IT DOESN’T HAVE TO BE THIS WAY - WE PROVED IT!

HOT DEFEATS BUILDER LOBBYISTS - TRCC ABOLISHED

HOT gave Texas homeowners a voice in the 2009 legislative session. We scored a stunning victory against the $35 Billion Texas Home Building industry lobbyists by convincing lawmakers to abolish an abusive agency that the builders created - the Texas Residential Construction Commission (see TRCC Eulogy). We also worked with the Texas Society of Professional Engineers to pass a law requiring engineered foundations for homes built on expansive soil.

You see, we the people can still win when given a voice, proper insight, and a winning strategy. That’s HOT: giving homeowners an effective voice to balance the power of special interests.

TRCC is in a 1-year shutdown process

Texas lawmakers, by abolishing the TRCC, restored the implied warranty of habitability and removed a costly and time consuming state inspection process (SIRP) that stood between homeowners and dispute resolution. 

The State's sunset provisions allow for a 1-year shutdown process before all assets must be returned, offices vacated, data archived, and employees dismissed or reassigned. At its 6/11/09 meeting, the TRCC announced a general timeline and action plan related to the implementation of the sunset. Here's their FAQ and our summary:

• HOT Advice: How homeowners can protect themselves without the TRCC.  
• HOT Advice: How builders can protect themselves without the TRCC. 
• The commission no longer accepts home & builder registrations or inspection requests. 
• The commission no longer shares builder registration information. This is good, because registration can be confused with licensing and give consumers a false sense of security. 
• Existing inspection requests will be handled as quickly as possible following commission rules, and ombudsmen will process post-inspection actions through 8/31/10. 
• The commission no longer accepts contractor complaints, so direct your complaints to your local District Attorney, the Texas Attorney General (www.oag.texas.state.us) or the Federal Trade Commission (www.ftc.gov). 
• Homeowners who can't get contractors to fix warranty items can now opt-out of the SIRP inspection process and pursue arbitration or a civil suit. 
• Without the TRCC, we revert to RCLA (see reform plans, below) and DTPA. 

HOT plans for next session

To build upon our past success we need your help now, because legislative battles are won or lost based on work done between sessions. Our aggressive agenda includes regulatory oversight of homebuilding via a Homeowner's Bill of Rights and additional reforms that will benefit all Texas homeowners. Others in the value chain will also benefit, including reputable builders, inspectors, realtors, insurance companies, mortgage companies, banks, neighborhoods, and taxing municipalities.

• Home Insurance rates -- Texans pay the 2nd highest insurance rates in the nation because State regulations favor insurance companies at the expense of homeowners. Are you proud of that? Let’s fix it. 
  
  
• Property Taxes -- Texas isn't such a "low tax state" after all. Voter approval of propositions on the 11/3/09 ballot will help, but Texans still pay the 2nd highest property taxes in the nation - taxes that can easily exceed $5,000 per year and are almost 90% higher than in neighboring states or as a national percentage of income. 
  
  
• Home Owner Associations -- Texas gives HOAs more rule making authority than counties, meaning they can raise fees, charge fines, and even foreclose on properties at will and with no oversight - especially when controlled by the developer. 
  
  
• Regulatory Oversight through Licensing -- Contractor licensing can restore consumer trust in the homebuilding industry and increase sales and economic development in Texas. It can also address the foreclosure problems that put entire neighborhoods in a downward spiral and lower the home values for everyone and threaten the property taxes that fund city services. But Texas is the only growth state with no laws to regulate builders or hold them accountable. That means you have less protection when buying a new home than buying a used one (or even a used car). Becoming a builder in other states is like becoming a driver here: pass a test and get a license to prove competency and buy insurance to prove accountability. If you break the law, you can get a ticket or lose your driver's license, and if you drive without a license or insurance you could go to jail. 
  
  
• Building Codes -- They help protect our health, safety, welfare and environment, and they evolve with new Energy Star, green and sustainable technologies. The latest International Residential Code includes a requirement for automated fire sprinklers, but the Texas Association of Builders objected and got a law passed in 2009 to prohibit cities from adopting the new standards. That's irresponsible and puts lives at risk. The law must be repealed, because an extreme example of such actions is Haiti, where government corruption and the lack of building codes, zoning and good contractors led to mass devastation in the Jan/09 earthquake.
  
  
• Reform RCLA -- The Texas Residential Construction Liability Act (RCLA) remains intact after the TRCC was abolished. This paper by Cheryl Turner explains the complex history of RCLA and how it insulates contractors & warranty companies from the consumer protections of DTPA, the Deceptive Trade Practices Act. RCLA's builder protections now apply even if they "don't make an offer to repair, fail to make a reasonable offer, or fail to perform the agreed-upon repairs in a good and workmanlike manner." Builders have used RCLA to prevent class actions and block access to consequential or punitive damages and attorney fees. 
  
  
• Arbitration -- Builders and tort reformers have use pre-dispute binding arbitration clauses in sales contracts to steal your Constitutional Rights to a jury trial and equal justice under law. To restore fairness, we propose a ban on such contracts for Texas homesteads and urge Congress to pass the Arbitration Fairness Act. 
  
  
• Eminent Domain -- Property taken by eminent domain is usually reserved for public utilities, highways, and railroads and then only with just compensation; but many Texans have lost their homes to toll roads, shopping malls, sports stadium, and other projects that generate more tax revenue. The Legislature is also compliant  in a statewide land grab that forces many homeowners out of their homes through unaffordable property taxes.  
  
  
• Contamination -- The Brownfields Law was passed in the early days of the George W. Bush administration to encourage development of contaminated land, but it shields builders from liability and a duty to disclose any health risks. It also gives the President unprecedented powers with no judicial review. Because lives are at stake, this law must be repealed. 
  
  
• Artificial Stimulus -- Allow the Homebuyer Tax Credit to end in June. The $8,000 tax credit on buying new homes and $6,500 tax credit on existing homes was sponsored by homebuilders, realtors and mortgage companies "to help the economy," but it help those special interests at the expense of taxpayers. When the bill could not stand on its own, it was attached to a "must pass" unemployment bill. Why would a "homeowners" group oppose a bill that provides "free money"? 

We're your voice

Builders have an advantage when it comes to influencing public policy and judice, thanks to their powerful lobbyists and large campaign contributions. Houston homebuilder Bob Perry, for example, gave “more than $21 million since 2006 to political candidates and judges," including all but six Texas legislators and all nine justices of the Texas Supreme Court. The Texas Supreme Court then overturned an arbitration award against Perry that favored homeowners Bob and Jane Cull and was confirmed by lower appellate courts.

With your support, HOT gives homeowners an effective voice to help balance the power of special interests. We propose legislation and testify on your behalf, which means we need to hear your story. (Please post to our blog.) HOT can also help you improve the effectiveness of your personal testimony when you want to give it.

We're good at what we do

While consumer activist organizations complain about issues and "rally the troops" to get media attention, HOT has a different approach. We apply our unique legal, legislative, analytical, engineering, and marketing strengths to the task of understanding the root cause of problems, crafting alternative legislative solutions, and selling them through the legislative process. It's what allowed us to accomplish in our first year what other Texas consumer groups had been unable to do over 20 years.

As an example of the Systems thinking involved in our analysis, here are some recent resources we've used.

• The Corporation - Why would so many big builders & finance companies behave so badly.
• FOOD, Inc. - Food processors versus consumers is like Builders versus homeowners. 
• Who's to Blame for the Financial Crisis? - Who were the culprits? TIME Magazine names 25. 
• Texas Homebuilding and the Global Collapse - Was it good intentions or something sinister? 
• CRUEL HOPE - Abusive Practices of Homebuilders and Their Mortgages Subsidiaries in CA [& TX]