By: Sheets H.B. No. 2693

A BILL TO BE ENTITLED

AN ACT

relating to the registration of roofing contractors; authorizing a fee and providing penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Title 20, Insurance Code, is amended by adding Chapter 6004 to read as follows:

CHAPTER 6004. ROOFING CONTRACTORS

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 6004.001. SHORT TITLE. This chapter may be cited as the Roofing Contractor Registration Act.

Sec. 6004.002. DEFINITIONS. In this chapter:

(2) "Agricultural use" means a use or activity involving agriculture, as defined by Section 11.002, Water Code, other than the processing of an agricultural commodity.

(3) "Commissioner" means the commissioner of insurance.

(5) "Department" means the Texas Department of Insurance."

(6) "Maintenance personnel" means an employee who performs maintenance work incidental to and in connection with other duties including the repair, maintenance and replacement of existing building systems and components. Such maintenance personnel shall not engage in roofing services for the general public.

(7) "Roofing contractor" means a person or business performing roofing services for compensation who:

(A) is an owner, officer, or director of a roofing business;

(B) possesses direct or indirect control of at least 10 percent of the voting securities of a roofing business 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 business;

(D) directly or indirectly possesses the power to direct or cause the direction of the management or polices of a roofing business; or

(E) has a direct or indirect interest in at least 10 percent of the profits, proceeds, or capital gains of a roofing business.

(8) "Roofing product" means any material commonly used in the construction, installation, or replacement of a commercial or residential roof.

(9) "Roofing services" means the installation, construction, maintenance, repair, alteration, or modification of a roofing product for a commercial or residential roof.

(10 "Remodeler" means a person who manages, oversees or carries out multiple structural alterations, in addition to the performance of roofing services, for an existing residential or commercial property for compensation.

Sec. 6004.003. 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) the owner or maintenance personnel of a commercial building;

(3) 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;

(4) 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;

(5) an employee while working for and acting under the supervision of a roofing contractor who holds a registration certificate under this chapter; or

(6) a builder of a newly constructed single family or multi-family residential dwelling or commercial structure.

(7) a remodeler of a single family or multi-family residential dwelling or commercial structure.

(b) Notwithstanding Subsection (a), a person described by Subsection (a)(6),(7) is subject to the requirements of this chapter to the extent the person provides roofing services other than those described by that subdivision.

Sec. 6004.004. CONSTRUCTION OF CHAPTER; CONFLICT WITH OTHER LAW. This chapter shall be construed to be in addition to any required registration 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.

[Sections 6004.005-6004.100 reserved for expansion]

SUBCHAPTER B. POWERS AND DUTIES OF DEPARTMENT AND COMMISSIONER

Sec. 6004.101. GENERAL POWERS AND DUTIES. The department or commissioner, as appropriate, may take action as necessary to administer and enforce this chapter.

Sec. 6004.102. RULES. The commissioner shall adopt rules as necessary to administer this chapter, including rules relating to:

(1) registration and renewal of registrations of roofing contractors;

(2) registration requirements for out of state roofing contractors.

(3) the display of a registration certificate by a registrant; and

(4) the form and manner of a complaint submitted to the department; including the investigation of complaints.

Sec. 6004.103. UNIFORM CONTRACT REQUIREMENT. The commissioner shall adopt rules necessary to establish the elements of a uniform contract which shall be made available for all registrants to use, if requested.

Sec. 6004.104 REQUIRED FINANCIAL DISCLOSURE. The commissioner shall adopt rules requiring registrants to disclose, in writing, whether or not a registrant carries insurance or maintains any other form of financial responsibility, including any form of liability coverage, surety bond, workers compensation coverage, or other coverage. This disclosure shall be made to any consumer for whom a registrant seeks to provide roofing services and must be made prior to the signing of a contract with a consumer.

Sec. 1307.105. REGISTRANT DATABASE. The department shall make available on its Internet website a publicly accessible list of registered roofing contractors. The list must contain the following for each registered roofing contractor:

(1) contact information for the contractor;

(2) a statement indicating whether the contractor is registered and in good standing;

(3) a summary of any known disciplinary action taken against the contractor; and

(4) any other information that the department determines is relevant.

[Sections 6004.106-6004.150 reserved for expansion]

SUBCHAPTER C. REGISTRATION REQUIREMENTS

Sec. 6004.151. REGISTRATION REQUIRED. (a) A person may not act as or offer to act as a roofing contractor unless the person holds a registration certificate issued under this chapter.

(b) A registration:

(1) is valid only with respect to the person or company named on the registration certificate; and

(2) authorizes the registrant to operate one roofing contractor business for each registration.

(c) a registration may not be transferred or assigned.

Sec. 6004.152. APPLICATION; APPLICATION FEE. (a) An applicant for registration must:

(1) apply to the department on a form prescribed by the commissioner and under rules adopted by the commissioner;

(2) submit with the application a nonrefundable application fee in an amount to be set by the commissioner.

(b) The commissioner 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 each controlling person.

Sec. 6004.153. TERM OF REGISTRATION AND RENEWAL. (a) Registration issued under this chapter is valid for one year.

(b) A renewal application must be filed by a roofing contractor at least 30 days prior to the expiration of each prior years registration.

(c) If a roofing contractor fails to file a renewal application at least 30 days prior to the expiration of the prior years registration then the roofing contractor's registration shall be deemed not in good standing.

(d) A roofing contractor has a thirty-day grace period to renew a registration beyond the expiration date.

(e) A roofing contractor who fails to renew a registration beyond the time provided in 6004.153 (d) shall have their registration revoked for failure to renew.

[Sections 6004.154-6004.200 reserved for expansion]

SUBCHAPTER D. PRACTICE BY REGISTRANT

Sec. 6004.201. DISPLAY OF REGISTRATION CERTIFICATE. (a) A roofing contractor shall display the contractor's business name and the number of the registration certificate issued by the commissioner 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. 6004.202. COMPLIANCE WITH LOCAL REQUIREMENTS. A roofing contractor shall comply with local ordinances and regulations relating to standards and permits for roofing services. Sec. 6004.203. OBTAINING A REGISTRATION UNDER ANOTHER NAME PROHIBITED. (a) A person may not attempt to obtain registration under any other name during any period during which the person's roofing contractor registration is suspended or revoked.

(b) Subsection (a) applies to any controlling person of a business entity or other group whose registration is suspended or revoked.

Sec. 6004.204. NOTIFICATION OF CHANGE OF INFORMATION. A roofing contractor shall timely notify the department of any change to the name, address, business entity, or legal service agent of the contractor.

Sec. 6004.205. WAIVER OF INSURANCE DEDUCTIBLE PROHIBITED. 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. 6004.206. MISREPRESENTATION AND DECEPTIVE ACTS PROHIBITED. A roofing contractor shall not engage in any fraudulent or deceptive acts or practices or misrepresentation of products, services, or qualifications of a roofing contractor.

SEC. 6004.207. CERTAIN CLAIMS HANDLING PROHIBITED. A roofing contractor shall not handle or advertise services to handle the adjustment of claims or losses on behalf of an insured.

Sec. 6004.206. 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, 4102.153, 4102.155 and 4102.161, Insurance Code.

[Sections 6004.207-6004.250 reserved for expansion]

SUBCHAPTER E. ENFORCEMENT

Sec. 6004.251. 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. 6004.252 ADMINISTRATIVE PENALTY. The commissioner may impose an administrative penalty on a person under Subchapter B, Chapter 84, regardless or whether the person is a registrant 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 department or commissioner.

Sec. 6004.253. PENALTIES. The commissioner may impose a penalty as provided by Section 84.022.

Sec. 6004.254. CRIMINAL PENALTY. (a) A person commits an offense if the person:

(1) violates the registration requirements of this chapter; or

(2) performs roofing services without the registration required by this chapter.

(b) An offense under this section is a Class C misdemeanor.

(c) More than one violation of this act during any twelve-month period shall be grounds for the suspension of a roofing contractors registration by the department.

(d) More than two violations of this act during any twelve-month period shall cause the registrant to be ineligible for registration for a period not to exceed twelve-months from the date of the last violation.

SECTION 2. Not later than February 1, 2014, the Texas Department of Insurance, the Commissioner of the Department of Insurance, as appropriate, shall adopt rules and forms necessary to implement Chapter 6004, Insurance Code, as added by this Act.

SECTION 3. (a) Except as provided by Subsection (b) of this section, this Act takes effect September 1, 2013.

(b) Section 6004.151, Insurance Code, and Subchapters E and F, Chapter 6004, Insurance Code, as added by this Act, take effect September 1, 2014.