Guest Blog: It’s time to let the sunset on the Builders Commission

This is a guest blog and an excellent read from a fellow TPA member. John R. Cobarruvias has been an advocate for new homeowner rights and is a member of Homeowners Against Deficient Dwellings. He has testified against the TRCC and has provided research on the Commission and the rules and procedures.

In 2003 the Texas Legislature passed the Texas Residential
Construction Commission Act, creating a Commission to regulate the
home building industry and provide consumer protection for new
homebuyers. Six years later the Texas Comptrollers Office and the
Texas Sunset Commission have called for the abolishment of the TRCC
(trick). As the reports stated, the Commission is nothing more than a
“builder protection agency” with “fundamental flaws that do more harm
than good”. The fate of this ill-conceived Commission is currently in
the hands of the Texas Senate. They should stand with the consumers of
this state and let the sunset on this fatally flawed Commission.

In response to the concerns of the Sunset Commission, House Bill 2295
by Representative McClendon (D-San Antonio) has been filed. According
to the rules of the Sunset Commission, if this “sunset” bill is not
signed into law, the TRCC will be abolished. The bill has passed the
House and is currently lingering in the Senate with time running out
in the legislative session.

The facts concerning this Commission, which supposedly was created to
help homeowners with construction defects, are undeniable and
unbelievable. The Senior Vice President and General Counsel of Bob
Perry Homes wrote the bill that created the TRCC. Governor Perry later
appointed him to the Commission. The State Legislator who sponsored
the TRCC bill owns a lumber company and sells to the home building
industry. He is a member of the Texas Association of Builders (TAB)
and received an award after passing the bill. The National Association
of Home Builders also named him “Legislator of the Year”.

Since its creation, the board has been stacked with builder friendly
Commissioners. The Arbitration Task Force, charged with researching
the abuse of mandatory binding arbitration in new home contracts, was
stacked with home builders and members of the American Arbitration
Association (AAA). The Commission, heavily in favor of the home
building industry, established a statewide standard for new home
warranties that provides one single year of protection, while
repealing the implied warranty of good workmanship granted to
homeowners in the sixties.

In 2006 the Texas Comptroller’s Office conducted a detailed
investigation of the TRCC prompting the Comptroller to state "...if it
was up to me personally, I would blast this TRCC builder-protection
agency off the bureaucratic books". The report by the Sunset
Commission issued in 2008 had a key recommendation of “Abolish the
Texas Residential Construction Commission and repeal the Texas
Residential Construction Commission Act.” Both reports were very
clear, the $10 million/year TRCC is not providing a useful service to
the consumer and deserves to be abolished.

HB2295 continues to deceive. The bill calls for licensing of home
builders, but exempts over 28,000 builders currently registered with
the TRCC. The licensing oversight will be controlled by the TRCC an
agency with 6 years of failure, instead of by the Texas Department of
Licensing and Regulation with 100 years of outstanding service and
experience in oversight. And the requirements for licensing are
nothing more than paying a fee, taking 8 hours of training, and
passing a test administered by the inexperienced TRCC.

The mandatory State Sponsored Inspection and Resolution Process
(SIRP), a process to help mediate complaints, continues to be a
convoluted, complicated, legal nightmare that requires legal
assistance to navigate. The bill offers an optional, extremely
expensive mediation process chalk full of legal loopholes that will do
more harm than good for the consumer. The bill also reduces the time
required to complete the SIRP, but does nothing to reduce its
overwhelming complexity and legal ramifications.

In 2003 testimony from the home building industry claimed the TRCC
would provide much needed consumer protection for new homeowners with
construction defects. Instead it has been an expensive failure causing
financial ruin to many homeowners and allowing the industry to run
wild with no fear of being held accountable.

The facts are clear. It is time to let the sunset on this
bureaucratic, expensive, nightmare called the TRCC.
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