HB 27: "An Act relating to the licensure and registration of individuals who perform home inspections; relating to home inspection requirements for residential loans purchased or approved by the Alaska Housing Finance Corporation; relating to civil actions by and against home inspectors; and providing for an effective date."
00 HOUSE BILL NO. 27 01 "An Act relating to the licensure and registration of individuals who perform home 02 inspections; relating to home inspection requirements for residential loans purchased or 03 approved by the Alaska Housing Finance Corporation; relating to civil actions by and 04 against home inspectors; and providing for an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 08 is amended by adding a new chapter to read: 07 Chapter 57. Home Inspectors. 08 Article 1. Board of Home Inspectors. 09 Sec. 08.57.010. Creation and membership of board. There is created the 10 Board of Home Inspectors consisting of five members. Three members shall be 11 licensed under this chapter and shall have been engaged in the practice of home 12 inspection in the state for three years immediately preceding appointment, one 13 member shall be a licensed real estate broker or certified real estate appraiser, and one 14 member shall be a public member.
01 Sec. 08.57.020. General duties. The board shall 02 (1) administer and enforce this chapter; 03 (2) regulate the practice of home inspection; 04 (3) establish education and experience requirements that must be met 05 for licensure under this chapter; the requirements established by the board must 06 include Alaska or northern education or experience in Arctic construction or building; 07 (4) establish standards for continuing education of licensed home 08 inspectors; 09 (5) adopt a code of ethics for licensed home inspectors; and 10 (6) in addition to the meeting required under AS 08.01.070(2), meet 11 when requested by a majority of the members of the board. 12 Sec. 08.57.030. Meetings. The board may meet by teleconference. 13 Article 2. Licensure. 14 Sec. 08.57.050. Licensure required. (a) Unless exempt under AS 08.57.920 15 or serving lawfully as an associate home inspector under (b) of this section, an 16 individual may not perform a home inspection 17 (1) for new construction unless that individual is licensed as a home 18 inspector for new construction under this chapter; 19 (2) for previously occupied construction unless that individual is 20 licensed as a home inspector for previously occupied construction under this chapter. 21 (b) Notwithstanding (a) of this section, an individual who is not licensed under 22 this chapter may perform a home inspection as an associate home inspector if the 23 individual 24 (1) is employed by a licensed home inspector who supervises the 25 associate's work and the inspection is of the type that the supervising individual is 26 authorized to perform; and 27 (2) is registered with the board as an associate home inspector. 28 (c) A licensed home inspector who employs an associate home inspector 29 under (b) of this section is liable for the work done by the associate home inspector. 30 (d) An individual who holds a joint license is considered to be licensed as both 31 a home inspector for new construction and a home inspector for previously occupied
01 construction. 02 Sec. 08.57.060. Qualifications. The board shall authorize the department to 03 issue a home inspector license for new construction, previously occupied construction, 04 or both, as appropriate, to an individual who 05 (1) passes the appropriate home inspection examination; the 06 examination, which must include a written portion and other test methodologies as 07 determined by the board, must test competence in relation to Alaska construction 08 techniques and other matters as determined by the board; the examination may be 09 based on a recognized national examination or other methodology; 10 (2) meets the educational and experience requirements adopted by the 11 board in regulations for the type of license applied for; 12 (3) submits a complete application for licensure within one year after 13 passing the examination required under (1) of this section; 14 (4) within the seven years preceding the date of application, has not 15 been under a sentence for an offense related to forgery, theft in the first or second 16 degree, extortion, or conspiracy to defraud creditors or for a felony involving 17 dishonesty; and 18 (5) pays the appropriate fees. 19 Sec. 08.57.070. License renewal; continued competency. (a) A license 20 issued under this chapter may not be renewed unless the applicant submits proof of 21 continued competency relating to home inspecting that satisfies the board. 22 (b) A lapsed license may be reinstated within two years after the lapse upon 23 proof of continued competency, payment of a renewal fee for the intervening time 24 period, and payment of any penalty fee established under AS 08.01.100(b). If the 25 license has been lapsed for more than two years, the license may not be reinstated until 26 the individual also passes the appropriate home inspection examination described in 27 AS 08.57.060. A license may not be reinstated if the license has been lapsed for more 28 than five years. 29 (c) The license of an applicant whose license has been suspended or against 30 whom a fine has been imposed under this chapter may not be renewed until the period 31 of suspension has expired and any fine has been paid.
01 Sec. 08.57.080. Fees. (a) The department shall set fees under AS 08.01.065 02 for 03 (1) licensure and renewal of licensure for a home inspector qualified to 04 inspect new construction; 05 (2) licensure and renewal of licensure for a home inspector qualified to 06 inspect previously occupied construction; 07 (3) joint licenses and renewal of joint licenses; 08 (4) registration and renewal of registration as an associate home 09 inspector; 10 (5) examinations; and 11 (6) board and departmental publications and seminars related to this 12 chapter. 13 (b) An individual who fails a home inspector examination shall pay the 14 examination fee set by the department if the individual applies to retake an 15 examination. 16 Article 3. Insurance Requirement. 17 Sec. 08.57.200. Type of insurance. Each applicant for licensure, at the time 18 of applying for licensure or for renewal of licensure, shall file with the board 19 satisfactory evidence that there is in effect for the applicant public liability and 20 property damage insurance covering the applicant's home inspecting operations in this 21 state in the sum of not less than $20,000 for damage to property, $50,000 for injury, 22 including death, to any one person, and $100,000 for injury, including death, to more 23 than one person. 24 Sec. 08.57.210. Suspension of license. If insurance required in AS 08.57.200 25 ceases to be in effect, the license of the home inspector shall immediately be 26 suspended until the insurance has been reinstated. 27 Article 4. Activities of Home Inspectors. 28 Sec. 08.57.300. Identification requirements. (a) Except as provided 29 otherwise by law, an individual who is licensed or registered under this chapter by one 30 name may not act in the capacity of a home inspector or associate home inspector 31 under any other name unless the individual is also licensed or registered under that
01 name. 02 (b) All advertising and business cards prepared by a licensed home inspector 03 or associate home inspector for the home inspection business must show the 04 inspector's name, mailing address, and license or registration number. 05 (c) Individual licensed home inspectors and partners, associates, agents, 06 salespeople, solicitors, officers, and employees of licensed home inspectors shall use 07 their true names and addresses and the true name of the home inspecting firm at all 08 times while acting in the capacity of a licensed home inspector or performing related 09 activities. 10 (d) Regardless of whether they are exempt from licensure and registration 11 under AS 08.57.920, persons who perform home inspections may not hold themselves 12 out to be licensed home inspectors or use words or titles that may reasonably be 13 confused with the title of "licensed home inspector" unless they are licensed under this 14 chapter. 15 Sec. 08.57.310. Pre-inspection document required. Before performing a 16 home inspection, a licensee or an associate home inspector shall provide to the person 17 on whose behalf a home is inspected a written document specifying 18 (1) the scope of intended inspection; and 19 (2) that the inspector will notify in writing the person on whose behalf 20 the inspection is being made of defects noted during the inspection along with a 21 recommendation, if any, that experts be retained to conduct further evaluation through 22 examination and analysis by a qualified professional, tradesperson, or service 23 technician beyond that provided by the home inspection to determine the extent of 24 defects and corrective action necessary to address the defects. 25 Sec. 08.57.320. Conflict of interest must be disclosed. (a) A licensed home 26 inspector who has a conflict of interest relating to a home inspection shall disclose that 27 conflict of interest at the time of initial substantive contact with the person requesting 28 the home inspection and confirm the conflict of interest in writing to the person 29 requesting the home inspection as soon as possible after the initial substantive contact. 30 (b) The failure of a licensee to disclose a conflict of interest as required under 31 this section does not give rise to a cause of action by a private person. However, the
01 commission may, under AS 08.57.400, impose a disciplinary sanction for violation of 02 this section. 03 (c) In this section, "conflict of interest" is when 04 (1) a relative of the licensee or a person with whom the licensee has a 05 financial relationship has a present financial interest in the property being inspected or 06 considered for inspection; or 07 (2) the licensee receives compensation from someone other than a 08 party to the home inspection contract or another party having a financial interest in the 09 outcome of the home inspection. 10 Sec. 08.57.330. Inspection report required. After performance of a home 11 inspection, a licensed home inspector shall give a home inspection report to the person 12 requesting the inspection. 13 Article 5. Disciplinary Actions; Other Enforcement Mechanisms. 14 Sec. 08.57.400. Grounds for disciplinary sanctions or other license 15 decisions. The board may take disciplinary action authorized under AS 08.01.075 or 16 refuse to grant or renew a license or registration under this chapter on a finding that 17 (1) the application is fraudulent or misleading; 18 (2) the individual has knowingly violated this chapter or a lawful order 19 or regulation of the department or the board; 20 (3) the individual is incompetent or has engaged in fraudulent practices 21 relating to home inspection. 22 Sec. 08.57.410. Administrative Procedure Act applicable. Proceedings for 23 the denial, suspension, or revocation of a license or registration under this chapter are 24 governed by AS 44.62 (Administrative Procedure Act). 25 Sec. 08.57.420. Injunction. In an action instituted in the superior court by the 26 board or the department, the court may enjoin an individual from performing a home 27 inspection in violation of this chapter. In addition to other relief, the court may 28 impose a civil penalty of not more than $500 for each violation. Each day that an 29 unlawful act continues constitutes a separate violation. 30 Sec. 08.57.430. Violations. (a) An individual who knowingly violates 31 AS 08.57.050 is guilty of a class B misdemeanor. A person who violates another
01 provision of this chapter is guilty of a violation punishable under AS 12. 02 (b) Criminal prosecution for a violation of this chapter does not preclude the 03 board or the department from seeking available civil remedies. 04 Article 6. Miscellaneous Provisions. 05 Sec. 08.57.800. Legal actions by home inspector. An individual may not 06 bring an action in a court of this state for the collection of compensation for the 07 performance of a home inspection or for breach of a contract for which a license or 08 registration is required under this chapter without proving that the individual was a 09 licensed home inspector or registered associate home inspector at the time of 10 contracting for the performance of the work. 11 Sec. 08.57.810. Legal actions against home inspector. A person may not 12 bring an action against an individual licensed or registered under this chapter based on 13 a written home inspection report prepared by the inspector if the report is more than 14 180 days old or was unlawfully disclosed to the person bringing the action. 15 Article 7. General Provisions. 16 Sec. 08.57.900. Prohibited acts. (a) An individual licensed or registered 17 under this chapter, a company that employs an individual licensed or registered under 18 this chapter, or a company that is controlled by a company that also has a financial 19 interest in a company employing an individual licensed or registered under this 20 chapter may not 21 (1) perform or offer to perform, for an additional fee, repairs to a 22 subject property on which the home inspector or the home inspector's company has 23 prepared a home inspection report in the past 12 months; 24 (2) inspect for a fee any property in which the home inspector or the 25 home inspector's company has a financial interest or an interest in the transfer of the 26 property; 27 (3) offer or deliver compensation, an inducement, or a reward to the 28 owner of the inspected property, the broker, or the agent, for the referral of business to 29 the home inspector or the home inspector's company; 30 (4) without the written consent of the home inspection client or the 31 client's legal representative, disclose information from a home inspection report
01 prepared by the home inspector or the home inspector's company unless the disclosure 02 is made 03 (A) more than 180 days after the date of the report; 04 (B) to a subsequent client who requests a home inspection of 05 the same premises; or 06 (C) by the home inspector in an administrative or judicial 07 proceeding in which disclosure of the home inspection report is relevant to 08 resolution of the legal issues in the proceeding; 09 (5) without the written consent of all interested parties, accept 10 compensation from more than one interested party for the same services; 11 (6) accept from a person who has other dealings with a home 12 inspection client a commission or allowance, directly or indirectly, for work for which 13 the home inspector or the home inspector's company is responsible; 14 (7) accept an engagement to make an inspection or to prepare a report 15 in which the employment itself or the fee payable for the inspection is contingent upon 16 the conclusions in the report, preestablished findings, or the close of escrow. 17 (b) Contractual provisions that purport to limit the liability of a home 18 inspector to the cost of the home inspection report are contrary to public policy and 19 void. 20 Sec. 08.57.910. Limitation on activities. A license or registration issued 21 under this chapter does not authorize the holder to perform an activity for which a 22 license is required under provisions of this title that are outside of this chapter. 23 Sec. 08.57.920. Exemptions. (a) Notwithstanding other provisions of this 24 chapter, an individual who performs a home inspection is not required to be licensed 25 or registered under this chapter if the individual is 26 (1) employed by the federal or state government, a political 27 subdivision of the state, or a municipality or unincorporated community and the 28 employee is performing only duties that are within the employee's official duties; 29 (2) performing a home inspection only with respect to property that is 30 the individual's residence or in which the individual has a financial interest; 31 (3) registered as a civil engineer or architect under AS 08.48 and the
01 individual either 02 (A) affixes the individual's seal to the home inspection report; 03 or 04 (B) signs the report and puts the individual's registration 05 number on the report; or 06 (4) engaged as an engineer in training or architect in training who 07 works for and is supervised by a person described in (3) of this subsection and the 08 person described in (3) of this subsection affixes the person's seal to the home 09 inspection report or signs and puts the person's registration number on the report. 10 (b) A person is not considered to be performing a home inspection for 11 purposes of this chapter if the person is 12 (1) licensed as a pesticide applicator by the Department of 13 Environmental Conservation and is performing only activities within the scope of that 14 license; 15 (2) registered as an engineer or architect under AS 08.48 and is 16 performing only activities that are authorized by the Board of Registration for 17 Architects, Engineers and Land Surveyors under that registration; 18 (3) registered as a general contractor with a residential contractor 19 endorsement under AS 08.18 and is performing only activities within the scope of that 20 registration; 21 (4) certified as any type of real estate appraiser under AS 08.87 and is 22 performing only activities that are authorized under that certification; or 23 (5) certified to demonstrate that a building complies with the thermal 24 and lighting energy standards required by AS 46.11.040 and is performing only 25 activities authorized under that certification. 26 Sec. 08.57.990. Definitions. In this chapter, 27 (1) "board" means the Board of Home Inspectors; 28 (2) "department" means the Department of Community and Economic 29 Development; 30 (3) "home inspection" means a visual examination of the readily 31 accessible systems and components of a residence or intended residence that describes
01 those systems and components in accordance with standards of practice adopted by the 02 board; 03 (4) "home inspection report" means a written or oral report; the report 04 may set out a review of the condition of the following, to the extent that the residence 05 contains the following: 06 (A) heating and air-conditioning systems; 07 (B) interior plumbing and electrical systems; 08 (C) built-in appliances; 09 (D) roof, attic, and visible insulation; 10 (E) walls, ceilings, floors, windows, and doors; 11 (F) foundation and basement; 12 (G) visible structure; and 13 (H) any other items mutually agreed on by the parties; 14 (5) "home inspector" means a person who performs or offers to 15 perform a home inspection; 16 (6) "joint license" means a license that authorizes an individual to 17 inspect both new construction and previously occupied residences; 18 (7) "knowingly" has the meaning given in AS 11.81.900; 19 (8) "real estate transaction" means the transfer or attempted transfer of 20 an interest in a unit of real property or an act conducted as a result of or in pursuit of a 21 contract to transfer an interest in a unit of real property; 22 (9) "residence" means 23 (A) a single-family home; 24 (B) a duplex, triplex, or four-plex; or 25 (C) a residential townhouse or residential condominium unit. 26 * Sec. 2. AS 08.01.010 is amended by adding a new paragraph to read: 27 (37) Board of Home Inspectors (AS 08.57.010). 28 * Sec. 3. AS 08.03.010(c) is amended by adding a new paragraph to read: 29 (22) Board of Home Inspectors (AS 08.57.010) -- June 30, 2005. 30 * Sec. 4. AS 18.56.300(b) is amended to read: 31 (b) As a condition of a commitment to purchase or approve a loan under this
01 section for residential housing the construction of which begins after June 30, 1992, 02 the corporation shall require inspection of the unit of residential housing that is the 03 subject of the loan. The inspection must be performed by a municipal building 04 inspector, by a person who is approved or certified to perform residential inspections 05 by the International Conference of Building Officials or the International Association 06 of Electrical Inspectors, by an individual who is licensed or registered under 07 AS 08.57.050 to perform home inspections [OR, WHEN THE UNIT OF 08 RESIDENTIAL HOUSING IS LOCATED IN A RURAL AREA], by an architect 09 licensed under AS 08.48, by an engineer licensed under AS 08.48, or by another 10 person approved by the corporation. When the unit of residential housing is located in 11 a rural area, the person who makes the inspection may use methods other than a 12 personal physical inspection to make the inspection if the method is approved by the 13 corporation, and variations from the applicable code may be accepted at the 14 corporation's discretion, if the person authorized to inspect the unit under this 15 subsection satisfies the corporation that the variation does not adversely affect the 16 structural integrity of the unit or the health and safety of the residents. The person 17 who makes the inspection shall determine whether the construction conforms to 18 relevant provisions of the construction codes of the municipality or of the state 19 building code, as applicable, at each of the following stages of construction: 20 (1) plan approval; 21 (2) completion of footings and foundations; 22 (3) completion of electrical installation, plumbing, and framing; 23 (4) completion of installation of insulation; 24 (5) final approval. 25 * Sec. 5. AS 18.56.300(b) is amended to read: 26 (b) As a condition of a commitment to purchase or approve a loan under this 27 section for residential housing the construction of which begins after June 30, 1992, 28 the corporation shall require inspection of the unit of residential housing that is the 29 subject of the loan. The inspection must be performed by a municipal building 30 inspector, [BY A PERSON WHO IS APPROVED OR CERTIFIED TO PERFORM 31 RESIDENTIAL INSPECTIONS BY THE INTERNATIONAL CONFERENCE OF
01 BUILDING OFFICIALS OR THE INTERNATIONAL ASSOCIATION OF 02 ELECTRICAL INSPECTORS,] by an individual who is licensed or registered under 03 AS 08.57.050 to perform home inspections, by an architect licensed under AS 08.48, 04 by an engineer licensed under AS 08.48, or by another person approved by the 05 corporation. When the unit of residential housing is located in a rural area, the person 06 who makes the inspection may use methods other than a personal physical inspection 07 to make the inspection if the method is approved by the corporation, and variations 08 from the applicable code may be accepted at the corporation's discretion, if the person 09 authorized to inspect the unit under this subsection satisfies the corporation that the 10 variation does not adversely affect the structural integrity of the unit or the health and 11 safety of the residents. The person who makes the inspection shall determine whether 12 the construction conforms to relevant provisions of the construction codes of the 13 municipality or of the state building code, as applicable, at each of the following 14 stages of construction: 15 (1) plan approval; 16 (2) completion of footings and foundations; 17 (3) completion of electrical installation, plumbing, and framing; 18 (4) completion of installation of insulation; 19 (5) final approval. 20 * Sec. 6. AS 44.62.330(a) is amended by adding a new paragraph to read: 21 (60) Board of Home Inspectors. 22 * Sec. 7. AS 45.50.471(b) is amended by adding a new paragraph to read: 23 (43) violating AS 08.57.320, 08.57.330, or 08.57.900. 24 * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section to 25 read: 26 REGULATIONS. The Board of Home Inspectors may proceed to adopt regulations to 27 implement this Act. A regulation adopted under this section takes effect under AS 44.62 28 (Administrative Procedure Act) but not before the effective date of the law implemented by 29 the regulation. 30 * Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section to 31 read:
01 INITIAL BOARD MEMBERS. Notwithstanding AS 08.57.010, added by sec. 1 of 02 this Act, the three home inspectors appointed to the initial Board of Home Inspectors are not 03 required to be licensed as home inspectors before appointment but must be licensed as home 04 inspectors in order to be appointed or reappointed after expiration of their first term in office. 05 * Sec. 10. The uncodified law of the State of Alaska is amended by adding a new section to 06 read: 07 TRANSITIONAL LICENSING PROVISIONS. (a) Notwithstanding AS 08.57, 08 added by sec. 1 of this Act, the Board of Home Inspectors shall issue a joint license that is 09 valid until January 1, 2003, to an individual who submits to the board satisfactory evidence of 10 being in the business of home inspection in the state at the time of application for a license 11 under this subsection and of having 12 (1) been in the business of home inspection in the state on October 1, 2000; or 13 (2) passed the building inspector examination or property maintenance and 14 housing inspector examination given by the International Conference of Building Officials. 15 (b) Notwithstanding AS 08.57, added by sec. 1 of this Act, the Board of Home 16 Inspectors shall issue a license to practice home inspection of previously occupied residences 17 that is valid until January 1, 2003, to an individual who submits to the board satisfactory 18 evidence of being in the business of home inspection in the state at the time of application for 19 a license under this subsection and of having passed 20 (1) the national home inspector examination given by the American Society of 21 Home Inspectors; or 22 (2) the examination of the Examination Board of Professional Home 23 Inspectors. 24 (c) Notwithstanding AS 08.57, added by sec. 1 of this Act, the Board of Home 25 Inspectors shall issue a license to practice home inspection of new construction that is valid 26 until January 1, 2003, to an individual who submits to the board satisfactory evidence of being 27 in the business of home inspection in the state at the time of application for a license under 28 this subsection and of having passed the combination inspector examination or the 29 combination dwelling inspector examination given by the International Conference of 30 Building Officials. 31 (d) Notwithstanding AS 08.57, added by sec. 1 of this Act, the Board of Home
01 Inspectors shall grant registration as an associate home inspector that is valid until January 1, 02 2003, to an individual who submits to the board satisfactory evidence of being employed by 03 an individual who is in the business of home inspection and is licensed under this section or 04 under AS 08.57. 05 (e) A license or registration issued under this section may not be renewed or 06 extended. 07 (f) Except as provided in (e) of this section, a license or registration issued under this 08 section is considered to be a license or registration issued under AS 08.57, added by sec. 1 of 09 this Act. 10 (g) In this section, "joint license" has the meaning given in AS 08.57.990, added by 11 sec. 1 of this Act. 12 * Sec. 11. AS 08.57.050, 08.57.300 - 08.57.330, 08.57.430(a), 08.57.800 - 08.57.810, 13 enacted by sec. 1 of this Act, and the amendment of AS 18.56.300(b), made by sec. 4 of this 14 Act, take effect July 1, 2002. 15 * Sec. 12. Section 5 of this Act takes effect January 1, 2003. 16 * Sec. 13. Except as provided in secs. 11 and 12 of this Act, this Act takes effect 17 immediately under AS 01.10.070(c).