with a written copy of the complaint filed and notice of the time and place for hearing. All complaints shall be objectively received and fairly heard by the board. A hearing shall be held on all written complaints received by the board within 90 days of the date that notice of a complaint was received by the accused, unless otherwise agreed to by the parties. Written notice of all disciplinary decisions made by the board shall be given to both parties to the proceeding upon their issuance.
205-C:20 Penalty. Any person acting as a dealer or installer without a license, or knowingly or willingly violating any of the provisions of this chapter, shall be guilty of a class B misdemeanor if a natural person, or a felony if any other person.
205-C:21 Consumer Protection Act. Nothing in this chapter shall preclude an aggrieved party from seeking redress under RSA 358-A, the consumer protection act, for any unfair or deceptive trade practice committed relative to the selling, leasing, brokering, distributing, or installation of modular buildings.
205-C:22 Warranty Seal. Prior to finalizing the installation of a modular building in this state, the installer shall first obtain from the board an installer’s warranty seal and attach the seal to the modular building.
205-C:23 Rulemaking Authority. With the approval of the commissioner, the board shall adopt rules under RSA 541-A relative to:
I. The design and content of all forms and applications required under this chapter.
II. The application procedure for a license to practice under this chapter.
III. The qualifications of license applicants set under this chapter.
IV. How an applicant shall be trained, including the minimum education requirements and training standards.
V. How a license to practice under this chapter shall be renewed, including any requirements for continuing education.
VI. The establishment of fees required under this chapter.
VII. Ethical and professional standards required to be met by each holder of a license to practice under this chapter and how disciplinary actions by the board shall be implemented for violations of these standards.
VIII. The establishment of complaint procedures, including investigations and expedited hearings procedures.
IX. Procedures for the conduct of hearings consistent with the requirements of due process.
X. The establishment of a program for the timely resolution of disputes between manufacturers, dealers, and installers regarding responsibility, for the issuance of appropriate orders, and for the correction or repair of defects in modular buildings that are reported during the one-year period following the date of installation.
12 New Section; Notice of Complaint Procedures. Amend RSA 205-C by inserting after section 3 the following new section:
205-C:3-a Notice of Complaint Procedures. Any person who sells or leases a modular building or building component in this state shall provide the consumer with written notice of the complaint procedures, adopted by rule under RSA 205-C:4, IV, and contact information for the state modular building board established in RSA 205-C:9 and the modular building inspector or other person authorized by the department to receive complaints.
13 Warranty on Presite and Prefabricated Homes. Amend the introductory paragraph of RSA 205-B:2 to read as follows:
205-B:2 Manufacturer’s Warranty. No person shall sell at retail a new prefabricated or presite built home in this state without a written manufacturer’s warranty to the buyer which shall be presented to the retail customer and which shall include the following terms:
XI. The establishment of financial requirements as set forth under this chapter.
14 Applicability. To allow time for the establishment of the modular building board and for implementation of this act, no dealers or installers shall be required to be licensed pursuant to this act until 90 days after the board has adopted rules pursuant to RSA 205-C:23. On or before July 1, 2009, the board shall initiate rulemaking proceedings in accordance with RSA 541-A.
15 Repeal. RSA 205-C:5, relative to interagency coordination for certification of modular buildings, is repealed.
16 Effective Date. This act shall take effect 60 days after its passage.
LBAO
08-2325
Amended 02/26/08
HB 1459 FISCAL NOTE
AN ACT relative to modular building standards and fees.
FISCAL IMPACT:
The Department of Safety states this bill, as amended by the House (Amendment #2008-0359h), will increase state general fund revenue and expenditures by an indeterminable amount in FY 2009 and each fiscal year thereafter. There will be no fiscal impact on county and local revenue and expenditures.
METHODOLOGY:
The Department of Safety states this bill requires dealers, installers, manufacturers, and third party inspectors of modular buildings to be certified and establishes the Modular Building Board. The Department estimates 300 entities will pay certification fees of $100 per year beginning in FY 2009, increasing state general fund revenue by $30,000 per year.
The Department further states an additional executive secretary position (labor grade 11) would be required to implement the provisions of this bill. The Department states expenditures related to this position would be as follows:
FY 2009 FY 2010 FY 2011 FY 2012
Salary $24,921 $26,540 $27,515 $28,646
Benefits (48.3%) $12,037 $12,819 $13,290 $13,836
Current Expense $6,000 $6,000 $6,000 $6,000
Equipment $4,500 - - -
TOTAL $47,458 $45,359 $46,805 $48,482
This bill does not establish an additional position or appropriate funds.
The Modular Building Board is required to establish fees sufficient to produce estimated revenues equal to 125 percent of the Board’s direct operating expenses. The Board is charged with establishing fees associated with dealer and installer licensure and renewal; the fee for installer’s warranty seal, which shall not exceed $50; and the fee for inspections carried out by the state fire marshal, which shall not exceed $100. The bill states no dealers or installers will be required to be licensed until 90 days after the Board has adopted rules, with rulemaking proceedings needing to be initiated on or before July 1, 2009. The increase in state revenue and expenditures is indeterminable.