By: Parker S.B. No. 1955
 
 
 
   
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the regulation of 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
  have derived(?) new, innovative housing
  construction techniques, including modular and
  complete residential building systems, from
  preapproved components or modules that are
  manufactured off-site, then 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; and
               (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 only to a
  municipality with a population of 300,000 or more. 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.
               (4)  "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.
               (5)  "Code compliance certificate" means the
  certificate provided 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, and the International Association of Plumbing and
  Mechanical Officials.
               (6)  "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.
               (7)  "Installation" means the assembly of a modular
  residential dwelling or dwellings onsite and/or the process of
  affixing a modular residential dwelling or dwellings, which may
  include the structural, electrical, mechanical, plumbing, fire
  protection, or other structurally integrated system or systems
  thereof affecting life safety.
               (8)  "Installer" means a company or general contractor
  certified by the department that is responsible for design,
  engineering, manufacturing, and installation of the components for
  a modular residential dwelling unit at the final onsite location
  pursuant to the Original Building Manufacturer's (OBM)
  instructions.
               (9)  "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.
               (10)  "Complete application" means a submitted plan,
  application for construction of a modular residential dwelling, or
  request for inspection that contains all the information and
  supporting documentation required by the county or municipality to
  enable making the determination as to whether the plan,
  application, or request is in compliance with regulatory
  requirements of this Act and department rules.
               (11)  "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 project 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.
               (12)  "Modular Residential Dwelling Fund" (Fund) means
  a fund established within the department's budget, consisting of
  fines and penalties, subject to appropriation, to 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 within the prescribed 30-day period, the
  application shall be deemed approved as a matter of law
  and the project may 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 and 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
  unit 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.