TRCC Sunset Recommendation

Homeowners of Texas, Inc. (HOT) presents this summary of the Sunset Advisory Commission staff report, which took the unusual step of recommending that legislators abolish a state agency, the Texas Residential Construction Commission (TRCC).

• Consumer Distrust: The report concludes that the TRCC is "fundamentally flawed" and should be entirely abolished because it has caused widespread harm to consumers by protecting builders from accountability and failing to protect homeowners while denying them timely access to the courts.
• Diminished Access to Courts: A Texas homeowner who has purchased or built a defective new home and cannot get the builder to repair the home is prohibited by state law from suing the homebuilder before first going through the State Inspection & Resolution Process (SIRP). According to the Staff Report, the average time to process SIRP requests is 147 days (almost 5 months), and if the homeowner repairs the defects while the inspection request is pending, the case is then administratively closed.
• No Enforcement: Once the State Inspection Process is complete and a defect is confirmed, the Commission lacks authority to ensure that confirmed defects are repaired. If a builder repeatedly refuses to submit an offer to repair, the Commission can take administrative action against the builder, but so far, the TRCC has not used this authority.
• No Licensing: In Texas you need a license to drive a car or catch a fish, and a license is needed by your barber, tow truck operator and tattoo, but not your builder. 28 states license homebuilders, including 10 out of 13 southern states. Texas, Oklahoma and Kentucky are the only southern states that don’t license homebuilders.
• Registration vs. Regulation: The TRCC only requires builders to register, and they don’t have to prove that they have either a basic knowledge of construction or that they are financially sound. The reality is that the TRCC was created to protect homebuilders, not homeowners.
• Inspection Process: Since the TRCC opened its doors in early 2004 only 12% of all State Inspection cases have resulted in a satisfactory offer of repair or compensation. There is also no system in place for processing urgent cases involving habitability issues, such as structural problems, major leaks, or heating and air conditioning systems.

HOT is working with the Texas Sunset Advisory Commission staff, home inspectors, engineers, and consumer groups across the state to reform the TRCC, protect homeowners and regulate residential construction.