Report Title:

Contractors' Exemption; Licensing

Description:

Raises the contractor's licensing exemption that allows limited work by non-licensed contractors from $1,000 to $2,500 per job.

HOUSE OF REPRESENTATIVES

H.B. NO.

2750

TWENTY-SECOND LEGISLATURE, 2004

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO CONTRACTORS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature finds that the State is on the verge of a building boom that has been compared to the enormous construction growth of the 1960s and 1970s. Building trade unions have increased their efforts to ensure that the supply of skilled tradespersons will eventually meet this inevitable demand. But the demand appears to be preceding the present supply of tradespersons.

Presently, general contractors are taking advantage of the construction boom, and in so doing are declining smaller jobs that are less lucrative. Homeowners, however, who have smaller jobs valued at a few thousand dollars are left stranded, unable to find someone to repair their homes. Homeowners cannot find an available contractor and cannot hire a handyman who is restricted by law from accepting jobs valued at over $1,000.

The purpose of this Act is to raise the restriction on the value of repair jobs that may be accepted by handymen from $1,000 to $2,500, to assist homeowners with smaller repair jobs.

SECTION 2. Section 444-2, Hawaii Revised Statutes, is amended to read as follows:

"§444-2 Exemptions. This chapter shall not apply to:

(1) Officers and employees of the United States, the State, or any county while in the performance of their governmental duties;

(2) Any person acting as a receiver, trustee in bankruptcy, personal representative, or any other person acting under any order or authorization of any court;

(3) A person who sells or installs any finished products, materials, or articles of merchandise that are not actually fabricated into and do not become a permanent fixed part of the structure, or to the construction, alteration, improvement, or repair of personal property;

(4) Any project or operation for which the aggregate contract price for labor, materials, taxes, and all other items is not more than [$1,000.] $2,500. This exemption shall not apply in any case where a building permit is required regardless of the aggregate contract price, nor where the undertaking is only a part of a larger or major project or operation, whether undertaken by the same or a different contractor or in which a division of the project or operation is made in contracts of amounts not more than [$1,000] $2,500 for the purpose of evading this chapter or otherwise;

(5) A registered architect or professional engineer acting solely in the person's professional capacity;

(6) Any person who engages in the activities regulated in this chapter as an employee with wages as the person's sole compensation;

(7) Owners or lessees of property who build or improve residential, farm, industrial, or commercial buildings or structures on property for their own use, or for use by their grandparents, parents, siblings, or children and who do not offer the buildings or structures for sale or lease; provided that this exemption shall not apply to electrical or plumbing work that must be performed only by persons or entities licensed under this chapter, or to the owner or lessee of the property if the owner or lessee is licensed under chapter 448E. In all actions brought under this paragraph, proof of the sale or lease, or offering for sale or lease, of the structure not more than one year after completion is prima facie evidence that the construction or improvement of the structure was undertaken for the purpose of sale or lease; provided that this provision shall not apply to residential properties sold or leased to employees of the owner or lessee; provided further that in order to qualify for this exemption the owner or lessee must register for the exemptions as provided in section 444-9.1. Any owner or lessee of property found to have violated this paragraph shall not be permitted to engage in any activities pursuant to this paragraph or to register under section 444-9.1 for a period of three years. There is a presumption that an owner or lessee has violated this section, when the owner or lessee obtains an exemption from the licensing requirements of section 444-9 more than once in two years;

(8) Any joint venture if all members thereof hold licenses issued under this chapter;

(9) Any project or operation where it is determined by the board that less than ten persons are qualified to perform the work in question and that the work does not pose a potential danger to public health, safety, and welfare; or

(10) Any public works project that requires additional qualifications beyond those established by the licensing law and which is deemed necessary and in the public interest by the contracting agency."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________