highlights, reader comments, and [bracketed HOT comments] added

Imagine hundreds of executives from BP, Shell and Exxon Mobil rallying on the steps of the Capitol in Washington to save the Environmental Protection Agency.

That may be hard to picture, but recently in Texas, 1,000 homebuilders rallied at the state Capitol in an effort to save the agency that theoretically regulates them. Texas homebuilders are big fans of the job the Texas Residential Construction Commission has done since its inception five years ago. But after a backlash from homebuyers, who say the process is stacked in the builders' favor, state lawmakers are now considering whether to abolish it.

[HOT: We dispute both highlighted claims, which seem to have come from a Texas Association of Builders press release. We attended the TAB rally and spoke with several builders at random. All except one criticized the TRCC and supported our proposals for homebuilder & remodeler LICENSING. They shared concerns about competing with unscrupulous builders who damage respect for their profession. The one builder who opposed licensing was from the builders' association in Dallas. He echo'ed TAB's party line but had no good arguments against replacing the TRCC with licensing. What this tells us is that not all Texas homebuilders are fans - far from it - and the association seems to represent the BIG builders more than the small ones. TAB proudly says the top 150 builders build 85% of Texas homes. That's just 1.25% of the 12,000+ TAB members and 0.5% of the 30,000+ active TRCC registered builders. Based on photos we took, we estimate builder attendance at just less than 500, not 1,000.]

Out of 181 legislators, there are only six who don't take money from the Texas Association of Builders. So when the homebuilders come to Austin to lobby, the most powerful politicians in the state pay their respects. [Wow!]

After a welcome message from the governor, the rallying homebuilders fanned out to the offices of every legislator, bearing small gifts and a message: Save the Texas Residential Construction Commission. [HOT: Our February Newsletter includes a video of Governor Rick Perry's speech and photos from the rally.]

"We're happy, you bet," says Ron Connally, a homebuilder and developer out of Amarillo who is also president of the Texas Association of Builders. "Court actions are way, way down because TRCC has taken care of a lot of those problems."

Process Can Be Costly and Prolonged

The TRCC was written into existence by a lawyer for Houston homebuilder Bob Perry, the most powerful and politically connected homebuilder in Texas. Perry's lawyer was then named the new housing agency's first commissioner by the Texas governor, who has taken hundreds of thousands of dollars in campaign contributions from the homebuilder.

Connally says when the GOP gained control of both houses of the Texas Legislature at the beginning of the decade, the homebuilders moved quickly.

"We were proactive," he says. "We didn't wait for the Legislature to bring some bill that would try to control or regulate the builders - we worked hand in hand with them." 

The TRCC was designed to protect new homebuilders from frivolous lawsuits. Its mission is to provide an alternative state administrative process that resolves new homebuyer complaints before they go to arbitration. But two independent state reviews of the TRCC reported the commission routinely fails: For example, only 12 percent of homebuyer complaints were resolved. And half of the time, homebuyers' grievances were rejected outright by the TRCC's inspectors. The process takes up to 20 months and can cost the homebuyer thousands of dollars.

[HOT: The effectiveness of our consumer advocacy and testimony from angry homeowners are having a profound effect on news coverage and reactions from the builder community. Bob Perry is known to be intensely media-shy, yet he came to the Capitol to meet with lawmakers just one day after the two damning NPR reports. We would have loved to have been a "fly on the wall" during those meetings.]

"Two state reports on TRCC have concluded that it is beholden to the building industry," says Tom Archer, the president of Homeowners of Texas, a nonprofit dedicated to residential construction reform.

Archer says that of the nine TRCC commissioners who review homeowner complaints, the homebuilders regularly get seven votes.

"In actuality, I think the number most would say would be eight out of nine," he says.

Staying Out Of Court

Archer says an even bigger problem with the TRCC is that the agency has no ability to discipline bad or even criminal builders. In Texas, there is no state licensing of builders, and builders of new homes are not required by law to disclose known defects, unlike sellers of existing homes.

Even if a builder is repeatedly negligent and deceptive, there's little the state can do about it. In five years of existence, the Texas Residential Construction Commission has revoked just one builder's registration. Archer says when it comes to protecting buyers of new homes, the Lone Star State is not exactly leading the pack.

"I would say we're dead last," he says. "I don't believe there's any state in the country where the homeowner is up against more obstacles and more impossible tasks in terms of getting relief than they face here in Texas."

The TRCC process is designed to keep new homebuyers out of court, where a state judge would hear the facts and rule. That's the way it used to be in Texas. But the executive director of the TRCC, Duane Waddill, believes his agency has been a big improvement over unreliable state judges.

"It ultimately came down to a judge hearing dueling experts and that judge had to make the decision, so it was very arbitrary and was left in the hands of that adjudicator," Waddill says. "What we provide through our inspection process is a neutral professional."

Waddill agrees that the TRCC needs to tweak how it handles homebuyer complaints. But he says the agency does a good job of serving the interests of both builders and new homebuyers.

"We want to do everything we can to make sure that people want to use our process," he says. "What we've seen in every review of ours has been that the agency is run well."

[HOT: So why has every indepent report and ALL homeowner testimony been so critical of the agency? What motives does Waddill have for making such claims? Is he just trying to save his job as Executive Director? After a Texas Computroller survey published damning write-in homeowner comments, the builders had laws enacted to block future access to home buyer data - specifically to prevent future indepent surveys.]

Complaints From Homebuyers

When the TRCC was first proposed in 2003, most Republicans in the Legislature supported it in the name of tort reform. But a steady stream of complaints has come out of the growing suburbs of Houston, San Antonio, Austin and Dallas. GOP legislators have been getting an earful from young, conservative, first-time homebuyers.

"I have a builder in my community that currently has 37 felony indictments against him - you know, over basic TRCC-type of issues," says state Rep. Dan Gattis, who represents the fastest-growing county in the state, just north of Austin.

[HOT: read about Peter Stucky case]

Gattis says buyers of new homes in Texas, who are often first-time buyers, have to be better protected.

"When you're talking about the No. 1 investment asset vehicle that anybody owns, there ought to be some protections there to make sure that people are not being taken advantage of," Gattis says.

Gattis is sponsoring a bill that would abolish the TRCC. But the Texas Association of Builders intends to do everything it can to kill that bill and save its regulatory agency. 

by Wade Goodwyn, NPR Weekend Edition Sunday, 03/29/2009
Source:   http://www.npr.org/templates/story/story.php?storyId=102367683

READER COMMENTS (oldest to newest)

[HOT: Texans should be ashamed that its elected officials let builders in our state get away with the sort of shenanigans reported in this National Public Radio broadcast. It caused caused lots of turmoil and reader comments, with many saying they would never move to Texas as a result. What follows is just a subset for the first few hours after airing.]

Steven Bailey (tempyy) wrote:

Now just HOW hard is it to build a house to already in place fed., state & local specs????

It seems to me that if home buyers are having that much trouble in Texas, then the best thing to do is put it all out in public, have future buyers get the codes for the house inspect the work themselves and if necessary a ball bat or 12 ga. to bring builders into line..

What I read in this article speaks of corruption in the highest offices in Texas. and as one can plainly see a LAWYER was involved right from the start...lawyer??? Get a rope...

Tom Darling (TGD) wrote:

I've long wondered whether republicans' simultaneous support for tort reform and opposition to gun control will come back to bite them. As JFK said, "If we make peaceful revolution impossible, we make violent revolution inevitable."

James Lee (Jimilee) wrote:

..time for some good ol country justice?

Kenneth Brown (Kenbrownga) wrote:

It's our own fault people....We GAVE them this power! We put the individuals in office and we didn't bother to check their Id's at the door. This is all fallout from the last frat boy administration allowing GoPac's and Porkbelly politics to control the deal making um, lawmaking in our country. 50 years ago these sorry excuses for human beings would have been run outta town on a rail. Now they hide behind lady justices skirts with filings, motions, and lawsuits. The people no longer have any power. Big government has seen to that!

Wayne Caswell (HoTexas) wrote:

Homeowners of Texas is a non-profit working to regulate homebuilding and make builders accountable to homeowners… Check our website (www.homeownersoftexas.org) and February newsletter. To learn about expansive soil, see www.homeownersoftexas.org/Soil_Issues.pdf.
 
Ron Castle (roncastle) wrote:

Texas started going down the toilet when Dubya was governor. If Bob Perry would spread a little more cash around he might become King of Texas and get rid of petty pesky regulation.
 
Richard Mason (RCM) wrote:

Should we really feel bad for these Texas homeowners? They have probably the most corrupt government in the U. S. and they put them in office. Come on folks, Texas has always been this way; Republicans and Democrats alike have always played dirty with votes and voters. It is all about power and money in Texas. Until the citizens change the score, they will reap the harvest of the seeds they have sown.
 
elizabeth benyi (besy) wrote:

I will never move to Texas.

Pankaj Shah (Pnkj) wrote:

Remarkable story! I congratulate NPR and Ron Connally for this remarkable story. Though frivolous law-suits are harmful at times, loss of faith in the system and a feeling that there is just nobody for me out there is harmful for long term. One would hope that democracy takes care of this anomaly sooner than later.
Well done NPR!

HP Ng (MiddleUSA) wrote:

Sounds like another RepubliCON ( Oooops, I mean Replublican ) less regulation idea, i.e. screw the homeowners, business comes firts, at all costs.

Matt Shaffer (mplark) wrote:

Remember that this is the state that gave us George W. Bush. This state holds much sway also in what gets printed in school textbooks (along with California). No licensing of builders. No zoning laws. This is the state that redistricted to include a district 2 miles wide and 200 miles long.

Matthew Murrey (Mytwords) wrote:

A few weeks ago, seeing Alicia Shepard praise John Stewart because "he holds people in power accountable for what they say, he puts it in context and makes it riveting", I challenged NPR - or anyone else - to show any evidence of such reporting on NPR in the past 10 years. It was an unfair challenge because such journalism is so rare on NPR as to be nonexistent. But I have to tip my hat to Wayne Goodwyn; what a fine example of journalism. He takes a regional story that exposes the corruption and greed of the very rich, powerful, and connected - though giving them ample airtime to defend their position. He makes connections to larger national issues - tort reform, regulation, lobbying, etc. More of this NPR. More, more, more!

Cletus Hemphill (Cletus) wrote:

Wayne Goodwyn is by far the best reporter that NPR has. Well done sir. This is some fine journalism.

Ay Mytwords says: more of this please.
 
Audrey G (AudreyG) wrote:

“Out of 181 legislators, there are only six who don't take money from the Texas Association of Builders. So when the homebuilders come to Austin to lobby, the most powerful politicians in the state pay their respects."

This is a prime example of how large political contributions diminish and undermine the integrity in government.

 
Bryan B (bry75211) wrote:

What amazes me is when you look at the condition of many state agencies/institutions here in the Great State of Texas (consider insurance, healthcare, education, public safety, utilities, etc) that we continue to elect leaders at all levels of government in this state who hail from the same school of ideology.

After YEARS of status quo, Dallas County has a new DA. Not a perfect man, but also not complicit with the "way we do things around here" mentality. As opposed to the "angry rich white man" who proceeded him, the new DA has been committed to finding out the truth and rectifying wrongs committed by the "good ol boys" network.

I'm truly proud to hail from Texas. But I wonder how long people will sit and take this sort of abuse from those in power. I'm ashamed of the "we vote based on our religious beliefs" and not based on issues of governance and competence.

Wake up Texans...before all is lost. Gov. Perry and his cronies have taken us for a ride...and most of the people of Texas don't realize it.
 
Lynn Carman (karmaht) wrote:

My DH this morning thought he would brighten my day by passing along this article as he knew that it was my work that stopped this said developer and it's old news to us.

"I have a builder in my community that currently has 37 felony indictments against him - you know, over basic TRCC-type of issues," says state Rep. Dan Gattis, who represents the fastest-growing county in the state, just north of Austin."

We left TX some 20+ years ago due to the mess this builder put us into and we continue to speak out to this day on folks that don't care! No one would listen and we were threatened countless times due to the home that we purchased there.

There is more to this story!
 
Bubba Gump (bundjieiskska) wrote:

Of course these a fat cats who screw folks based on the process, it is stacked against the homeowner because it costs them to proceed and the damn board nothing, in fact there are folks sitting on it that are obviously friends of the builders, or politicians wives, etc. as usual.

Just look into to every member and who they are and who sits on the board, any consumer advocate types? Of course not they would be fired off the board instantly.
 
Jodi Smith (homeschooler) wrote:

I don't know if this would work, but how about home buyers banding together and refusing to buy new homes in Texas? Are there enough existing homes to make this feasible? It certainly would stop these homebuilders in their tracks. They could pass all the legislation they wanted, but if no one is buying the the houses they build, they'll be out of business in no time.

Probably an impossible boycott to organize, but it would be effective.

Pankaj Shah (Pnkj) wrote:

Remarkable story! I congratulate NPR and Ron Connally for this remarkable story. Though frivolous law-suits are harmful at times, loss of faith in the system and a feeling that there is just nobody for me out there is harmful for long term. One would hope that democracy takes care of this anomaly sooner than later.
Well done NPR!

Wayne Caswell (HoTexas) wrote:

Wayne Goodwyn’s report shows that sometimes “light touch" regulatory policies and “market forces" don’t work. I’d like to contribute to an investigative report that shows how homebuilding (especially in Texas) sparked the global economic collapse. IS ANYONE INTERESTED?

The spark was not just banks and SUBPRIME LOANS but also SUBSTANDARD HOMES. Builders weren’t held accountable and builder-owned finance companies (mortgage, title & insurance) were allowed to offload risky loans, encouraging them to inflate appraisals, falsify inspection reports, and approve buyers with questionable credit.

Lynn Carman (karmaht) wrote:

Sorry folks, developers will continue that they do for years to come and it will take educating those in 'Power,' whom get contributions from these folks to stop this as our communities continue to see shoddy work. Where we are now we see the same thing that we went through there in TX. We scream but they don't listen, there will be no change as we know whom foots the bills. One needs to become an educated buyer and check into what is being built. We get the SEPAs that are submitted and again we laugh at what is being done on all levels of Gov., no one is stepping up to shut down these developers as they are far reaching with their money and lobbiests. There will be no change, so let's face it!! Folks will do anything for the money they get, there are avenues that one should take before buying! If more folks would take these avenues and more developers fail then that might be the key but I don't see Gov. stopping them. Folk that buy need to do more than hire a real estate agent to help them buy their home. SEPA are not working on the State levels as I can tell you two housewives locally here stopped a developer that was going to put houses on top a a major pipeline that has killed 3 in this state. Community activism!

frank ooms (frankierayo) wrote:

This country was founded by 'the People for the People' and until such time that we come to our senses and wake ourselves up from a state of apathy, the corruption and greed of the very rich, powerful, and connected will continue to run most everything in our lives. Our forefathers would be appalled to see how the US is run by Corporate America and their elected cronies - not the People! On a larger scale, until our country finds itself again adhering to the principles of the Constitution we are in no position to criticize the rest of the world. The TRCC and all elected officials tainted by their money illustrate how awry our adherence to the Constitution has become. Justice for all has become justice for the wealthy and connected. Campaign finance reform is desperately needed, elected officials should not be bought - openly or covertly!

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