The No Contractor Left Behind Bill (H.B. 255)

Why House Bill 2015-255 is a Bad Idea for North Carolina

                The No Child Left Behind Bill was thought to be the most comprehensive, best option for fixing a public education system that was, quite frankly, failing. It was touted by education experts as being the final cure. Its goals were laudable. Its aim was to make sure that every student received the necessary education to graduate from high school prepared to enter college or the work force. Unfortunately, as history has demonstrated, it was a total failure. Why? Time and resources are limited. Rather than allowing teachers the opportunity to focus on cultivating the brightest and best students to achieve their maximum potential, teachers were directed to spend as much time as necessary focusing on those students having the greatest difficulty in mastering the materials. Those students with the highest potential often sat in classrooms bored out of their minds, frustrated, depressed, and often turned to behavior that was less conducive to a learning environment. They became the troublemakers.
                For decades, teachers had been able to strike a balance between providing enough new material for the fastest learners and being able to spend some time with the slowest of learners. No Child Left Behind tilted the scales to favor those least capable of mastering the material at the sacrifice of the best. Since House Bill 255 does the same thing with contractors, it should be titled the No Contractor Left Behind Bill.
        Like No Child Left Behind, its goals are laudable. It seeks to make the building inspections process more efficient and more consistent by requiring inspectors to make “timely inspections” and to provide a full list of code violations during a single inspection visit. The aim is to reduce the delay and cost “caused by inspectors.”
                However, also like the No Child Left Behind bill, there are a number of fundamental flaws with this proposal. Rather than lowering the cost of building inspections programs, it raises them and rather than encouraging building contractors to build good quality homes, it encourages them to build the most minimally acceptable structures.

The Cost of Building Permits

                There are generally two types of fees generated by an inspections department: permit fees and re-inspection fees. Permit fees are generally calculated based upon the attributes of the proposed project, typically number of square feet or quantity of fixtures. Re-inspection fees are incurred when a contractor calls for a required inspection but fails to pass that inspection. Permit fees are justified on the basis that it costs a certain amount of money for an inspector to conduct inspections and are premised on the idea that a contractor can pass each inspection the first time. Therefore, you can fairly estimate how long it should take to conduct a certain type of inspection for a certain sized structure and the corresponding cost associated for that inspector’s time. This system breaks down when you have contractors who habitually fail inspections and each inspection results in numerous code violations discovered. To accommodate for these two variables, inspection departments have implemented re-inspection fees and have limited the number of code violations that they will write up before concluding that the project was not ready for inspection. The system is not designed to be punitive or inefficient. Rather, it is designed to increase efficiency by encouraging contractors to construct structures that are code compliant at the time of inspection. It is only when contractors fail inspections that their project is hindered. Whose fault is that? What causes the inefficiency here- the inspector seeking code compliance, or the contractor who failed to produce a product ready for inspection?
                Under the proposed law, inspectors will no longer be able to make the judgment call that a project is simply not ready for inspection. Once an inspection is called for, the inspector will have to point out every code violation. An inspection that would take only a few minutes at a code compliant project may take several hours at another inspection due to the number of violations. Those most harmed by this proposal are those contractors who generally pass inspections their first time and proceed with construction. Not only will they now have to wait while the inspector takes the time to point out every single flaw down the street, they can also expect to see an increase in permit fees. Contractors who once paid significant re-inspection will now pay less since they should (theoretically) only see one re-inspection fee per inspection type. However, the inspector will now be spending much more time at each inspection. Since the inspection’s department will see a significant drop in revenue from re-inspection fees, they will have no choice but to raise the cost of the initial permits. In other words, the cost of failed inspections by the worst contractors will be passed on to the best contractors. This is a system of disincentivization that is both inefficient and unfairly burdens those contractors seeking compliance and construction of good quality homes.
                To add insult to injury, the bill propose to increase the liability of inspectors and to ensure that inspections are “timely” made. How an inspector is to create any type of schedule once a single inspection can now take all day is the question inspection departments will soon be facing. In order to comply with the new law, inspections departments will need to hire excess staff ready to step in when a series of inspections, which are beyond the control of the inspector, take exceptionally longer than necessary. This again will simply add to the cost of permits for which the good contractors will have to eat the cost.

Quality of Construction

                Before I begin, it may help to put this into perspective. I once had a contractor I had just written up for a number of code violations try to impress the homeowner by saying he built a good quality home. He made the mistake of pointing at my building code book and saying “I build by that book right there.” I kindly informed both he and the homeowner that if he built by that book, he was building a pretty sorry house. The North Carolina Building Code is not a guide book for building a top quality home. Rather, it is a set of guidelines that establish the minimally acceptable level of construction to make a place habitable within the state. The state won’t let you live in a new home, or work out of a new office building, that doesn’t meet those standards. Contractors regularly failing inspection are not looking to build good quality homes, they are looking to produce the most cheaply constructed, minimally acceptable quality of construction — and failing at that.
                You may wonder how the quality of construction will decline if the building code itself doesn’t change. Let me explain. Contractors who need a bill requiring a building inspector to provide “a complete list of all items which fail” are not the kind of contractors we want building our homes. Yet, as more and more contractors realize that they can just throw anything together, call for an inspection, and let the building inspector sort it out and tell them exactly how to “make it pass inspection,” there will be less contractors willing to take the time to verify the quality of their own work. Reliance upon the inspector will increase. There will be less eyes looking for problems and unfortunately more issues will be overlooked.
                While working for a former employer, I was performing a final inspection on a new home that was already scheduled for a closing to the buyer. The contractor had been through the home, the buyer had been through the home, real estate agents and an appraiser had been through the home. Even a home inspector had been through it. I had performed an inspection of the home’s interior. It wasn’t until I was counting vents on the exterior of the house that I realized there was no exhaust duct for the clothes dryer. Fortunately for the contractor it could be vented out the adjoining wall, but it demonstrates how easily something can be missed. Do we really want to relieve contractors of the responsibility of even trying to prepare a home for inspection? I remember performing a couple of inspections and noticing code violations that I had missed on previous inspections of the same project. This seemed to occur most frequently at the projects where I had already found the most violations. Unfortunately, the longer the list of violations, the greater the likelihood that items will be missed. This proposal, if adopted, will shoulder inspectors alone with the responsibility that should be shared by both the contractor and the inspector. As a result, more violations will be missed and the public will acquire less than minimally acceptable homes.
                With the increased reliance on the inspector, the bill’s sponsors must have concluded that there might arise the opportunity for inspector’s to take advantage of unsuspecting contractor by requiring more than the code allows. To solve this dilemma, the bill includes a provision that will hold building inspectors guilty of “willful misconduct, gross negligence, or gross incompetence” for requiring anything but the bare minimum. While I agree that building inspectors lack the authority to require more than the Building Code allows, there are areas of the building code that are still gray. Inspectors in different jurisdictions do sometimes interpret the provisions differently. In each instance, at least one side must be wrong. However, with the new proposal, inspectors may begin interpreting the code in the least restrictive manner to avoid a charge of gross negligence. This least restrictive mentality may result in projects that do not meet the code’s intent and are ultimately unsafe. While there should be some recourse to inspectors who knowingly require more than the Code requires, the proposed bill goes too far. It should distinguish between differences of interpretation and true misconduct.


                Like the No Child Left Behind Bill, H.B. 255 has a number of flaws. However, also like the education bill, there are a number of aspects worthy of praise. Raising the threshold for permits is a good thing. If there are no structural or building systems alterations, there is generally less of a need for inspections. There is little need to inspect new kitchen cabinets just because they cost more than $5,000. Also, requiring code interpretations and guidance by the Building Code Council to be published online and made more accessible helps to increase the consistency of interpretations by inspections department. Uniformity of inspections will lead to fewer disagreements between contractors and inspectors. Finally, the creation of a building code committee focused specifically on One- and Two-Family dwellings will help ensure that particular attention is focused on the project type most often constructed.
                In sum, H.B. 255 will not obtain the results it aims for. While in theory it sounds like a great idea, in reality it ignores the two great limitations: time and resources. Inspectors lack the time, and inspections’ departments lack the resources to become tutors for contractors. The balance is currently where it needs to be: contractors building projects without a list of instructions from an inspector, and inspectors with enough authority to determine that a project simply isn’t ready for inspection. There is no reason to hinder projects ready for inspection to train contractors who weren’t, to pass those costs on to the better contractors, or to shoulder the full burden of code compliance on the inspector.

David M. Rief

David is a certified zoning official and licensed attorney who counsels local governments on land use issues. As a former planner and building inspector, he has a desire to help other planners, inspectors, and elected officials address the unique legal questions and challenges these public servants face.


Posted in blog | Tagged , , , , , |

Comments are closed.