What We Heard Builder Licensing Engagement Summary Report

Transcription

1 What We Heard Builder Licensing Engagement Summary Reprt Prepared by Alberta Municipal Affairs, Public Safety Divisin May 2017

2 Backgrund and Cntext Currently, there are n specific qualificatins gverning residential builders in Alberta, even under extreme circumstances such as fraud r repeated vilatins f the Safety Cdes Act r New Hme Buyer Prtectin Act. T ensure Albertans have strng cnsumer prtectin in the residential hme cnstructin industry, the Gvernment f Alberta asked fr public input n hw t best implement a builder licensing prgram. Input frm stakehlders and the public was gathered t: better understand hme buyer experiences with building a new hme; strengthen understanding f any gaps in the safety system; help determine hw t best ptimize safety and minimize risk thrugh implementing a builder licensing prgram; and infrm the develpment and define the parameters f a builder licensing prgram t best address thse gaps. Between February 14 and March 14, 2017, the Gvernment f Alberta facilitated targeted engagement sessins with members f the public and individuals invlved in the residential cnstructin industry and hsted meetings with key stakehlders including municipal representatives, warranty prviders and cnstructin-related assciatins. Gvernment als psted a survey nline t seek public feedback. Hmewners, builders, renvatrs, warranty prviders, architects, engineers and municipalities prvided input (see Appendix 1). The builder licensing engagement included the fllwing methds: Online Survey An nline survey asked Albertans t respnd n a brad range f tpics related t the current residential cnstructin industry, including gvernment s rle, satisfactin with current practices, and whether r nt they supprted gvernment explring ptins fr licensing builders. In ttal, 1,269 Albertans respnded, representing the public (38 per cent), peple in the industry (49 per cent), and municipal emplyees (13 per cent). 1 Engagement Sessins A ttal f 130 participants attended 11 engagement sessins held in Grande Prairie, Edmntn, Red Deer, Calgary, Lethbridge, and Frt McMurray. Six f the meetings were held with industry stakehlders, including builders and renvatrs, and five were held with hmewners including thse wh have built their wn hmes. The sessins allwed fr in-depth discussins t further gvernment s understanding f themes in the nline survey. 2 1 See Appendix 2 Survey Results 2 See Appendix 3 Engagement Sessin Themes 1

3 Summary f public input What is the cnsumer experience? Key questins helped determine the general satisfactin levels with residential cnstructin in Alberta, what prblems currently exist, and prvided an understanding f the scpe and magnitude f the challenges. Themes that emerged are: 1. Sme lack f verall satisfactin with the current state f residential cnstructin Overall, nly half f survey respndents (44.1 per cent) reprted that they were very satisfied r smewhat satisfied with the current state f residential cnstructin in Alberta. Builders were mre likely t reprt satisfactin (53 per cent very satisfied r smewhat satisfied), while members f the public were less satisfied (31 per cent very unsatisfied r smewhat unsatisfied) 2. Sme cncern abut the lack f required qualificatins, and the pssibility f pr wrkmanship Builders expressed a need fr better training related t specific building cmpnents (siding, building envelpe etc.), and fr basic training fr thse just getting started in the industry The majrity f hmewners did nt experience significant prblems with the safety and quality f cnstructin, but did express cncern abut pr quality wrkmanship Several hmewners indicated serius prblems with their hmes, such as water damage and mld, and did nt feel that the system was prviding adequate prtectin fr cnsumers 3. Lack f accuntability Hmewners generally felt that builders shuld be held accuntable fr quality cntrl n new buildings, but expressed frustratin with nt knwing where t g t get issues reslved. Hmewners als said they lacked understanding abut the warranty prcess and the prtectins already in place. A cmmn sentiment was that warranty prviders were seen t be acting in the interest f the builder, rather than the cnsumer Hmewners and builders expressed cncern that inspectins did nt catch prblems, and builders felt that there was a need t d mre t help prfessinalize the cnstructin industry 4. Prblems with smaller builders and renvatrs Mst builders felt that when prblems arise with quality and wrkmanship, they are mst ften assciated with smaller cmpanies 2

4 Understand where gaps may exist Participants were asked t cmment n the current system f standards, inspectins, cdes and warranty in place in Alberta. While n individual aspect f the current system was singled-ut as being either extremely effective r ineffective, a cmmn theme that emerged was the need fr gvernment t better integrate in rder t effectively use the tls in place. In terms f gaps, the fllwing key elements were als highlighted: 1. Lack f cnsumer awareness/educatin When asked abut the ease f access t infrmatin abut builders, 70 per cent f respndents indicated it was very difficult r smewhat difficult t btain infrmatin abut a builder s financial health. 66 per cent fund it smewhat r very difficult t btain infrmatin abut frmal training, and 66 per cent fund it smewhat r very difficult t find infrmatin n knwledge f building cdes As a grup, respndents wrking in the industry were less likely t respnd negatively abut accessing infrmatin n builders. Fr example, 78 per cent f public respndents indicated it was smewhat r very difficult t find infrmatin n financial viability, cmpared t 63 per cent f thse in the industry and 70 per cent f municipal emplyees. When asked abut accessing infrmatin n frmal training, 73 per cent f respnses frm members f the public were very difficult r smewhat difficult, cmpared t 57 per cent f builders The lack f reliable and cnsistent infrmatin was als nted by bth hmewners and builders 2. Expand training, mandatry trades and ccupatins fr residential cnstructin Builders said many f the cnstructin prblems they see are related t a specific cmpnent f the building. Sme suggested that these prblems culd be addressed by creating trades/ccupatins, r making trades mandatry, fr these skill sets When asked abut what factrs were imprtant in chsing a builder, 95 per cent f respndents felt knwledge f building cdes is mderately r very imprtant. Builder experience was rated mderately r very imprtant by 94 per cent f respndents Municipal emplyee respndents, including frmer safety cdes fficers, placed greater emphasis n the imprtance f frmal training when chsing a builder. A ttal f 88 per cent f municipal emplyees cnsidered frmal training t be mderately r very imprtant when chsing a builder, cmpared t 82 per cent fr members f the public and 79 per cent fr thse in the building industry When asked abut the imprtance f building cde knwledge when chsing a builder, 91 per cent f female respndents said it is very imprtant, cmpared t 80 per cent f thse identifying as male 3. Current warranty requirements are nt sufficient Builders expressed cncern abut the ability f bad builders t get warranty cverage, and that warranty requirements shuld be regulated mre clsely Hmewners raised cncerns abut the ability fr warranty prviders t cancel cverage f a new hme after cnstructin has already begun. 3

5 Hw a builder licensing prgram can ptimize safety and minimize risk There was strng supprt fr gvernment t take an enhanced rle in certain elements f the building industry, including quality f wrk assurance (76 per cent answered mderately r very imprtant), cnstructin safety (73 per cent), and site safety (71 per cent). Female respndents felt it was mre imprtant fr gvernment t take a rle in these elements f the building industry than male respndents. Seventy-eight per cent f respndents agreed that gvernment needs t explre ptins fr licensing builders. Eighty-fur per cent f thse wh identified as female answered yes, cmpared t 75 per cent f thse wh identified as male. Eighty-ne per cent f members f the public and 89 per cent f municipal emplyees supprted gvernment explring ptins fr licensing builders, cmpared t 69 per cent f thse in the building industry. Participants emphasized the need fr: 1. Sme frnt end vetting and demnstratin f qualificatins is warranted There was supprt fr based n financial viability, builder histry, track recrd and demnstrated knwledge f cnstructin practices Sme cncerns were expressed abut duplicating existing vetting dne by warranty prviders Industry participants indicated that there shuld be different levels f licensing fr different cnstructin activities Hmewners felt that cnsumer reviews, warranty histry, and safety cde cmpliance histry were als imprtant factrs t cnsider Overall, participants wanted assurances that any vetting prcess wuld be fair and reasnable, and accurately reflect the builder s cmpetencies Alignment with ther prvinces was als cnsidered desirable 2. Ability t remve builders It was agreed that an effective licensing prgram shuld include the ability fr gvernment t suspend r revke a license The ability t reinstate a license when a builder has demnstrated imprvements was als supprted Builders expressed the need fr clear, practical and reasnable criteria fr revking r suspending a license, alng with the ability t appeal All decisins shuld be fair and transparent Hw t develp a builder licensing prgram t best address gaps Participants were asked t prvide perspective n the scpe f builder licensing and, in particular, wh shuld be required t have a licence. Answers ranged frm all current builders as per the requirements f the New Hme Warranty Prgram, t any activity requiring a permit. In the end, n clear cnsensus was reached. Overall, supprt was given t a flexible and cnsidered apprach reflecting the range and cmplexity f residential cnstructin/renvatin practices. 4

6 1. Cndminiums All f the elements in the current safety system (warranties, inspectins, cdes, and standards) apply t all cndminiums. 5

7 Appendix 1 Stakehlder Meetings Meetings were held with stakehlders in March 2017 t gather feedback n the develpment f a builder licensing prgram. General Meetings A general meeting was held in Calgary n March 13, 2017, and in Edmntn n March 21, The fllwing stakehlders were invited t attend: Organizatin Twn f Sylvan Lake Safety Cdes Cuncil Safety Cdes Cuncil Alberta New Hme Warranty Prgram Canadian Hme Builders Assciatin Alberta Cnstructin Safety Assciatin City f Edmntn City f Calgary City f Calgary, Calgary Building Services City f Red Deer Red Deer Cunty Rural Municipality f Wd Buffal City f Medicine Hat City f Grande Prairie City f Lethbridge Twn f Olds Twn f Penhld Yellwhead Cunty City f Lacmbe Twn f Blakfalds Cunty f Stratcna City f Leduc Alberta Cnstructin Assciatin Safety Cdes Cuncil, Building Sub-Cuncil Alberta Apprenticeship and Industry Training Bard Central Alberta Realtrs Assciatin Realtrs Assciatin f Edmntn Alberta Land Surveyrs' Assciatin Representatives frm the Twn f Blackfalds, the City f Calgary, the City f Lethbridge, the City f Edmntn, the Cunty f Strathcna, Lamnt Cunty, the City f Red Deer, and the City f Leduc attended. 6

8 Meeting with Warranty Prviders A meeting was held with warranty prviders n March 14, Alberta warranty prviders were invited t attend, including: Warranty Prvider Alberta New Hme Warranty Blanket Hme Warranty Ltd. Millennium Insurance Crpratin Natinal Hme Warranty Grup Inc. Prgressive Hme Warranty Slutins Travellers Insurance Cmpany f Canada WBI Hme Warranty Limited Meeting with Canadian Hme Builders Assciatin (CHBA)- Alberta A meeting was held in March 2017 with several representatives frm CHBA. 7

9 Appendix 2 - Online Survey The nline survey was pen frm February 14 t March 14, It cntained several questins related t residential cnstructin in Alberta and the parameters f a builder licensing prgram. The fllwing are highlights frm the survey and d nt include all f the data btained frm the nline and in-persn input sessins. Satisfactin with Residential Cnstructin in Alberta Overall, 44.1 per cent f survey respndents reprted that they were very satisfied r smewhat satisfied with the current state f residential cnstructin in Alberta. Builders were mre likely t reprt satisfactin (51 per cent were very satisfied r smewhat satisfied), and members f the public were less satisfied (45 percent very unsatisfied r smewhat unsatisfied). Gvernment s Rle in Residential Cnstructin There was strng supprt fr gvernment t take an enhanced rle in aspects f the building industry, including quality f wrk (76 per cent answered mderately r very imprtant), cnstructin safety (73 per cent), and site safety (71 per cent). There were statistically significant differences between builders and members f the public n these questins, including site safety (73 per cent f public respndents citing it as mderately r very imprtant cmpared t 66 per cent f builders), quality f wrk (81 per cent f the public cmpared t 69 per cent f builders). Female respndents felt it was mre imprtant fr gvernment t take a rle in aspects f the building industry than thse wh identified as male. In particular, 65 per cent f wmen felt it was mderately r very imprtant fr gvernment t take an enhanced rle in timeliness f wrk, cmpared t 45 per cent f men. In additin, 86 per cent f thse wh identified as female felt it was mderately r very imprtant fr gvernment t take an enhanced rle in quality f wrk, cmpared t 74 per cent f thse wh identified as male. Imprtant Factrs when Chsing a Builder When asked abut what factrs were imprtant in chsing a builder, 95 per cent f respndents felt that knwledge f building cdes is mderately r very imprtant. Builder experience was rated mderately r very imprtant by 94 per cent f respndents. Respndents wh identified as municipal gvernment emplyees placed greater imprtance n frmal training when chsing a builder, with 88 per cent f municipal emplyees cnsidering frmal training t be mderately r very imprtant when chsing a builder, cmpared t 82 per cent f members f the public and 79 per cent f thse in the building industry. When asked abut the imprtance f building cde knwledge when chsing a builder, 97 per cent f thse respndents identifying as female respnded very imprtant, cmpared t 80 per cent f thse identifying as male. Access and Availability f Infrmatin abut Builders When asked abut the ease f access t infrmatin abut builders, 70 per cent f respndents indicated it was either very difficult r smewhat difficult t btain infrmatin abut, whether a 8

10 builder is in gd financial standing. 66 percent fund it smewhat r very difficult t btain infrmatin abut frmal training, and 66 per cent fund it smewhat r very difficult t find infrmatin n knwledge f building cdes. As a grup, respndents wrking in the industry were less likely t respnd negatively abut accessing infrmatin n builders. Fr example, 78 per cent f public respndents indicated it was smewhat r very difficult t find infrmatin n financial viability, cmpared t 63 per cent f thse in the industry and 70 per cent f municipal emplyees. When asked abut accessing infrmatin n frmal training, 73 per cent f respnses frm members f the public said this was very difficult r smewhat difficult, cmpared t 57 per cent f builders. Effectiveness f Current Regulatins When asked abut current regulatins, 32 per cent f respndents felt curt actin was mderately r extremely effective at ensuring quality and safety. Building cdes were rated as mderately r extremely effective by 28 per cent f respndents, and 26 per cent rated the mandatry new hme warranty as mderately r extremely effective. Respndents in the building industry felt that current regulatins are effective fr ensuring quality and safety. Fr example, 24 per cent f builders indicated permits were mderately r extremely effective, cmpared t 26 per cent f municipal emplyees and 16 per cent f public respndents. While 23 per cent f public respndents felt building cdes were effective at ensuring quality and safety, 31 per cent f municipal emplyees and 32 per cent f builder respndents felt the same way. There were statistical differences in respnses brken ut by gender fr the effectiveness f current regulatins; hwever, mst f the difference was in the increased number f n pinin respnses amng thse identifying as female cmpared t thse identifying as male. Fr example, seven per cent f female respndents had n pinin abut hw permits ensure quality and safety, cmpared t tw per cent f males, and 10 per cent f wmen had n pinin n the effectiveness f new hme warranties, cmpared t fur per cent f men. Restrictins n Builders Respndents were asked t specify under what circumstances a builder shuld be restricted frm perating in Alberta. Ninety-six per cent f respndents felt fraud shuld always result in a restrictin, cmpared t vilatins f the building cdes (50 per cent) and lack f frmal training (42 per cent). While there was n statistical difference between builders and the public when cnsidering fraud, builder respndents were less likely t favur restrictins fr ther issues. Fr example, 87 per cent f public respndents and 90 per cent f municipal emplyees felt building cde vilatins shuld ften r always restrict builder activity, cmpared t 74 per cent f builder respndents. Twenty-nine per cent f builders felt pr wrkmanship shuld always restrict a builder in Alberta, cmpared t 47 per cent f public respndents. Explring Builder Licensing Overall, when asked if they feel that gvernment needs t explre ptins fr licensing builders, 78 per cent f respndents said yes. Eighty-fur per cent f thse wh identified as female answered yes, cmpared t 75 per cent f thse wh identified as male. Eighty-ne per cent f members f the public 9

11 and 89 per cent f municipal emplyees supprt gvernment explring ptins fr licensing builders, cmpared t 69 per cent f thse in the building industry. Respndents were asked whether cnsumers, builders, r gvernment shuld be primarily respnsible fr aspects f residential cnstructin. Frty-tw per cent f respndents felt cnsumers bre primary respnsibility fr ensuring value fr investment. Sixty-ne per cent f respndents felt gvernment was primarily respnsible fr cnsumer financial prtectin, and 84 per cent f respndents felt builders bre primary respnsibility fr site safety. Attitudes differed based n respndent type; fr example, 16 per cent f builders felt gvernment is primarily respnsible fr quality f wrk, cmpared t 17 per cent f municipal emplyees and 27 per cent f public respndents. 10

12 Appendix 3 Engagement Sessins A ttal f 130 participants attended 11 engagement sessins held acrss the prvince. Six f these were held with industry stakehlders, including builders and renvatrs, while five were held with hmewners and thse wh have built their wn hmes. Engagement Sessins with Industry Stakehlders Summary f Feedback frm Engagement Sessins with Industry Stakehlders Builders questined the need fr a builder licensing prgram and suggested that significant prblems may nt be widespread. Sme were nt ppsed t builder licencing, and thught it wuld be difficult t make it wrk in practice and raised a number f cncerns with the cncept. A small grup f builders were supprtive f builder licensing and thught that it wuld imprve residential cnstructin by ensuring builders are qualified and cmpetent. They viewed builder licensing as a means t hld builders accuntable fr their wrk, and an pprtunity t prfessinalize the industry. The fllwing questins were asked f industry stakehlders. Participants respnses are gruped int themes. Questin 1: Are there prblems with the residential cnstructin (hme building) market in Alberta? If nt, what is wrking well? Industry stakehlders raised the fllwing issues: There are a lack f qualificatins required t becme a builder There are bad builders ut there, but the number is relatively small There are mre prblems with small building cmpanies than with large vlume builders The renvatin industry has the mst prblems in terms f quality cnstructin Renvatrs and builders agreed that anyne can be a renvatr, and thught that licensing this segment f the industry culd lead t imprvements Hmes built by hmewners have mre prblems than thse built by builders Questin 2: A system including cdes, permits, inspectins and hme warranty requirements currently exist in Alberta t ensure safety and cnstructin standards. Wuld a builder licensing prgram help t address any prblems that exist in this system? The fllwing themes emerged during this discussin: 2a Strengthen the existing system The need t imprve existing cmpnents f the safety system was identified, such as new hme warranty and safety cdes cmpliance mnitring. A large number f participants suggested that the intended utcme f builder licensing culd be achieved by imprving existing cmpnents f the system 11

13 Others thught that while imprvements culd be made, builder licensing culd be an effective additin t strengthen the existing system What We Heard abut new hme warranty prgrams perating in Alberta Bad builders shuld nt be able t get warranty Warranty prviders have an incentive t side with the builder, because builders get t chse which warranty prvider t purchase warranty frm Warranty has nt been in place lng enugh t knw if it is wrking Depsit prtectin shuld be standard with warranty Warranty requirements shuld be regulated mre clsely and builders shuld have clearly utlined respnsibilities and cnsumers can have access t perfrmance standards. What We Heard abut the Safety Cdes Inspectin System Safety cdes are applied incnsistently acrss the prvince Sme prblems are nt caught by safety cdes fficers Mandatry inspectins shuld be dne fr building envelpe and structural issues 2 b Is builder licensing is needed? Industry participants psed several questins t gvernment, and were interested in learning abut the fllwing: What prblems is Gvernment seeing in the cnstructin industry? What are the rates f prblems and issues that are ccurring? Des builder licensing reslve issues in ther jurisdictins where it is used? 2c Wuld cnsumer educatin imprve the residential building industry? The imprtance f cnsumer educatin was identified fr imprving residential cnstructin. Sme participants thught that the infrmatin is already available, while thers thught that infrmatin is lacking and builder licensing culd be used t prvide cnsumers with better and mre infrmatin. Cnsumers shuld educate themselves befre making decisins Sufficient infrmatin n builders is already available thrugh rating agencies that builders vluntarily belng t, and thrugh the Better Business Bureau Reliable infrmatin is lacking Gvernment culd supprt cnsumers by ensuring infrmatin is available, and prvide cnsumers with guidelines n what t cnsider when selecting a builder 2d Building sub-trades and training fr builders Builders reprted that many f the cnstructin prblems they see are related t specific cmpnents such as building envelpe, including siding installatin, vapur barriers, insulatin and windws. Sme thught this culd be imprved by hlding builders accuntable thrugh builder licensing, while thers suggested that these prblems culd be addressed by creating trades arund these required skill sets. Better training needs t be prvided fr building practices that fall utside f existing trades, such as building envelpe (vapur barrier, siding, etc.) There is a lack f basic training fr thse just getting started in the building industry 12

14 2e Prfessinalizatin f the industry Several builders had experience wrking in jurisdictins in Canada and internatinally where builder licensing is in place. These builders were strngly in favur f builder licensing because: Licensing builders can increase the quality f cnstructin Licensing wuld prfessinalize the industry Cnsumer cnfidence wuld be increase because cnsumers expect builders t be qualified Buildings are cmplicated structures and a builder shuld understand the science and be able t ensure the quality and integrity f the build 2f Existing practices in the building industry can weed ut bad builders Several builders suggested that existing practices in the building industry already manage risk fr the cnsumer, and that these shuld be better understd t ensure builder licensing des nt create unnecessary prcesses fr builders. Financial institutins will nt release mrtgages until it is cnfirmed that the prperty has been built and meets inspectin requirements Develpers will nt sell lts t builders wh are nt financially viable Warranty prviders als vet builders, but the warranty shuld be reviewed and strengthened t ensure it is imprved Questin 3: The prpsed builder licensing prgram wuld require builders t have an active license in rder t build, and might require builders t demnstrate that they are in gd financial standing and have the necessary skills t wrk in residential hme cnstructin. Key elements culd include: A builder applicatin prcess invlving disclsure and declaratin f: Crprate histry Build experience Financial claims and curt prceedings One Builder License and Track Recrd Publicatin f the Builder Recrd and Declaratin A prvisin t remve r suspend builders and issue rders An integrated system in which permits, hme warranty, r licensing can be withheld frm builders Wuld a builder licensing prgram like this wrk? The fllwing cmpnents were emphasized by builders: 3a Frnt-end vetting f builders fr qualificatins Financial management Financial standing Prject management Histry and track recrd 13

15 Knwledge f cnstructin practices and building science: Builders shuld knw the technical requirements f building a quality and safe hme and be able t verify that it has been built prperly Builder experience culd be used t verify skills Master builder designatin culd be a requirement fr builders Many builders wanted t ensure that any vetting prcess is reasnable, fair, and can accurately indicate whether a builder is qualified r nt 3b Different levels f licensing Industry participants indicated that there shuld be different levels f licensing fr different types f buildings, such as multi-family, single family, etc. There shuld be a graduated license prgram t ensure that new builders can enter the market, and prvide an incentive fr them t imprve their skills and cmpetencies Demerit pints culd be used as an incentive fr cmpliance and cntinuus imprvement Sme participants suggested that industry culd versee the licensing f builders 3c Ability t suspend r remve builders Participants indicated that if the prvincial gvernment is ging t suspend r remve builders, the fllwing needs t be in place: Clear, practical and reasnable criteria develped in cnsultatin with the industry The appeal prcess shuld include invlvement f thse wh understand the industry, nt just gvernment. Fr example, municipal-level panels cmprised f peers in the industry shuld be cnsidered The preference is that this includes third-party versight, r is dne by an industry grup Questin 4: T whm r what shuld builder licensing apply? Industry stakehlders wh were nt in favur f licensing at all did nt respnd t this questin. Undecided builders, and thse wh were in favur f licensing, prvided the fllwing input: Builder licensing shuld apply t any builder wh is respnsible fr rganizing the building f a residential hme License builders where a hme warranty is required Renvatrs shuld als be licensed Mst participants agreed that the majrity f prblems were with small building cmpanies and renvatrs, and that licensing shuld fcus n this segment f the industry Sme participants suggested that the prgram first licence small building cmpanies and renvatrs Others suggested the prgram start by licensing builders that cnstruct residential hmes in rder t evaluate utcmes and then expand t ther segments f the market such as renvatins A builder is the cntract administratr respnsible fr c-rdinating the entire prcess, including the mnitring f trades, finances and custmer relatins. The builder is the central agent wh is respnsible fr quality cntrl and client relatins 14

16 Engagement Sessins with Hmewners Summary f Feedback frm Engagement Sessins with Hmewners Hmewners generally expected that builders will be held accuntable fr building safe, quality hmes. Hmewners did nt have a strng understanding f the safety system and hw builder licensing might fit in it. Participants supprted imprvements t prtect hmewners and prvide them with recurse if issues arise during r after hme cnstructin. The fllwing questins were asked f hmewners. Participants respnses are gruped int themes. Questin 1: Are there prblems with the residential cnstructin (hme building) market in Alberta? If nt, what is wrking well? The majrity f hmewners did nt experience significant prblems with the safety and quality f cnstructin. Hwever, sme participants identified challenges with quality and safety, custmer service and hlding their builders accuntable, and cnsumer awareness. 1a 1b 1c 1d Safety and quality f cnstructin Several hmewners had serius prblems with their hmes, such as water damage and mld, and did nt feel that the system was prviding adequate prtectins. In these cases, cmmn themes were: The warranty prvider decided in favur f the builder Safety cdes inspectins did nt catch prblems Hmewners had t pursue litigatin t deal with the issues General cncerns with pr quality wrkmanship were identified by many participants. Hmewners thught that builders shuld be held accuntable fr quality cntrl n new builds Service Builders were nt respnding t deficiencies in a timely manner Cnstructin timelines vary significantly, leading t incnvenience and cst fr hmebuyers De-enrlments Several hmewners raised cncerns abut de-enrlment where the builder has walked away frm the prject and they are unable t get warranty cverage Cnsumer awareness Hmewners d nt knw where t g t get issues reslved, which puts them at a disadvantage when dealing with builders Hmewners d nt understand hw warranty wrks and what is cvered by warranty Hmewners suggested that gvernment shuld create a guide n key cnsideratins when building a new hme 15

17 Questin 2: A system including cdes, permits, inspectins and hme warranty requirements currently exist in Alberta t ensure safety and cnstructin standards. Wuld a builder licensing prgram help t address any prblems that exist in this system? Several themes emerged when asking hmewners abut the current safety system and whether r nt builder licensing culd address these prblems. 2a 2b 2c 2d Safety cdes inspectins Hmewners identified prblems in which the hme passed inspectin, but still had majr prblems Hmewners were cncerned that inspectin practices are nt the same in each municipality Warranty Cnsumers suggested that warranty prviders prtect the builder, nt the cnsumer, and suggested that warranty prviders shuld be held accuntable by gvernment Sme hmewners reprted prblems with the warranty appeal prcess De-enrlment A number f wner-builders raised cncerns abut a hme s warranty cverage being cancelled (knwn as a de-enrllment), and the difficulties this can cause hmewners in trying t access alternative hme warranty cverage and finding a different builder t finish cnstructin f a hme Lack f infrmatin Hmewners d nt have access t reliable infrmatin abut builders t make infrmed decisins. Hmewners wuld like access t infrmatin abut builders including: Warranty claims against builder The number f hmes built Safety cde inspectin infrmatin Crprate histry Reviews f builders are available thrugh private rating websites that builders pay t be members f, but hmewners d nt trust that this infrmatin is unbiased Cnsumers d nt knw if they have access t safety cde inspectin reprts fr their new hmes 16

18 Questin 3: The prpsed builder licensing prgram wuld require builders t have an active license in rder t build and might require builders t demnstrate that they are in gd financial standing and have the necessary skills t wrk in residential hme cnstructin. Key elements culd include: A builder applicatin prcess invlving disclsure and declaratin f: Crprate histry Build experience Financial claims and curt prceedings One Builder License and Track Recrd Publicatin f the Builder Recrd and Declaratin A prvisin t remve r suspend builders and issue rders An integrated system in which permits, hme warranty, r licensing can be withheld frm builders Wuld a builder licensing prgram like this wrk? Hmewners generally supprted the idea f builder licensing. Sme were strngly in favur f licensing builders, while thers were nt cnvinced that the prgram wuld prvide additinal prtectin. All hmewners agreed that it was imprtant t ensure that builders are held accuntable fr their wrk. The fllwing were cmmn themes: Hmewners supprted requirements fr builders t demnstrate that they have the necessary knwledge t build safe, quality hmes Cncerns were raised that the cst f builder licensing culd lead t mre expensive husing Licensing wuld make it pssible t stp prblem builders frm building again, but it wuld nt prevent bad builders frm starting a business in Alberta Sme hmewners wanted t knw hw builder licensing wrks in ther prvinces, and hw successful these prgrams have been Sme hmewners thught that existing prtectins thrugh hme warranty and safety cde enfrcement are adequate, and that the utcmes f builder licensing culd be achieved by addressing issues within these systems Hmewners respnded favurably t the prpsed cmpnents f builder licensing. Participants prvided the fllwing feedback n the cmpnents listed: 3a Frnt-end vetting f builders Participants indicated that the fllwing shuld be included in the vetting f builders: Hme warranty insurance claims histry Annual financial statements Builder invlvement in de-enrlments Cnsumer reviews Safety cde cmpliance histry 17

19 3b Suspensin f licenses Hmewners nted that licensing wuld nly wrk if the gvernment is willing t revke a licence. While it is imprtant t be able t suspend a licence, builders felt there shuld be an pprtunity t demnstrate imprvements t have licenses reinstated When remving a builder s license, the prvince shuld ensure that ptential impacts t hmewners currently having hmes cnstructed are mitigated 3c Onging prtectins Hmewners suggested a number f nging prtectins that culd be a part f builder licensing: Additinal financial prtectins fr hmewners culd include: A percentage f the price f the hme shuld be held back fr ne year Builders bnds r a letter f credit held by the prvince External third-party inspectins shuld be required fr new hmes Builders shuld nt be able t pull permits until they reslve any cmpliance issues Spt-checks and audits shuld be used t ensure builders are meeting standards 3d Licensing mdel The prvince shuld base the licensing mdel n lessns learned frm ther jurisdictins that have a licensing system in place A graduated license with varius classes f licenses wuld ensure smaller cmpanies culd enter the market and prgress Demerit pints culd be used t encurage cmpliance The licensing mdel shuld include incentives fr gd behavir. Fr example, a builder culd get lwer warranty premiums fr having a gd track recrd 3e Cnsumer educatin A strng cnsumer educatin cmpnent shuld be a part f a builder licensing prgram, including: A guideline fr what t lk fr in a builder and key cnsideratins when building a hme Centralized infrmatin n builders fr cnsumers t access Questin 4: T whm r what shuld builder licensing apply? Hmewners had a number f suggestins fr the scpe f builder licensing, including: Full-scale builders nly Anything that requires a permit A builder is anyne wh crdinates r supervises sub-trades Develpers need t be included in licensing f multi-family builders Builder licensing shuld apply t any prject fr which: the cst is high there are multiple trades invlved the cnstructin prject culd impact safety Structural changes are being made 18