Bill Caption

Fiscal Notes

Bill Analysis

Summary of Legislation: 

• This legislation extends the Department of Housing and Community Affairs for 12 years.
• Moves penalty appeals from the Department of Housing and Community Affairs to the State Office of Administrative Hearings and requires a judicial review of the decisions made after the appeals process.
• Directs the department’s board to adopt policies related to the debarment of persons on grounds of repeated violations of conditions imposed by the department, and allows the appeal of debarments to the department.
• Directs the governing body of a municipality administering development to use voting resolutions rather than neighborhood organization letters as first in order of criteria.  Letters from state senators and representatives regarding low-income housing tax credit applications will still be considered but no longer prioritized. 
• This legislation allows the department to establish a separate application procedure for federal emergency funds outside the required deadlines for normal application.
• Allows for the dismissal of a complaint by an authorized employee if a violation did not occur; or the complaint is outside the department's jurisdiction.
• Directs the department to come up with negotiated rulemaking and alternative dispute resolution procedures. 
• Establishment of license “reprinting” fees is granted. 
• This bill conducts the department to perform a fingerprint-based criminal background check of all license holders and perspective licensees. 
• Authorizes the director to order a manufacturer, retailer, and installer to pay refunds directly to the customer rather than the department serving as a third party proxy for more direct consumer compensation.
• HB 3361 authorizes the director to issue without notice, an immediate cease and desist order if there is reasonable cause to believe that a person has violated or is about to violate a law, rule, or written agreement. This applies to manufactures, retailers, brokers, installers, salespersons, or persons operating without a license in these fields.
• The statutory reporting requirements for: contract for Deed Conversion Guarantee Program, energy and peak demand savings, are repealed.

Notes:  The rulemaking authority granted with respect to negotiated rulemaking and alternative dispute resolutions is subject to the Administrative Procedures Act which is a very transparent process.

Concerns: 

1) Article 3. SECTION 3.01. Section 2306.6022, Government Code HB 3361 Says that, “authorized employees may dismiss a complaint if an investigation reveals that a violation did not occur”.  This sounds like a responsible course of action. However it does not specify if the complainant has the right to appeal dismissal. 

2) Sec. 1201.1031.  Criminal history record information requirement for license.  This section requires manufactures, retailers, brokers, installers, or salespersons, to undergo criminal history background checks and fingerprinting with the Department of Public Safety and the Federal Bureau of Investigation.  Additionally it disqualifies one from the issuance of an occupational license or the renewal of a license if their fingerprints and complete criminal background history is not recorded. Applicants are furthermore required to report and record any other criminal justice agency that they may have come in contact with. 

The right to pursue one’s own industry is an inherent part of our culture and tradition. Disqualifying otherwise qualified people from the profession of their choice simply because of an encounter with the law at some point in their past is antithetical to our traditions and to free market principles. This leaves an entire segment of society nearly unemployable with no means of providing a quality living in their field of choice or providing adequately for their family.

3) The "emergency cease and desist" that this bill expands concentrates too much power in the hands of regulators by taking away due process rights for market participants. Rather than expanding this power, it should be removed completely.

Currently the director has cease and desist authority related to licensees; this legislation expands the director’s authority by granting power to stop an individual or entity operating without a license. The director would also be authorized to assess administrative penalties on unlicensed individuals or entities of up to $1,000 for each day of the violation if “the director has reasonable cause to believe that a person has violated or is about to violate a provision under his/her jurisdiction." While it may in fact be necessary to stop a person from operating without a license, this should be done with full due process. Due process of law is not a burden for regulators and it serves to protect the legal rights of citizens.

Recommendations: 

This legislation contains some provisions that serve to limit government, however it also contains provisions that expand government. Due to this conflict between supporting and opposing our liberty principles we are neutral on this bill.