ALBANY — A new bill in Albany initiated because of abuses suffered by homeowners trying to repair and rebuild after superstorm Sandy would make it easier for the state to penalize fraudulent contractors on behalf of survivors of natural disasters.
The measure, which would require a "certificate of registration" for contractors, is envisioned to be a deterrent against fraud by lowering the threshold for penalizing a contractor who collects a big deposit then never shows up for work or otherwise falls short in promised work after a natural disaster. That was the case for many home and business owners after superstorm Sandy in 2012. The bill states that such fraud by home contractors after natural disasters is rising, particularly when the jobs include state and federal disaster aid.
Under the bill, the penalty for fraud would double to $1,000 plus attorney fees and any other costs incurred by the owner for late, inadequate or failed service by a contractor. They also would have to provide permanent contact information that would help homeowners sue them. The new certification would be in addition to current licensing of most contractors.
The proposal sponsored by State Sen. Todd Kaminsky (D-Long Beach) was introduced this month and immediately sent to the powerful Rules Committee. That could fast-track the bill to the Senate floor for a vote as early as January, when the legislative session begins.
The certificate of registration would have to be renewed every two years by every home contractor operating in the state. The contractor would have to prove “good moral character” and provide proof of insurance as well as contact information. In awarding the certificate, the state secretary of state’s office could consider whether a contractor had been convicted of fraud or deceit of a customer and the number of complaints against the contractor, according to the bill. The agency could suspend, revoke or refuse to renew a certificate.
The bill referred to stories in Newsday that showed survivors of Sandy, often cash-strapped and trying to recover emotionally, who faced long periods without repairs to their homes. Kaminsky announced introduction of the bill last week with Nassau County District Attorney Madeline Singas.
“After major disasters like superstorm Sandy, unlicensed contractors or ‘storm chasers’ may come into affected neighborhoods, soliciting business,” said Claire Rosenzweig, president and CEO of the Better Business Bureau Serving Metropolitan New York. “It’s so important for consumers to check on home improvement contractors with government licensing agencies and the Better Business Bureau at bbb.org before hiring — and if necessary, file complaints with regulators and BBB.”
The New York State Builders Association supports much of the proposed legislation, but has concerns.
The bill is "an important first step in addressing fraudulent home improvement contractors and holding them accountable," the trade group and lobbyist for home builders and remodelers told Newsday in a statement. "However, our concern lies with the state’s potential requirement of mandatory fees associated with this proposed legislation without providing ways to root out shady contractors."
The association said while it is for general liability and worker compensation requirements for remodelers and builders, "We hope to work with Senator Kaminsky to find ways to improve this bill. Our members are the best builders and remodelers in New York State and we collectively want to eradicate bad actors in our industry."
Kaminsky said the bill is primarily aimed at “fly-by-night” contractors from out of state who descend on disaster areas to make a quick buck. He said Assemb. Michael Cusick (D-Staten Island), is expected to co-sponsor the bill. Cusick didn’t immediately respond to a request for comment.
“We learned by seeing shady people coming into the state for a minute, they get whatever temporary certification they need, and they can’t be found again, or they do half the job or none of the job and then go,” Kaminsky said in an interview.
He said the current law favors contractors as long as they make any effort — even if it isn’t sustained — to do a job for which they were paid.
“It’s been extremely frustrating for so many Sandy victims to be victimized again after the storm by shady operators,” he said.
The NYC/Long Island Chapter of the National Association of the Remodeling Industry and the New York State Builders Association didn’t respond to requests for comment.