Certifying good builders

Seal: With the state legislature weighing bills to weed out errant builders, a trade group adopts a program to certify the good ones.

February 20, 2000|By Robert Nusgart | Robert Nusgart,SUN REAL ESTATE EDITOR

It is an idea whose time has come.

For years, builders of new homes in the Baltimore metropolitan area have resisted most pressures to place controls on their industry. Certification. Registration. Licensing. Those were evil words.

Builders would come. Builders would go. And many times in their wake would be a string of harmed homebuyers left picking up the pieces. And there would be an industry apologizing and trying to salvage its image by telling the public that it was just a couple of bad apples ruining it for the good builders.

When he joined the association 10 years ago, Michael DeStefano, a principal of Sturbridge Builders in Anne Arundel County, remembers being surprised that the trade group had no program to hold its members to certain standards.

"Back in 1990, '91 and '92, [those] were very tough times for builders," DeStefano said. "The last thing that we were worried about were things like [certification]. What we were worried about was staying in business week to week and month to month.

"Now, we've had four or five really good years, people are finally starting to pay attention to things that need to be fixed, and this is one of them."

On Wednesday, the association's executive board unanimously approved a "certified master builder/remodeler program" for its members. It makes the association one of the few in the country to offer a voluntary program that requires participating builders and remodelers to abide by specific standards.

Participating members are expected to begin to market and advertise the "certified master builder/remodeler" designation this fall.

"We don't expect that everybody is going to want to jump into this thing right off the bat," said John Kortecamp, the association's executive vice president. "Some probably won't meet the criteria or the test. Over time, as the program becomes extremely attractive and popular, consumers will rely on it more as a decision-making mechanism. Then, other builders will decide that [they] better get on this train. It will in fact help raise the bar of standards and practices."

The builders' certification requires:

Having a minimum of three years in the business.

Submitting to an audit by an independent accountant to determine financial stability.

Attending continuing education classes.

Supplying references from customers, suppliers, subcontractors and lenders.

Disclosing any legal proceedings involving them.

According to Kortecamp, the program will be run as a separate limited liability corporation and "its budget is 100 percent separate and distinct from the association." He added that the certification program will have its own board of directors and be "strictly a service that we are establishing for the membership."

Fees will depend on the size of the builder or remodeler.

In the past, a consumer got only innocuous morsels when he called the association to get information on a particular builder.

"We will go a few steps further," Kortecamp said. "Not only will we tell them which members are part of the CMBR program, but also give them an indication of what it is that these builders have attested to and had to demonstrate to become part of that program.

"We're also going to be drafting a consumer bill of rights that is going to be part of what members of this program will give to their customers that will identify the things that they ought to be looking for and the elements of protection of their interests that will be inherent in the program."

This movement to help consumers comes on the heals of builder registration legislation that is working its way through the General Assembly in Annapolis.

An industry-supported bill to register builders is scheduled to have its first hearing before the House Economic Matters Committee Tuesday. The legislation, sponsored by Republican Del. Wade A. Kach of Baltimore County and Democratic Sen. John Astle of Anne Arundel County, is scheduled to have its Senate hearing March 8.

The bill proposes a builder registration program in the consumer protection division of the attorney general's office. Among other aspects, the bill would require builders to register every two years, list their registration number on all building permits and advertising, and would require builders to arbitrate disputes between consumers.

"The builder licensing at the state level has been coming for a while," DeStefano said. "There have been some pretty high-profile cases of some pretty onerous things happening to people, and it is about time that both the state and the industry respond in its own way."

Democratic Sen. Delores G. Kelley of Baltimore has submitted a competing builder registration bill that is opposed by the association. That legislation, which has yet to be filed in the House, will also have its first Senate hearing March 8.

The Home Builders Association of Maryland program was born out of the frustration of reputable builders that have tired of being bashed in public opinion.

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