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STATE LICENSING REQUIREMENTS IN CONSTRUCTION

17th Annual Construction Law Conference

March 4 & 5, 2004
Dallas, Texas

Robert C. Bass, Jr.

Winstead Sechrest & Minick P.C.
Austin, Texas




Abstract

Almost every state in the United States1 (and the District of Columbia) requires the registration, certification, or licensing of certain “specialty” contractors, such as plumbing and electrical contractors, and a growing majority of states require the registration, certification or licensing of general contractors or builders.

The statewide requirements vary considerably from state to state, with some states (such as Arizona, California, and Florida) requiring competence examinations and other states (such as Iowa and Nebraska) simply requiring registration2 with the payment of a small fee. The majority of states regulating general contractors or builders do not distinguish between contractors for commercial or residential projects; however, a number of states restrict their regulation to home improvement or residential construction contractors and at least two states (Idaho and Indiana) only require the registration or certification of contractors performing public works.

Although design professionals such as engineers and architects have been regulated at the state level in Texas since 1937 (Acts 1937,45th Leg.. p. 816, ch. 401 and p. 1279, ch. 478, respectively), the regulation of contractor entities at the state level has been a relatively recent trend in the United States and in Texas. For many years, most regulation of the construction industry in Texas, if any, occurred at the local level. In the case of plumbers and plumbing contractors, the Texas Legislature enacted a statute in 1911 which required cities having underground sewers to pass ordinances regulating the “tapping of sewers and house draining and plumbing”. This statute also required cities to establish and provide for the examination and licensing of plumbers. See Davis v. Holland, 168 S.W. 11, 12-13 (Tex. Civ. App. - Dallas 1914, error ref’d); Trewitt v. City of Dallas, 242 S.W. 1073, 1078-79 (Tex. Civ. App. - Dallas 1922, no writ). Even without a statutory mandate, cities began to regulate certain construction activities under their police powers. See e.g., Modern Order of Praetorians v. Nelson, 162 S.W. 17, 19 (Tex. Civ. App. - Dallas 1914, dismissed) which upheld a Dallas City ordinance requiring minimum training for elevator operators in buildings open to the public.certification, or licensing of certain “specialty” contractors, such as plumbing and electrical contractors, and a growing majority of states require the registration, certification or licensing of general contractors or builders.

The statewide requirements vary considerably from state to state, with some states (such as Arizona, California, and Florida) requiring competence examinations and other states (such as Iowa and Nebraska) simply requiring registration2 with the payment of a small fee. The majority of states regulating general contractors or builders do not distinguish between contractors for commercial or residential projects; however, a number of states restrict their regulation to home improvement or residential construction contractors and at least two states (Idaho and Indiana) only require the registration or certification of contractors performing public works.

Although design professionals such as engineers and architects have been regulated at the state level in Texas since 1937 (Acts 1937,45th Leg.. p. 816, ch. 401 and p. 1279, ch. 478, respectively), the regulation of contractor entities at the state level has been a relatively recent trend in the United States and in Texas. For many years, most regulation of the construction industry in Texas, if any, occurred at the local level. In the case of plumbers and plumbing contractors, the Texas Legislature enacted a statute in 1911 which required cities having underground sewers to pass ordinances regulating the “tapping of sewers and house draining and plumbing”. This statute also required cities to establish and provide for the examination and licensing of plumbers. See Davis v. Holland, 168 S.W. 11, 12-13 (Tex. Civ. App. - Dallas 1914, error ref’d); Trewitt v. City of Dallas, 242 S.W. 1073, 1078-79 (Tex. Civ. App. - Dallas 1922, no writ). Even without a statutory mandate, cities began to regulate certain construction activities under their police powers. See e.g., Modern Order of Praetorians v. Nelson, 162 S.W. 17, 19 (Tex. Civ. App. - Dallas 1914, dismissed) which upheld a Dallas City ordinance requiring minimum training for elevator operators in buildings open to the public.

One of the earliest “statewide” licensing statutes for a specialty contractor in Texas was the Plumbing License Law of 1947 (formerly Art. 6243-101, Vernon) which created the Texas State Board of Plumbing Examiners and vested in that state agency the sole authority to examine and regulate plumbers and plumbing contractors in Texas. See Attorney General Opinion V-549 (1948). However, it took a number of years before the Legislature decided to start licensing or regulating other large specialty contractor groups. For example, it was not until 1983 that the Texas Legislature created a statewide license for “air conditioning and refrigeration” contractors (formerly Art. 8861, Vernon). And, it was not until 2003 that the Texas Legislature finally enacted legislation that provides for the licensing and regulation of electricians and electrical contractors on a statewide basis. In addition to these major specialty contractor groups, the Legislature has provided for the licensing or registration of several other specialty contractor entities that will be discussed below.

To date, the Texas Legislature has chosen not to regulate general commercial contracting on a statewide basis. However, with the passage of the Texas Residential Construction Commission Act (HB 730) in 2003, Texas joined over 30 states and the District of Columbia which provide some measure of regulation of residential builders and remodeling contractors on a statewide basis. This paper will briefly discuss the various statewide licensing or registration statutes governing specialty contractors and residential builders and remodeling contractors in Texas. A table of all the regulatory statutes is attached at the end of the paper.




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