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Discussion Starter · #1 ·
The Reading Eagle ran an article on Monday about the new HIC law in PA. Unfortunately, it didn't do much to clarify matters, and in some cases had conflicting information vs what's listed on the AG website.
Here's the link to the article:
http://readingeagle.com/article.aspx?id=147861

I was curious about some things, especially:
Violations include: misrepresenting the cost of materials. :blink:

So, I sent a note to the AG office. Here is the reply:

"Thank you for contacting our office regarding the Home Improvement Consumer Protection Act.
Section 517.7 of the Home Improvement Consumer Protection Act, “Home Improvement Contracts” states that every home improvement contract must include the “total sales price due under the contract.” Home improvement contract is defined as any work exceeding $500 so for any project over that amount your contract will need to state the price of the work along with the other information required by the law, including a description of the work to be performed and the materials to be used.
With regard to special order materials, for any home improvement contract in which the total price is more than $1,000, Section 517.9 of the Home Improvement Consumer Protection Act (Prohibited acts) prohibits receiving a deposit in excess of:
(i) one-third of the home improvement contract price; or

(ii) one-third of the home improvement contract price plus the cost of special order materials that have been ordered.


"Cost" of special order materials limits the cost the contractor may collect in advance for these materials to the actual cost of those materials to the contractor.
We hope this information is helpful and will assist your business in complying with the law. Additional information can be found on our website at the following link: http://www.attorneygeneral.gov/hic.aspx
On behalf of Attorney General Tom Corbett, thank you again for contacting our office."

I guess markups on special order parts are now illegal? :blink:

 

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It sounds like the markup is an issue. We usually charge the HO the same as we pay and then just a delivery fee if we need to get it for some reason. I guess then delivery goes under labor now.

(ii) one-third of the home improvement contract price plus the cost of special order materials that have been ordered.
My interpretation of this is: Say on a poured concrete sidewalk job....

Deposit of 1/3 labor and total cost of concrete.

Am I right?
 

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solar guy
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what do you mean nap?
Under a home improvement contract by a home improvement contractor the maximum deposit you can collect before starting work is 1/3

If you are buying materials from say Whore Despot they are allowed to collect the entire cost including mark up when the order is placed.
 

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Contractors:

Educate themselves about the law's requirements.

Consult an attorney to make sure that they are complying with the law.
The quote is from the article in the original post.


Why isn't the state providing a vanilla contract? Why should I have to go to an attorney and pay him so Joe Hack can charge less than me? :mad:
 

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"...plus the cost of special order materials that HAVE been ordered"

See to me that reads like you have to order the "special order materials" before you receive a deposit to cover it. I have complied and will comply with all this of course but I'm not going to say, place an order for a $5,000 door before the customer pays me for it.
 

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Thom
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I don't think concrete counts as a special order material, nor does lumber. Those are in-stock items, not special order.

On the other hand, the law says 1/3 deposit. This does not seem to prohibit you from charging the full amount (with markup) of special order materials after you have actually begun work on the project.

This should not be a problem for most contractors. You can still set up regular progress payments, you just must limit the initial deposit.

This will be a problem for those who fund the current job with the proceeds from the next and those who take the deposit and run.
 

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Why isn't the state providing a vanilla contract? Why should I have to go to an attorney and pay him so Joe Hack can charge less than me? :mad:[/QUOTE]


IF you are a member of your local Builders Association or the PA Builders Association they have a contract available to you free of charge. I had my attorney look it over and he was happy with it as it is written.
 

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Discussion Starter · #14 ·
Why isn't the state providing a vanilla contract? Why should I have to go to an attorney and pay him so Joe Hack can charge less than me? :mad:
That's exactly what I was wondering. The state requires all this stuff and then doesn't have the courtesy to at least post a "sample" contract on-line. My tax dollars at work.

Yeah, I still see just about every ad in the local paper with no HIC number.
 

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That's exactly what I was wondering. The state requires all this stuff and then doesn't have the courtesy to at least post a "sample" contract on-line. My tax dollars at work.

Yeah, I still see just about every ad in the local paper with no HIC number.
Your state along with several others released this information awhile ago. Its up to you to stay on top of the game. There are many professional publications that have been reporting on it as well. Their are loopholes so do some research.

It is your responsibility to have a contract, besides your just going to write the legal fees off at the end of the year anyway. Quit b*tching and be proactive.
 

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Discussion Starter · #17 ·
Your state along with several others released this information awhile ago. Its up to you to stay on top of the game. There are many professional publications that have been reporting on it as well. Their are loopholes so do some research.

It is your responsibility to have a contract, besides your just going to write the legal fees off at the end of the year anyway. Quit b*tching and be proactive.


I've had a copy of the law (Act 132) since last year. Unfortunately, it is very vague on certain topics and the news (as stated above) has only served to confuse the issue even further, IMHO.

The "state" has not released much more than the text of the law and a few FAQ's on the AG website. The loopholes are the problem. The professional publications have released their (or their lawyer's) interpretation of the law. Since this law is a departure from what was existing in the past in this state (being nothing), it would be helpful for the govt to provide some clear cut standards.

Asking the questions before a problem arises IS being proactive.
 
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