Legislature(2003 - 2004)
03/27/2003 01:35 PM L&C
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
CSHB 9(FIN)am - HOME INSPECTORS/CONTRACTORS CHAIR BUNDE announced CSHB 9(FIN)am to be up for consideration. MS. HEATHER NOBREGA, staff to Representative Rokeberg, sponsor, said she would answer questions, but there were none. SENATOR DAVIS moved to adopt the Senate Labor and Commerce committee substitute to CSHB 9(FIN)am, version U. There were no objections and it was so ordered. SENATOR STEVENS moved to pass SCS CSHB 9(L&C) from committee with individual recommendations. SENATORS SEEKINS and FRENCH arrived at 1:44 p.m. CHAIR BUNDE announced that he had been notified that other people wanted to testify. MR. TERRY DUSZYNSKI, Fairbanks building inspector since 1978, said when this bill was introduced, it was about providing proper qualifications for home inspectors, insurance and continuing education. However, this bill seems to have gotten way out of control as far as what it's trying to accomplish. It is tying to dictate how an inspection is to be done it but doesn't provide everything that is necessary. On page 6, under existing homes, the provisions do not specify what code they refer to. Another concern is subsection (d) on page 6, which specifies that the inspection is valid for 180 days after the date the home inspector signs and dates the report. However, it doesn't keep home inspectors from being sued after six months. On page 10 the home inspector is held liable for two years on a new construction, yet the builder has only a one-year warranty on the house. He thought that was a little out of line. Page 18 contains a list of components of a residence that the inspector is liable for and includes built-in appliances, such as dishwashers and built-in ranges. He thought it goes too far in defining what inspectors are supposed to do. He said the language on page 20 is of most concern as it says that inspectors shall determine whether the construction conforms to relevant provisions of the construction codes of the municipality or of the state building code, as applicable, at each of the following stages of construction. There is no state building code for residential construction. The State of Alaska has adopted uniform building codes, but only for four-plexes and above. Now, home inspectors are going to be held liable for something that there is no state law to follow. All of the cities have different codes. Inspectors need to know what standards they will be held to when doing an inspection. MR. DAVE OWENS, Owens Inspection Service, said he has not supported the bill in the past, but he could if three amendments were adopted. One would be to consolidate and create an Alaska state residential building code and regulations for commercial building inspectors. He said this bill does not address the relationship between real estate agents and third-party inspectors. Liability is the biggest problem that most inspectors have. If this bill passes with this level of liability, a good percentage of the inspectors on the Alaska housing roster that perform new construction will go out of business. MS. CAROL PERKINS, Active Inspections, stated opposition to HB 9 and said the bill would open inspectors up to a lot of "lawyering." She pointed out the building department has a grievance process and the authority to adopt codes and make amendments so that the codes are adjustable to a local situation. MS. NOBREGA said the first concern is addressed on page 6, (b). She explained that the bill allows for a preinspection document, which talks about the expectations and what the home inspector will be doing, which can vary. This also applies to appliances. A home inspector might not look at appliances according to the preinspection document. She pointed out the 180-day validity of the report means that its accuracy is valid only for that period of time. She told members the provisions on page 10 for bringing a claim, one-year for an existing home and two-years for a new home, are from the statute of limitations of when a lawsuit can be brought. On page 20, the state building code language was inserted to cover the possible eventuality of getting one. MS. NOBREGA said Mr. Owens' concerns about liability are partially covered in a compromise. Because the bill repeals the AHFC provision, section 41, other provisions were inserted to limit inspectors' liability. One limits the length of the report's validity, another limits the one and two year period, and another limits who can sue them. Repealing section 41 does not open inspectors up to frivolous lawsuits. Now, a homeowner can only sue for gross negligence or intentional misconduct. Section 41 will allow a homeowner to sue for regular negligence and damage. The standard under that provision is very, very high. CHAIR BUNDE thanked her for her explanation and noted that a motion was pending. He asked for the roll to be called. SENATORS FRENCH, SEEKINS, STEVENS, DAVIS and BUNDE voted yea and SCS CSHB 9 (L&C) moved out of committee.