NDT S.B. 229 75(R)BILL ANALYSIS


LICENSING & ADMINISTRATIVE PROCEDURES
S.B. 229
By: Carona (Kubiak)
5-20-97
Committee Report (Amended)



BACKGROUND 

The Air Conditioning and Refrigeration Contractor License Law (Article
8861, V.T.C.S.) requires those persons engaging in environmental air
conditioning, commercial refrigeration, or process heating or cooling to
be examined and licensed by the State of Texas.  S.B. 229 sets forth
regulations and penalties pertaining to air conditioning and refrigeration
contracting that are related to the need for establishing certain license
practices and enforcing contracts. 

PURPOSE

S.B. 229 sets forth regulations and penalties pertaining to air
conditioning and refrigeration contracting. 

RULEMAKING AUTHORITY

Rulemaking authority is granted under SECTION 5, The Air Conditioning and
Refrigeration Contractor License Law (Article 8861, Vernon's Texas Civil
Statutes) of this bill.  
 
SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Sections 2(7) and (9), Article 8861, V.T.C.S. (Air
Conditioning and Refrigeration Contractor License Law) to redefine "air
conditioning and refrigeration maintenance word" and "air conditioning and
refrigeration contracting." 

SECTION 2.  Amends Section 3(e), Article 8861, V.T.C.S., to requires the
examinations to be offered on a quarterly basis at locations designated by
the Texas Commissioner of Licensing and Regulation (commissioner), 

SECTION 3.  Amends Section 3A, Article 8861, V.T.C.S., by adding
Subsection (i), to provide that Section 8, Article 6252-33, V.T.C.S., does
no apply to the Air Conditioning and Refrigeration Contractors Advisory
Board (advisory board). 

SECTION 4.  Amends Section 3B, Article 8861, V.T.C.S., as follows:

 Sec. 3B.  New heading:  LICENSE REQUIRED; CITATION.  Authorizes a
representative of the Department of Licensing and Regulation (department)
or a    municipal official to issue a citation to a person who performs
air conditioning and  refrigeration contracting without a license issued
under this Act.  Provides that the  municipal court has concurrent
jurisdiction with a justice court of a precinct in which the  municipality
is located in a case arising from a citation issued under this subsection
to the  extent authorized by Chapter 29, Government Code.  Makes a
conforming change. 

SECTION 5.  Amends Article 8861, V.T.C.S., by adding Section 3C, as
follows: 

 Sec.  3C.  ENFORCEMENT OF CONTRACTS.  Prohibits a person who performs air
conditioning and refrigeration contracting without holding the appropriate
license from  collecting a fee or otherwise enforcing a contract for the
services performed.  Requires a  person to present proof that the person
holds license at the time the contract is signed and  the work performed
in order to enforce a contract.  Requires the commissioner to adopt  rules
relating to the manner in which proof may be presented under this section. 

SECTION 6.  Amends Section 4(f) and (g), Article 8861, V.T.C.S., to delete
text requiring an application to be accompanied be evidence of the
insurance coverage required under this Act. Requires the commissioner ro
issue an air conditioning and refrigeration contractor licence to a person
who furnishes evidence of the insurance coverage and performs certain
activities required under this Act.  Makes conforming and nonsubstantive
changes. 

SECTION 7.  REPORTING REQUIREMENT.  Amends Section 7, Article 8861,
V.T.C.S., to require each air conditioning and refrigeration contractor,
rather that person, to notify the corresponding municipal authority that
the person has obtained a state license.  Authorizes the amount of a fee
imposed on a contractor to be set by the municipality only in the amount
reasonable and necessary to implement this section.  Makes conforming
changes. 

SECTION 8.  Amends Section 8, Article 8861, V.T.C.S., to provide that a
person commits a Class A, rather that Class B, misdemeanor if the person
knowingly and intentionally engages in air conditioning and refrigeration
contracting without a license. 

SECTION 9.  Amends Section 9, Article 8861, V.T.C.S., to provide that a
license issued by a municipality of this state that complies with the
requirements of this section is valid under the terms of the license
within that municipality.  Requires an applicant for a municipal license
to pass an examination and meet specific experience requirements  Makes a
conforming change. 

SECTION 10.  Amends Section 23(c), Article 6573a, V.T.C.S., (The Real
Estate License Act) by adding Subdivision (4), to require a business
entity that inspects certain systems as part of a real estate inspection
to employ a person who holds the appropriate air conditioning and
refrigeration contractor licenses and endorsements under Article 8861,
V.T.C.S.  Authorizes an employee who does no hold a license or endorsement
to perform the inspection under the direction of the license holder.
Defines "inspection." 

SECTION 11.  Amends Section 25, Article 6573b, V.T.C.S., (Residential
Service Company Act) to provide that any person who performs air
conditioning refrigeration in compliance with the Air Conditioning and
Refrigeration Contractor License Law, Article 8861, V.T.C.S., is exempt
from the provisions of this Act.  Makes a conforming change. 

SECTION 12.  Makes application of this Act prospective.

SECTION 13.  Provides that the change in law made to SECTION 9, Article
8861, V.T.C.S., excerpt as provided by Subsection (b), prospective.
Requires a municipality to adopt examination  requirements in compliance
with this section not later that January 1, 1998. Requires a person who
holds a municipal license to satisfy the examination requirements imposed
under Section 9(b), Article 8861, V.T.C.S., not later that June 1, 1998. 

SECTION 14.  (a) Effective date:  September 1, 1997.

 (b) Requires the commissioner of licensing and regulation to adopt rules
as required by  Section 3C, Article 8861, V.T.C.S., not later that
December 31, 1997. 

 (c) and (d)  Make application of this Act prospective.

SECTION 15.  Emergency clause.

EXPLANATION OF AMENDMENTS

Committee Amendment #1 amends Section 7 on page 6, line 5, after "on" add
"residential"; after "evaporate coolers" add "up to and including 6,500
cubic feet per minute (cfm)" 

Committee Amendment #2 amends SECTION 1, pg.1, line 9, (6) "Person" means
an individual,  a firm, partnership, corporation, association or other
organization, or any combination of any thereof. 

In SECTION 1 of the bill, insert an new Subsection 14 and 15 as follows:

(14) "Air conditioning and refrigeration contracting company" means any
person, corporation, partnership, association, or other entity that
performs air conditioning and refrigeration contracting. 

(15) "Direct Personal Supervision" means directing and verifying work
requiring a license under the Act by means of hiring, training, and
consulting with employees, personally observing and checking work of
employees, and having responsibility for handling customer complaints. 

Committee Amendment #3 amends SECTION 4, by amending Sec 3B as follows:

(a) Unless the person is exempted under Section 6 of this Act, a person
may not perform air conditioning and refrigeration contracting without a
license under this Act.  A person is not required to be individually
licensed under the Act if the person is a bona fide employee of a company
which has a license holder who has direct personal supervision over him or
her. 

(b) An air conditioning and refrigeration contracting company that is not
exempt under the Act must employ a license holder(s) in each permanent
office whose license is assigned to that company. 

In SECTION 7, Amend as follows:

(g) A person who assists in the performance of air conditioning and
refrigeration contracting work under the supervision of a licensee as a
bona fide employee is not required to be licensed. 

Committee Amendment #4 amends Committee Amendment #3 as follows:

(b) An air conditioning and refrigeration contracting company that is not
exempt under the Act must employ a license holder(s) in each permanent
office whose license is assigned to that company. 

Committee Amendment #5 amends Page 1, line 22 as follows:  "The term
includes cleaning equipment and duct materials as required for the proper
operation of such a system."