[T]he Vermont Senate passed a consumer protection bill on Friday that includes new measures to protect homeowners from home improvement fraud.
The Senate passed the bill, S.136, in a voice vote. It now heads to the House, where the House Commerce Committee will take testimony on additional consumer protection provisions under consideration for the bill.
A major provision of S.136 would require contracts for residential home improvement valued at more than $10,000. The contracts clearly state either a maximum price for all work and materials or that there is no maximum price for time and materials.
The contract would have to include a specific warranty saying that the work “is free from faulty materials and is performed in a skillful manner according to the standards of the building code applicable for this location or to a higher standard.”
All change orders on the work would need to be memorialized in writing within three days of the order. Additionally, the down payment on the work could be no more than one-third of the maximum price of the contract, or the price of materials, whichever is greater.
The legislation requires the Vermont Attorney General’s office to create a sample contract that would show how the contract should be written. The attorney general’s office maintains a registry of bad actors in the home improvement field.
Sen. Kevin Mullin, R-Rutland, said the idea for the home improvement fraud protection came from constituents “who have literally paid good money and not have work performed or performed in a very bad manner.”
Mullin described projects where a consumer complains that the plumber installs a shower or a septic tank backwards. “We’ve heard stories of roofers who get your deposit and you eventually don’t see, and you harass them and harass them and eventually get some shingles,” he said.
Chris Curtis, the chief of the public protection division at the Attorney General’s Office, said the office has received at least 216 complaints in the past two years totaling more than $1 million.
“It’s a serious problem,” he said. “It’s a problem that has got to be addressed, and we’re grateful that the Legislature is giving this provision of the bill a free and fair hearing and advancing the bill.”
Home improvement fraud has been on the minds of the Senate Economic Development, Housing, and General Affairs Committee for the past few years, according to Mullin, but the language was delayed when there weren’t enough votes in favor of regulating home improvement fraud.
Curtis said his office sought to set the threshold for home improvement contracts at $5,000. Any project under that amount can be litigated in small claims court and projects above that amount tend to get complex and would benefit from a written contract.
“We’ll make that case in the House, but we’re very glad to see the Senate act on this bill and move the bill forward,” Curtis said.
Sen. Michael Sirotkin, D-Chittenden, said it would be useful to lower the threshold for a written contract because the majority of complaints the Attorney General’s Office received were for projects under $10,000.
“It’s not as strong of a bill as I personally would have liked to have seen, and not as strong of a bill as most of the states around us have passed, but hopefully it can be improved upon as we go forward,” Sirotkin said.
Mullin and Curtis expect the House Commerce and Economic Development Committee to add a number of provisions to the consumer protection bill before sending it back over to the Senate.
Curtis said his office will be seeking action related to fair debt collection practices and data brokers, which collect data about consumers and sell it to third parties.
