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HomeMy WebLinkAbout814_Part 5 Ch 2_Repealing Contractor's License RequirementCITY OF OWASSO, OKLAHOMA ORDINANCE NUMBER 814 AN ORDINANCE RELATING TO PART 5 BUILDING REGULATIONS AND CODES, CHAPTER 2 PLUMBING REGULATIONS, SECTION 5-204 PLUMBERS' REGISTRATION, FEES; CHAPTER 3 ELECTRICAL INSTALLATIONS SECTION 5-302 REGISTRATION REQUIRED, FEE; CHAPTER 8 MECHANICAL CODE SECTION 5-803 LICENSE REQUIRED, FEE; AND CHAPTER 8 MECHANICAL CODE SECTION 5-805 REGISTRATION REQUIRED, FEES; OF THE CODE OF ORDINANCES OF THE CITY OF OWASSO, OKLAHOMA, AMENDING SAME AND DECLARING AN EFFECTIVE DATE. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF OWASSO, OKLAHOMA, TO-WIT: Section One: That Part 5 — Building Regulations and Codes, Sections 5-204, 5-302, 5- 803, and 5-805, of the Code of Ordinances of the City of Owasso, Oklahoma, are hereby amended to read as follows, and the same being codified as set forth below, to-wit: SECTION 5-204. PLUMBERS' REGISTRATION No person shall practice or engage in the business, trade or occupation of a Journeyman plumber, a plumbing contractor, or apprentice unless the person is registered with the state, as required by the regulations of the state health department. SECTION 5-302. ELECTRICIAN'S REGISTRATION No person shall practice or engage in the business, trade or occupation of a journeyman electrician, an electrical contractor, or apprentice unless the person is registered with the state, as required by the regulations of the state health department. SECTION 5-803. LICENSE REQUIRED,; FEE Repealed by Ordinance Number 814, 6/7/05. SECTION 5-805. MECHANIC'S REGISTRATION No person shall practice or engage in the business, trade or occupation of a journeyman mechanic, a mechanical contractor, or apprentice unless the person is registered with the state, as required by the regulations of the state health department. Section Two: The provisions of this ordinance shall become effective thirty (30) days from the date of first publication as provided by law. PASSED AND APPROVED THIS 7TH DAY OF JUNE, 2005. CITY OF OWASSO, OKLAHOMA BY: CRAIG THOENDEL, MAYOR ATTEST: SHERRY BISHOP, CITY CLERK APPROVED AS TO FORM: ATTORNEY AT LAW OWASSO REPORTER STATE OF OKLAHOMA, TULSA COUNTY, ss: Published in the Owasso Reporter, Owasso, Tulsa County, Okla. homa, June 16, 2005- Mary J. Retherford, of lawful age, being dilly CITY OF OWASSO, OKLAHOMA ORDINANCE NUMBER 814 sworn and authorized, Says that She is the pub- AN ORDINANCE RELATING TO PART 5 BUILDING REGU- liSher of the Owasso Reporter, a weekly news- LATIONS AND CODES, CHAPTER 2 PLUMBING REGULA- TIONS, SECTION 5 -204 PLUMBERS' REGISTRATION, paper published in the City of Owasso, Tulsa FEES; CHAPTER 3 ELECTRICAL INSTALLATIONS SEC - TION 5 -302 REGISTRATION REQUIRED, FEE; CHAPTER 8 County, Oklahoma, a newspaper qualified t0 MECHANICAL CODE SECTION 5 -803 LICENSE REQUIRED, FEE; AND CHAPTER 8 MECHANICAL CODE publish legal notices, advertisements and publi- SECTION 5 -805 REGISTRATION REQUIRED, FEES; OF THE CODE OF ORDINANCES OF THE CITY OF OWASSO, cations as provided in Section 1017 of Title 25, OKLAHOMA, AMENDING SAME AND DECLARING AN EFFECTIVE DATE. Oklahoma Statutes 1971 and 1983 as amended, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF and thereafter, and complies with all other re- OWASSO, OKLAHOMA, TO -WIT: qulrements of the laws r 1 Oklahoma With refer- Section One: That Part 5 — Building Regulations and Codes, Sections 5 -204, 5 -302, 5 -803, and 5 -805, of the Code of ence t0 legal publications. Ordinances of th ^, City Owasso, Ok!ahoma, are hereby amend - ed 4 read as follows, and the same being codified as set forth That Said notice, a true Copy of which is at- below, to -wit: tached hereto, was published in the regular edi- SECTION 5 -204. PLUMBERS' REGISTRATION 11011 Of Said newspaper during the period and No person shall practice or engage in the business, trade or occu- pation of a journeyman plumber, a plumbing contractor, or appren- t1i710 Of publlcatlOnS slid not in a SLlpplement 4ice unless the person is registered with the state, as required by the regulations of the state health department. on the following dates: SECTION 5 -302. ELECTRICIANS' REGISTRATION No person shall practice or engage in the business, trade or occu- pation of a journeyman electrician, an electrical contractor, or apprentice unless the person is registered with the state, as required by the regulations of the state health department. JUN] E l6l 2505 SECTION 5 -803. LICENSE REQUIRED; FEE Repealed by Ordinance Number 814, 6/7/05. 9 , SECTION 5 -805. MECHANIC'S REGISTRATION Subscribed and SWOT i1 to before me No person shall practice or engage in the business, trade or occu- pation of a journeyman mechanic, a mechanical contractor, or apprentice unless the person is registered with the state, as day of JUNE, 2005 required by the regulations of the state health department. & Section Two: The provisions of this ordinance shall become effec- tive thirty (30) days from the date of first publication as provided by avv. Notary Public PASSED AND APPROVED this 7th day of June, 2005. CITY OF OWASSO, OKLAHOMA My Commission expires: By: Craig Thoendel, Mayor ATTEST: PUBLISHERS'S FEE $ 145.50 ACCA The Essential Partner For Contractor Excellence Air Conditioning Contractors of America Heartland Chapter Green Country Chapter 6301 N. Western, #120 • Oklahoma City, OK 73118 • 866/848 -2711 • Fax: 405/840 -5730 September 28, 2004 Danny George Executive Director Oklahoma Municipal League RE: Municipal Licensing Dear Mr. George, I am writing to express concerns on behalf of Air Conditioning Contractors of America (ACCA), Plumbing Heating Cooling Contractors (PHCC), Plumbing Contractors of Eastern Oklahoma (PCEO), National Electrical Contractors Association (NECA) and Associated Building Contractors (ABC) in regards to the licensing of the electrical, plumbing and mechanical trades. We would like to review the licensing process with the Oklahoma Municipal League in hopes of reaching a mutual resolve to benefit all parties concerned. Following defines our dilemma, position and possible solution; Dilemma: In 1988 the State of Oklahoma adopted state licensing; one state testing and one bond. All contractors were elated with the idea of one test, one bond and the idea of one license in lieu of individual city testing, bonding and licensing. Much to our surprise this helped in two areas, but created a burdensome situation. Contractors, journeymen and apprentices have to license at the state level and are required to register in each municipality. When SB545 passed, it increased the burden of the contractor by ten fold. Due to the birth -month renewal process contractors are going through the renewal process every month, whereas before a contractor could renew one time per year with all of his journeymen and apprentices. The birth -month renewal has created a situation where it is extremely hard for busy contractors to keep track of his employees who need renewing each month; creating an increased risk of being fined for not renewing on time. Please keep in mind that many cities require registration to be done in person and this is a long process. Position The trades feel these regulations are unfair and causing undue burden to the contractors. It is not a requirement for lawyers, doctors, real estate agents, brokers, insurance agents or other contractors to license in each municipality where they do business. Imagine having to register your driver's license in each municipality where you travel and the inconvenience and loss of time you would experience from having to do so. Having a state license insures that the persons are qualified and bonded. I was told by a city official that if we took away municipal registration he would not be able to keep track of the journeymen. In fact, that is an erroneous statement. Many journeymen change employment during the year and do not notify the city. All contractors and journeymen must have their state license on their person when approached by an official. This should be sufficient documentation as to his legal status. Solution: We are asking for your support in abolishing the registration fees state -wide. We know that over the past several years' municipalities have had a difficult time with tax revenues, short falls and increased costs of doing business. We as contractors realize the rising costs of doing business and the effect our local economy has had on all businesses. Our recommendation is to move any lost revenues from the change over to the permit side. These costs for the contractor can easily be passed on to the customer as work is being performed. This will also decrease the municipalities' costs by reducing paperwork and labor costs. We look forward to meeting with you and reaching a solution to benefit all parties. Respectfully Submitted, Keith Deaver State ACCA President MEMORANDUM TO: THE HONORABLE MAYOR AND CITY COUNCIL CITY OF OWASSO FROM: RODNEY J RAY CITY MANAGER SUBJECT: PROPOSAL RELATING TO CONTRACTORS LICENSES DATE: January 7, 2005 BACKGROUND: The City of Owasso requires that certain contractors (electrical, mechanical and plumbing) secure an Owasso Contractors License at a cost of $100 per year. That requirement is by ordinance and was initially enacted as a method of providing both quality installations as a means of consumer protection and to allow our inspectors to know who was the licensed contractor on a particular job. Prior to 1982, there was no state licenses for these contractors. Municipal governments were required to conduct testing and licensing at the local level in order to have the desired level of control (and to revoke a contractor's ability to work in the city if the quality of their work was below the code requirements). However, from 1982 thru 1987, the State Legislature passed laws requiring electrical, mechanical and plumbing contractors to secure a state issued license and pass a state administered test before they could be licensed by any governmental entity. Subsequently, most cities began to recognize the state licenses and required each contractor to simply provide that license as a prerequisite to holding a local license. Owasso, like most other municipalities, enacted an ordinance requiring all contractors to provide the City with a copy of their license and pay a fee of $100 annually for local licenses. Additionally, the City recognizes a state issued journeyman's license as the only required license for that level of work (all journeyman licenses must be pledged to a contractor and the journeyman must work under the supervision of a licensed contractor). Last year during the 2004 Legislative session, there were discussions relating to the burden that local licensing placed on contractors. Some contractors had to apply for and hold as many as 42 local licenses. The rationale for changing the law was that the license requirement imposed by the Cities was not actually producing any results other than keeping honest contractors honest and costing them additional money while still allowing unscrupulous contractors to continue to work "out of compliance ". In 2004 the discussions relating to this issue did not proceed beyond the discussion stage. However, a consortium of associations (including a broad range of contractor groups and building groups) have joined forces this year to try to pass legislation allowing for the recognition of the state license as the only required license for electrical, mechanical and plumbing contractors. Last month a representative group of those contractors met with the OML's Legislative Committee in an attempt to receive an endorsement for their proposal. I am a member of that committee and I was appalled at the reception the group received and the lack of consideration their proposal was given. While having long been a proponent of state and local licensing for contractors; and was pleased to have guided the first of those state licenses (electrical) through the legislature in 1981, I have reached a point of questioning the need for this additional license requirement and cost of the contractor of doing business. I was, in fact, impressed with the group's presentation and felt that additional consideration should be given to the proposal. Subsequent to the presentation by the contractors, our staff met and discussed the concept. While there were initial concerns (mostly relating to change rather than the concept itself) the eventual feeling was that the proposal has merit and should be further investigated for possible enactment at our local level (even if the state does not require us to do so). Therefore, the contractors consortium has been asked to attend the Work Session on January 11, 2004 for the purpose of making a short presentation to the City Council relative to this issue. Please note the group did not request to attend but rather the staff believed it to be in the best interest of the discussion to have a presentation from those who best understand the proposal and its impact. THE CONCEPT: Generally, the concept if enacted by the City or the State would: • Recognize the State issued Electrical, Mechanical and Plumbing licenses issued by the State of Oklahoma as the only required licenses by the State, County or City Government. • There would be no Owasso Contractor License required • Inspection fees and permit fees would/could be increased to ensure a "revenue neutral" condition. • Enforcement would take place as it is currently, by requiring contractors on building projects to produce valid licenses upon request and requiring the listing of the contractor on building permits. • The local ordinance can allow the building inspector to "suspend" a contractors ability to do work in Owasso pending a review of allegations before the Owasso Board of Adjustment and finally a filing to the state for revocation of a contractor's license (essentially the same process that we now have). • The issue could be designed to be revenue neutral and would not have a fiscal impact. FISCAL IMPACT: Currently, the revenue Owasso receives from contractor licensening fees amounts to $26,000 annually. The basic concept is to increase inspection fees and building permit fees to cover the loss of that revenue. The final determination of how to assess those increases and the allocation of increase between the various existing charges has not been fully evaluated or determined (that process and proposal will await the Council's discussion of this issue). Generally, however, the staff considers this impact to be slight. ADMINISTRATIVE IMPACT: Implementation of this proposal would remove the requirement of processing hundreds of license applications for contractors and journeymen on an annual basis. It is an onerous task that seems to provide no real results and requires substantial record keeping by the staff. It is without doubt the proposal will free -up significant staff time for other duties. Additionally, the State keeps and has available the names and other information on all licenses holders in all of the contractor categories. That information is assessable on the internet at all times. ENFORCEMENT IMPACT: The concern for enforcement is centered on the City's ability to revoke the licenses of a contractor who is performing substandard work or work that is not "up to code ". The issuance of local licenses does give the City the ability to do so. However, the process required to revoke the local licenses requires the City Building Inspector to suspend the license and for the contractor to "appeal" that action to the Board of Adjustment. The staff believes that the same procedure can be built into the new ordinance with some variation of the wording so that the process allows our building officials to "suspend" the right of a contractor to do work in our City, such being subject to the same "due process" now afforded to the contractors. Simply put the impact on enforcement is minimal. COMMENTS: • The staff believes this proposal has merit and should be considered • The current system does not provide additional protection and only impacts those contractors who already comply with the law and then cost those same contractors additional money. • Although a different concept this "fits" with our overall philosophy of bringing business concepts to government. • The contractor's consortium will be making a brief presentation to the Council and Staff during the Work Session, discussion, if any, is limited to questions that the Council and staff may have. • There is concern by some staff that this action could indicate that the City is "cozy" with contractors and allowing them to have less oversight than other cities provide /require. State and National Associations Air Conditioning Contractors Of America (ACCA) Plumbing Heating Cooling Contractors (PHCC) O. Plumbing Contractors of Eastern Oklahoma (PCEO) If National Electrical Contractors Association (NECA) Associated Building Contractors (ABC) State of Oklahoma License Requirements *All Contractors, Journeymen, and Apprentices to Register with the Oklahoma's Construction Industries Board . The mission of the Construction Industries Board is to protect life and property by licensing and inspection of the related trades for the health, safety and welfare of the public. Oklahoma Construction Industries Board *The Board is composed of eleven members appointed by the Governor with the advise and consent of the Senate. For additional information regarding the Construction Industries Board, please visit their web site at: www.health.Sta.te.ok.us/CIB/ History +1980's - State of Oklahoma adopted state licensing . Goal: To establish standardized testing and only one licensing agent +One Test +One Bond + One License O Renewed Annually Oklahoma Construction Industries Board's Charge The Construction Industries Board regulates the plumbing, electrical, and mechanical trades and building and construction inspectors through the powers and duties set forth in the Oklahoma Construction Industries Board Act and in the respective licensing acts for such trades. Additional Requirements 4 /Counties and Municipalities Require Registration 4>Contractors May Carry Over 30 County and Municipal Licenses. SB545 Changes +In 2003, Oklahoma Legislature Passed SB545 • Birth -Date Renewal process increased Contractor Burden • Requires Monthly Renewals at the State, County, and Municipalities by Birth Month Imagine for a moment... What if you were required to register your drivers license- and /or hunting and fishing license in every municipality and county in which you drive, hunt, or fish? •`Inconvenience ,#`Loss of productivity *Loss of revenue Known Facts *Municipalities experiencing budget short -falls *Cost of doing business increasing *Contractors are also impacted SB545 Contractor Burden 4Increased license management Increased risk Some counties and municipalities require in person registrations *Inconsistent Implementation State License +Insures Qualified Craftsmanship +Insures Licensing and Bonding • Licenses Soon to be Internet Accessible Via Construction Industries Board • License must be available all times for surrender to city, county, or state officials upon request • Registration is not tracking mechanism Industry Position *Contractor burden is unnecessary +Law is being discriminatorily applied +Licensed Construction Contractors are being singled out from: . Lawyers . Real Estate agents and . Doctors brokers . S . Insurance agents and . Stockbrokers brokers brokers . Health Providers . Other Contractors Recommendation *Discontinue all city and county registration fees state -wide Transfer registration revenue stream to permit fees +Potential savings: • Labor Costs • Mailing Costs • Supply Costs • Data Management Expenses Questions? ACCA, PHCC, PCEO, NECA, and ASClook forward to reaching a solution to benefit all parties. Thank you for your time! Results *Reduces Overhead Costs for Contractors *Becomes Direct Cost To Customer Receiving the Benefit of the Work Performed 3