H 4997 General Bill, By Kirsh
 A BILL TO AMEND TITLE 40, CHAPTER 59, CODE OF LAWS OF SOUTH CAROLINA, 1976,
 RELATING TO RESIDENTIAL HOME BUILDERS BY ADDING ARTICLE 5 SO AS TO PROVIDE FOR
 THE LICENSURE OF FIRMS TO PRACTICE RESIDENTIAL HOME BUILDING AND RESIDENTIAL
 SPECIALTY CONTRACTING.

   04/14/98  House  Introduced and read first time HJ-12
   04/14/98  House  Referred to Committee on Labor, Commerce and
                     Industry HJ-13

A BILL

TO AMEND TITLE 40, CHAPTER 59, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO RESIDENTIAL HOME BUILDERS BY ADDING ARTICLE 5 SO AS TO PROVIDE FOR THE LICENSURE OF FIRMS TO PRACTICE RESIDENTIAL HOME BUILDING AND RESIDENTIAL SPECIALTY CONTRACTING.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. Chapter 59, Title 40 of the 1976 Code is amended by adding:

Section 40-59-400. As used in this article:

(1) 'Branch office' means a place of business separate from the principal place of business where building services are offered or provided. A specific project or construction site office is not a branch office.

(2) 'Direct responsibility', 'direct supervisory control', 'direct supervision', and 'responsible charge' all mean the direction of construction work by a residential builder or residential specialty contractor to the extent that successful completion of the work is dependent on the personal supervision, direct control, and final decisions by the qualified registrant to the extent that the qualified registrant assumes professional responsibility for the work.

(3) 'Engaged in practice' means holding oneself out generally to the public as qualified and available to perform residential building or residential specialty contracting services, or both.

(4) 'Firm' means a business entity functioning as a sole proprietorship, partnership, limited liability partnership, professional association, professional corporation, business corporation, limited liability company, joint venture, or other legally constituted organization which practices or offers to practice residential building or residential specialty contracting.

(5) 'Private practice firm' means a firm through which the practice of residential building or residential specialty contracting would require a residential business certificate of authorization as provided for in this chapter.

(6) 'Resident builder' means a licensed practitioner who spends a majority of each normal workday working out of a principal or branch office and who is in responsible charge of the office and the building services provided from that office including, but not limited to, responsibility for applying for permits for the firm.

Section 40-59-410. (A) The practice or offer to practice of residential building or residential specialty contracting through a firm is permitted only through entities holding a valid residential business certificate of authorization issued by the South Carolina Residential Builders Commission. For the purposes of this section, a residential business certificate of authorization is also required for any firm practicing in this State under a fictitious name. However, when an individual is practicing residential home building or residential specialty contracting in his name as individually licensed, or if an individual has at least fifty-one percent of the ownership interest and is the sole resident builder for the firm, that person or entity is not required to be issued a residential business certificate of authorization.

(B) The practice or offer to practice residential home building or residential specialty contracting as defined in this chapter by individual residential home builders or residential specialty contractors licensed or registered under this chapter through a firm offering residential building or residential specialty contracting services to the public is permitted if:

(1) one or more of the corporate officers, in the case of a corporation, or one or more of the principal owners, in the case of firms, or one or more employees are designated as being in responsible charge of each principal or branch office for the building services regulated by the commission and are licensed under this chapter;

(2) the firm has obtained an executed surety bond approved by the commission in the sum of fifteen thousand dollars initially and as subsequently required by regulation or proof of financial responsibility acceptable to the commission; and

(3) the firm has been issued a residential business certificate of authorization by the commission. Nothing in this section may be construed to mean that a license or registration to practice residential home building or residential specialty contracting may be held by a firm.

(B) Approval of firms seeking to incorporate or register to do business in this State under provisions of this section are contingent upon proper filing with the Secretary of State of the articles of incorporation and revisions to these articles, as certified by the Secretary of State. This section may not be construed to require an additional filing with the Secretary of State not otherwise required by law.

Section 40-59-420. A firm desiring a residential business certificate of authorization shall file with the department an application on forms provided by the department accompanied by all applicable fees. Each residential business certificate of authorization must be renewed by July 1 of the licensing period. A renewal form provided by the department must be completed and submitted with all applicable fees. The initial application fee and annual renewal fee is one hundred dollars initially and as subsequently established in regulation. Information to be provided on the application and renewal forms shall include but is not limited to, the names and addresses of all officers and directors of the firm or officers and partners of the partnership who are licensed or registered to practice residential home building or residential specialty contracting in this State including those in responsible charge of all principal and branch offices providing services in the State.

Section 40-59-430. Disciplinary action against a firm must be administered in the same manner and on the same grounds as disciplinary action against an individual. No firm is relieved of responsibility for conduct or acts of its agents, officers, or employees by reason of its compliance with this article, and no individual practicing residential home building or residential specialty contracting relieved of responsibility for professional services performed by reason of his employment or relationship with the firm.

Section 40-59-440. Nothing in this article may be construed to prohibit firms from joining together to offer residential home building or residential specialty contracting services to the public, if each separate entity providing the services in this State otherwise meets the requirements of this article. Firms practicing as a professional corporation under the laws of this State may engage in the joint practice of residential home building or residential specialty contracting with other professions.

Section 40-59-450. If the requirements of this article are met, the commission shall issue a residential business certificate of authorization to the firm, and the firm may engage or offer to engage in the practice of residential home building or residential specialty contracting. The commission, however, may refuse to issue a certificate or suspend or revoke an existing certificate for cause. A person or organization aggrieved by an adverse determination of the commission may seek judicial review in accordance with this chapter.

Section 40-59-460. (A) Residential home builders or residential specialty contractors engaged in practice through firms involving the practice of residential building or residential specialty contracting may maintain branch offices as well as a principal place of business.

(B) Each principal place of business as well as each branch office must have a resident residential builder or residential specialty contractor in responsible charge of the field and office building work or services provided. A residential home builder must supervise the residential home building aspects of the principal or branch office and may also supervise the residential specialty contracting from that location. A residential specialty contractor may supervise residential specialty contracting services of the principal or branch office as long as the services are within the scope of residential specialty contracting in the classifications for which the individual is duly authorized to engage. The resident residential home builder or residential specialty contractor is considered in responsible charge of only one place of business at a given time.

Section 40-59-470. Nothing contained in this chapter prevents an authorized residential builder or residential specialty contractor from undertaking a building project anywhere in the State."

SECTION 2. This act takes effect upon approval by the Governor.