Updated at 7:38 p.m.
Gov. Phil Scott has vetoed a bill to establish a statewide registry of residential building contractors, arguing H.157 is unnecessary and would put the state’s smaller operators at a disadvantage.
“This bill favors larger and more established businesses at the expense of small, entry-level businesses by imposing, by law, specific contract and insurance requirements that many of the smaller businesses will not be able to meet,” Scott wrote in his veto letter to lawmakers.
The Republican governor’s announcement landed in reporters’ inboxes just as champions of the bill were wrapping up a press conference urging him to sign the bill. The event was organized by Senate President Pro Tempore Becca Balint, D-Windham, and speakers included Attorney General TJ Donovan, Secretary of State Jim Condos, pro-registry contractors and homeowners who have been victims of fraud.
Contractors disappearing with deposits, performing shoddy work or leaving jobs unfinished is a top source of complaints for the attorney general’s office, Donovan said, and Vermonters reported an estimated $2 million in losses in 2020 and 2021.
“This is real money for folks. And when you talk about creating just this light-touch registry, it’s very simple. You’re just giving Vermonters information, so they can make an informed choice,” Donovan said.
H.157 would require contractors performing jobs worth $3,500 or more to register with the Secretary of State’s Office of Professional Regulation. The measure would also require registered businesses to carry minimum liability insurance of $300,000 per claim, and to draw up formal contracts for projects with property owners.
Balint left the press conference before Scott’s veto was announced. But in a statement released shortly after, she slammed the governor for his decision.
“When a family invests thousands of hard-earned dollars in maintaining their home, they should have protection and reassurance that they won’t be fleeced,” she wrote. “The small businesses we’re hearing from are telling us they’re being undercut by unscrupulous, unskilled fraudsters. The Governor should be standing with Vermonters who’ve been ripped off.”
Proponents of the measure cast the bill as an important consumer protection measure. But H.157 also has support from many in the industry, where some contractors say a little regulation would bring professionalization to the sector and improve public trust.
The Vermont Home Builders and Remodelers Association has been working on and off for nearly 15 years to bring a registry to fruition. Jim Bradley, a past president of the group, said during Thursday’s press conference that the state is “seen as the Wild West of New England when it comes to the building industry.”
“We are one of only a few states in the nation without some type of contract or registry or licensing requirement,” Bradley said.
Chris West, a fellow contractor and, along with Bradley, the co-host of the WDEV radio show “House Calls Vermont,” said a registry would allow the state to get crucial information out to builders. Many smaller outfits missed out on Covid-19 relief aid, he said, because the state had no centralized way to get in touch.
West said the requirements tacked on to the registry would also help honest contractors, who don’t want to compete with unscrupulous actors that can get away with bypassing the rules.
“A lot of our builders are upset because they get undercut and underbid by builders who just don’t know what they’re doing and underperform as well as over-promise,” West said.
In his missive to lawmakers, Scott said there are already plenty of ways to hold bad actors accountable. The attorney general’s office maintains the Home Improvement Fraud Registry, the governor said, and current law also allows the state or county prosecutors to pursue criminal or civil charges against fraudulent builders.
But advocates of the bill said it would prevent bad behavior before it rises to the level of a crime. The existing fraud registry covers only individuals who have been convicted of criminal fraud, said Charity Clark, Donovan’s chief of staff. And the registry contemplated in the bill would create a more coordinated system for responding to complaints, she argued.
“Our current legal framework places the burden on consumers to call their local police or state’s attorneys in the hopes of possible criminal action, or a private attorney for a possible civil action, or the Consumer Assistance Program for mediation,” Clark said. “This is confusing and inefficient.”
Scott also argued that Vermonters already have ways of finding contractors and doing their due diligence.
“One can find directories maintained by trades associations, as well as commercial listings, social media, consumer sites, references, and, of course, word of mouth,” he wrote.
But Tina Desmarais, a Plainfield resident who attended Thursday’s press event, said she checked references and tried to be responsible in 2019 when she hired a St. Johnsbury man, who absconded with a $10,000 deposit after agreeing to fix her roof. Despite his conviction in 2020, Desmarais said she never got back a dime.
“There is no teeth in the law. There is no no way for those of us who are victimized to get satisfaction and to stop the madness,” she said.
It’s unclear if lawmakers will attempt to override the governor’s veto. Balint said the Senate was prepared to do so, but the House, where Democrats and Progressives no longer enjoy a veto-proof supermajority, would need to take action first.
“We have yet to meet with our team and discuss next steps but will do in the coming days,” said Conor Kennedy, chief of staff to House Speaker Jill Krowinski, D-Burlington.
