Editorial
   Texas Residential Construction Commission (TRCC) Report Card
       Comptroller gives Builder-Protection Agency Failing Grades 

By Janet Ahmad,
National President of HomeOwners for Better Building
2/14/2006

It’s no coincidence that home builders have enjoyed record-breaking profits at the same time the state has sanctioned poor building practices and limited lia bility of builders who build defective houses.  However, for builders who continually fool homeowners and embarrass lawmakers, it may prove to be a different story after State Representative Todd Smith called on the State Comptroller to report on some important questions he had about the Texas Residential Construction Commission (TRCC). 

While Texas is experiencing the highest number of foreclosures in history and predatory lending practices are flourishing, houses are selling like iPods, and new homes are falling apart due to construction defects. Unlike the defective homes, consumers can simply return their defective iPods for repair, replacement or refund.  Unfortunately families unknowingly invest in homes with weak, non-enforceable limited warranties that are little more than builder disclaimers.  If you think government protects buyers when purchasing the biggest investment most of us will ever make – think again. 

To drive a car, one must show proof of knowledge and financial responsibility before obtaining a drivers license.  In contrast, to build and sell new homes in Texas there is no requirement to show proof of professional building skills, knowledge of current codes, or to show any proof of financial responsibility, or even proof of a current bank account, not to mention a license.

In early 2003 the building industry contrived convincing tails of woe, along with millions in PAC contributions that persuaded some Texas lawmakers to help create the unprecedented experimental state agency of TRCC.  Our elected officials not only complied with their wishes but relied on the wisdom of the industry to write the bill and trusted them to run the unique state-funded agency that mandates how homebuyers must pay a fee to complain about their builder, while simultaneously allowing shoddy construction standards to be written by the building industry.

In the recently completed State Comptroller’s report there is compelling evidence that Texas lawmakers have made a mistake and been duped into going along with the building industry’s long term plan to thwart homeowners that seek a well built home.  Unquestionably, the report gives failing grades to TRCC, and the revelations are reprehensible.  

At a news conference, State Comptroller Carole Keeton Strayhorn, in typical Strayhorn fashion, candidly presented the results of the agency’s five-month investigation.  .  

In the report to Representative Smith, Strayhorn described TRCC as a builder-protection agency and one that “imposes costly and bureaucratic roadblocks for homeowners left out in the cold by shabby construction and a commission dominated by builders.”

Strayhorn went on to say that in a survey conducted by her office 86 percent of homeowners who responded stated builders failed to fix construction defects after going through the TRCC, State Sponsored Inspection and Dispute Resolution process.

The state agency did not require builders to show any “proof of experience, education or financial solvency.”  Further, despite the requirement for criminal background checks, “…a currently registered builder was convicted of burglary of a vehicle, burglary of a building and attempted homicide.  Another builder was convicted of a sex crime and registered as a sex offender just months before he was allowed to register as a homebuilder.”

Strayhorn then recommended the builder-protection agency be blasted off the “bureaucratic books."

The report supports what homeowners and consumer groups have said all along about the inequities when families purchase defective new homes.  The builders Limited Warranty gives a false sense of security and the state mandate that created TRCC imposes bureaucratic hardships on buyers and wasted time, plus millions in taxpayer’s dollars on a state agency for what they describe as unnecessary.

 

The fact is, TRCC is an industry scheme to ‘control’ the consumer through dilatory tactics, exorbitant fees, ridiculously lax performance standards and a warranty with more ‘gotchas’ than a ‘house of mirrors’. 

The comptroller’s report is a wake-up call to Texas lawmakers and families thinking of buying new homes. 

We can either perform extensive life-saving procedures on this experimental TRCC multi-million-dollar bureaucratic fiasco, or get on with the business of consumer protection by enacting a simple, logical solution like a Home Lemon Law.  At the very least, a Home Lemon Law would give an incentive to builders to construct a home right the first time, or buy it back when they fail to make repairs, avoiding a huge bureaucratic state agency and costly legal action that TRCC scandalously promotes.

 

We echo the sentiments of Strayhorn; “It isn’t the role of government to throw up bureaucratic barriers to protect unethical or inept builders from their customers… Caveat emptor—let the buyer beware—is the motto of the unscrupulous.  It should not be the hallmark of state policy.”

At the end of the day, shouldn’t families expect basic state consumer protections when purchasing something as fundamental as decent housing that historically should last for generations?