Pennsylvania Litigation Blog

The Home Improvement Contractor Registration Act has become the law in Pennsylvania and is due to go into effect this Summer. At least part of the goal of this Act is to curb the impact of “fly-by-night” contractors by requiring all contractors that work in the residential home improvement area to register in a statewide database. The Act is designed to carry enforcement provisions and serve the purposes of protecting the public as well as legitimate contractors. It is expected that a form contract will be promulgated prior to the effective date of the Act. Highlighted points include:

• Home improvement contractors will need to register and comply with the law by July 1, 2009.

• Any home improvement contractor operating in Pennsylvania must be registered.

• The Act’s definition of “home improvement contractor” is very broad and involves nearly all aspects of home maintenance/improvement.

• Registration is with the Bureau of Consumer Protection within the Office of the Attorney General.

• A $50 registration fee will be required every other year. Upon registration, the contractor will be issued a contractor identification/registration number.

• Registrants must provide personal information for all parties involved in the business.

• The state issued registration number must be placed by the contractor on all consumer documents (contracts, advertisements, business cards, etc.) used by the contractor.

• The law exempts contractors doing less than $5,000 in business annually from registering, as well as home improvement retailers having a net worth of more than $50 million (although their sub-contractors are required to register).

• The contractor must carry and have proof of liability insurance.

• Contracts are limited in the type of language they may contain and the consumer rights that can be waived or required -- a consumer’s three day right of rescission must be clearly spelled out.

• New criminal and civil penalties for home improvement fraud, failure to register and noncompliance with other requirements of the Act are specified, with varying levels of civil and criminal penalties, including misdemeanors and felonies.

• The Attorney General and the County District Attorneys will have the authority to investigate and institute criminal proceedings for any violation of this Act. The Administrative Offices of the Pennsylvania Courts are required to report to the Bureau of Consumer Protection any suspension or revocation of a registration.