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