Home Lemon Law Amendment Debated in Texas House

By: JANET AHMAD
Monday, June 4, 2007

HomeOwners for Better Building, a national consumer group and its members from across the state watched from the house gallery as well as on live video stream, eager to see lawmaker'ss restrain the unregulated Texas Homebuilding Industry.

In an unprecedented, history-making event State Representative Senfronia Thompson, D-Houston, introduced a Home Lemon Law Amendment sparking a spirited debate on the Texas House floor, in which legislators defended Texas homeowners who have been sold defective homes by shoddy builders.

The amendment was tabled by a vote of 83 to 60. However, when it was over 60 lawmakers, including 10 Republicans, had voted in support of a Home Lemon Law, the first ever to be considered or debated by any State Legislature in the nation.

As the house was considering a Homebuilder's Reform Bill,'s HB 1038, by Rep. Allen Ritter, D-Nederland to reform the highly criticized Texas Residential Construction Commission (TRCC), Rep. Thompson introduced her Lemon Law amendment that would have required builders to buy back houses with defects, which create a safety hazard or reduce the home'ss value 5 percent or more if the defect cannot be fixed.

Rep. David Swinford, R-Dumas, chairman of the House State Affairs Committee, responded by claiming the lemon law amendment would add to the cost of everybody'ss house.

With that, Rep. Thompson shot back: I'sm not trying to protect unscrupulous builders. Are you saying that protecting the safety, health and welfare of a person when a homebuilder builds a house, and he does it in a manner that creates a defect or a safety problem, that it adds to the cost of building a home?

Members, if you want to protect unscrupulous builders, you need to vote with Mr. Ritter. But, if you want to be with the people, who are paying their hard-earned money to make the greatest investment that they are ever going to make in their life, and that'ss a home, then you need to vote no on the motion that is on the table, shouted Rep. Thompson.

In 2003 the building industry lobbied lawmakers for passage of controversial legislation that created the TRCC, which is commonly referred to as a builder protection agency that has no authority to force builders to correct construction defects.

In January 2006, then-Texas State Comptroller Carole Keeton Stryahorn issued a scathing report on TRCC that described it as an agency that imposes costly and bureaucratic roadblocks for homeowners left out in the cold by shabby construction and a commission dominated by builders.

Rep. Ritter'ss bill now moves on to the Senate with a number of amendments that give some enforcement power to TRCC but still makes it mandatory for homeowners to go through a burdensome and time-consuming process.

While HB 1038 is one small step in the right direction, homeowners will not be fully protected until the TRCC is voluntary, free, and effectively enforced, said Janet Ahmad, national president of HomeOwners for Better Building.

Some of the amendments will certainly improve the agency, but there is still a lot of improvement needed to protect homeowners, continued Ahmad. What does it say for the industry if knowledge and financial responsibility are optional for Texas homebuilders?

Rep. Craig Eiland, D-Galveston - although unsuccessful - tried to make the TRCC process and arbitration voluntary for homeowners rather than mandatory and objected to the fact that the commission cannot enforce penalties until a builder exhausts all of his appeals through the courts. A builder commits fraud (and) the TRCC agrees the builder stole money from a homeowner, Eiland said, but the commission can'st do anything until the builder exhausts all legal appeals.

Any legislation must give builders an incentive to build homes right the first time or to fix them should they happen to make a mistake. A home lemon law does that, it is a simple way to hold builders accountable without bureaucratic roadblocks and years of expensive legal battles, concluded Ahmad.

See video: Representative Thompson'ss Lemon Law Amendment debate
http://www.house.state.tx.us/media/chamber/80.htm
Click on 04/24/07, 1:15 p.m. - 9:06 p.m. Start at 4:35 ending at 4:49:42