HOUSE 2nd Reading Unamended May 1, 2015First Regular Session Seventieth General Assembly STATE OF COLORADO ENGROSSED This Version Includes All Amendments Adopted on Second Reading in the House of Introduction LLS NO. 15-1033.01 Bart Miller x2173 HOUSE BILL 15-1385 HOUSE SPONSORSHIP Tyler and Kraft-Tharp, SENATE SPONSORSHIP Ulibarri, House Committees Senate Committees State, Veterans, & Military Affairs Finance Appropriations A BILL FOR AN ACT Concerning a process for external review of the construction of new multi-family attached housing, and, in connection therewith, the validation of this construction based on the results of the external review and making an appropriation. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) The bill establishes a voluntary procedure for the external review and validation of construction of new multi-family attached housing. The external review is voluntary and is paid for by the builder. The external review and validation is conducted by a trained independent contractor. An external review and validation is audited by the division of housing (division) in the department of local affairs. The state board of housing promulgates rules for the validation of external reviews conducted under the bill and for audits by the division. The rules must contain design plan, foundation construction, and major structural subsystems review and criteria for gold, silver, and bronze levels of validation. The division maintains a registry of construction defect complaints received by the division for multi-family attached housing. Defects must be reported in good faith within a reasonable time after the homeowner has discovered the defect. The bill requires a builder of multi-family attached housing to disclose to a purchaser whether or not the builder contracted to conduct external review and validation under the bill and the results of the external review and validation. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, add 24-32-3307.5 as follows: 24-32-3307.5. Multi-family residential construction - voluntary quality control inspections. (1) The director shall establish and administer a procedure for the external review and validation of new construction of multi-family attached housing. The external review and validation conducted under this section is voluntary, paid for by the builder of the multi-family attached housing, and utilizes the services of a trained independent contractor conducting the review. The division shall audit external reviews and validations conducted under this section. (2) The board shall promulgate rules for the validation of external reviews conducted under this section and for audits conducted by the division. The rules must include, at a minimum, design plan, foundation construction, and major structural subsystems review. The rules must contain criteria for gold, silver, and bronze levels of validation of external reviews conducted under this section. (3) The division shall maintain a registry of construction defect complaints received by the division for multi-family attached housing. The board shall promulgate rules on the reporting of construction defects by homeowners of multi-family housing. A defect must be reported in good faith within a reasonable time after the homeowner has discovered the defect. SECTION 2. In Colorado Revised Statutes, 24-32-3301, amend (2) (c) and (2) (d); and add (2) (e) as follows: 24-32-3301. Legislative declaration. (2) The general assembly further declares that in enacting this part 33, it is the intent of the general assembly that the division establish through the board rules as it deems necessary to ensure: (c) The registration of manufactured home installers and the creation of uniform standards for the installation of manufactured homes on a statewide basis; and (d) The safety of hotels, motels, and multi-family structures in areas of the state where no construction standards for hotels, motels, and multi-family structures exist; and (e) The external review and validation of multi-family attached housing conducted under section 24-32-3307.5. SECTION 3. In Colorado Revised Statutes, 24-32-3302, add (2.5), (6.5) and (25.5) as follows: 24-32-3302. Definitions. As used in this part 33, unless the context otherwise requires: (2.5) "Builder" means the owner or developer, or both, of improved real property used or intended to be used as multi-family attached housing. (6.5) "Director" means the state director of housing appointed under section 24-32-704. (25.5) "Multi-family attached housing" means any improved real property used or intended to be used as a residence and that contains more than one attached dwelling unit. Multi-family housing includes a condominium or cooperative. SECTION 4. In Colorado Revised Statutes, 24-32-3304, amend (1) (a) and (1) (e) as follows: 24-32-3304. State housing board - powers and duties. (1) The board shall have has the following powers and duties pursuant to this part 33: (a) To promulgate uniform construction and maintenance standards for hotels, motels, and multiple-family dwellings in those areas of the state where no standards exist and to promulgate rules for the external review and validation of multi-family attached housing; (e) To promulgate rules establishing specific standards for the use of private inspection and certification entities to perform the division's certification and inspection functions with respect to in-state and out-of-state inspections of manufactured housing units and the external review and validation of multi-family attached housing. The standards shall must allow, consistent with section 13 of article XII of the state constitution, the provisions of part 5 of article 50 of this title, and the rules of the state personnel board, for the use of private inspection and certification entities when the entities are available at a reasonable cost. The standards shall must not prohibit a manufacturer or builder from having the option to contract with the division or an authorized quality assurance representative to perform inspection and certification functions. SECTION 5. In Colorado Revised Statutes, 24-32-3305, amend (1) (d) and (3) as follows: 24-32-3305. Rules - advisory committee - enforcement. (1) The board shall promulgate rules as it deems necessary to ensure: (d) The safety of hotels, motels, and multi-family structures in areas of the state where no construction standards for hotels, motels, and multi-family structures exist and the conduct of the external review and validation of multi-family attached housing under section 24-32-3307.5. (3) The board shall consult with and obtain the advice of an advisory committee on residential and nonresidential structures in the drafting and promulgation of rules. The committee shall consist of twelve members appointed by the state director of housing from the following professional and technical disciplines: One from architecture, one from structural engineering, three from building code enforcement, one from mechanical engineering or contracting, one from electrical engineering or contracting, one from the plumbing industry, one from the mobile home industry, one from the construction design or producer industry, one from manufactured housing, and one from organized labor. Committee members shall be reimbursed for actual and necessary expenses incurred while engaged in official duties. SECTION 6. In Colorado Revised Statutes, add 38-35.7-109 as follows: 38-35.7-109. Disclosure - external validation and review - multi-family attached housing. (1) A person that builds new multi-family attached housing shall disclose to the purchaser whether or not the builder contracted to conduct external review and validation of the construction of the new multi-family attached housing under section 24-32-3307.5, C.R.S. If the builder contracted to conduct external review and validation, the builder shall disclose the results of the external review and validation. (2) As used in this section, unless the context otherwise requires, "multi-family attached housing" has the same meaning as set forth in section 24-32-3302 (25.5), C.R.S. SECTION 7. In Colorado Revised Statutes, 24-32-3307, amend (1) as follows: 24-32-3307. Noncompliance with standards. (1) The state director of housing may obtain injunctive relief from the appropriate court to enjoin the manufacture, substantial repair or alteration, sale, delivery, or installation of factory-built housing by filing an affidavit specifying the manner in which the housing does not conform to the requirements of this part 33 or to rules promulgated pursuant to section 24-32-3305. The director or the director's designee may suspend the issuance of insignias of approval while injunctive relief is being sought. SECTION 8. In Colorado Revised Statutes, amend 24-32-3313 as follows: 24-32-3313. Injunctive relief. The state director of housing may request the appropriate court to enjoin the sale or delivery of any factory-built structure upon an affidavit, specifying the manner in which the factory-built structure does not conform to the requirements of this part 33 or the rules promulgated pursuant to this part 33. The director may suspend the authority of a manufacturer to affix insignias while injunctive relief is being sought. SECTION 9. In Colorado Revised Statutes, 24-32-3327, amend (1) introductory portion and (4) introductory portion as follows: 24-32-3327. Inspections. (1) For the purposes of enforcement of this part 33, persons duly designated by the state director of housing, upon presenting appropriate credentials to the owner, operator, or agent in charge, are authorized: (4) The state director of housing is authorized to contract, as an agent for the federal government to: SECTION 10. Appropriation. For the 2015-16 state fiscal year, $25,000 is appropriated to the department of local affairs for use by the division of housing. This appropriation is from the building regulation fund created in section 24-32-3309 (1) (a), C.R.S. To implement this act, the division may use this appropriation for the manufactured buildings program. SECTION 11. Act subject to petition - effective date. This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 5, 2015, if adjournment sine die is on May 6, 2015); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2016 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor.