By David S. DeRose, Esq.

Homeowners rejoice! Pennsylvania has enacted the “Home Improvement Consumer Protection Act” which will go into effect on July 1, 2009. This act is intended to protect consumers from unscrupulous contractors performing repair, remodeling, renovation or other general improvement work.

The Pennsylvania Attorney General’s Office reports that complaints concerning home repair projects seem to increase each year. Concerns range from contractors who do not actually show up to perform the work to those who perform substandard work or even those who take advantage of elderly homeowners.

For the first time, the law in Pennsylvania requires home improvement contractors earning more than $5,000 per year to register with the Bureau of Consumer Protection in the Office of the Attorney General. This registration includes paying a registration fee of $50 and provides the Attorney General with information that specifically identifies the contractor, including the contractor’s address, the name of the contractor’s business, telephone number, driver’s license number, Social Security number, and other related information. This act applies not only to individuals but partnerships and corporations acting as contractors in this state. The contractor will also have to furnish with its application information concerning any conviction of a criminal offense related to any home improvement transaction, fraud, theft, or any other fraudulent business practice. Proof of liability and personal injury insurance coverage is also required. Once the Bureau of Consumer Protection is satisfied that the applicant has furnished all of the required information, the bureau will then issue the home improvement contractor a registration certificate and number. The contractor will need to re-register every two years.

The new law requires contractors to include the state registration number in all of its business advertising distributed in Pennsylvania and to display that number on its contracts, estimates and all proposals given to property owners in this state. The act also mandates that home improvement contracts will only be valid and enforceable if the contract is in writing, clearly written, and contains an adequate description of the work to be performed with the approximate starting date and completion date being specified. The written contract must be signed not only by the contractor, but also by the owner or the owner’s agent. The law also specifies that the total sales price under the contract must be stated, and there are specific rules relating to the amount of any down payment that will be required from the homeowner.

Further, the law defines home improvement fraud which would subject a contractor to criminal charges to be brought by the Attorney General’s Office or the local District Attorney’s Office. Home improvement fraud is broadly defined to include the making of false or misleading statements to solicit a person into entering into a remodeling agreement; the taking of deposit money from a homeowner and not providing materials as contracted for; making false or deceptive advertisements; and misrepresenting or attempting to conceal the actual identity of the contractor or the contractor’s sales agent.

The Attorney General is intending to establish a toll-free telephone number to assist consumers in obtaining verification information about contractors who have registered. After July 1, 2009, homeowners with home improvement contractual disputes will be able to contact the Attorney General’s Office hotline number and file a complaint. Hopefully, this will serve to limit the harm that has been caused by “fly-by-night” people who label themselves contractors.