75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
 
SA to SB 203
 
LC 335/SB 203-2
 
                      SENATE AMENDMENTS TO
                         SENATE BILL 203
 
           By COMMITTEE ON BUSINESS AND TRANSPORTATION
 
                            March 10
 
  On page 1 of the printed bill, line 2, after '87.093 ' insert
', 701.035, 701.063, 701.098 and 701.305'.
  On page 2, delete lines 33 through 35 and insert:
  '  { +  SECTION 2. + } ORS 701.035 is amended to read:
  ' 701.035. (1) An applicant must qualify as an independent
contractor under ORS 670.600 to be eligible for a license with
the Construction Contractors Board.
  ' (2) The board shall establish two classes of independent
contractor licenses:
  ' (a) The nonexempt class is composed of the following
entities:
  ' (A) Sole proprietorships, partnerships, corporations, limited
liability companies with one or more employees; and
  ' (B) Partnerships, corporations and limited liability
companies with more than two partners, corporate officers or
members, if any of the partners, corporate officers or members
are not part of the same family and related as parents, spouses,
sisters, brothers, daughters or sons, daughters-in-law or
sons-in-law or grandchildren.
  ' (b) The exempt class is composed of all sole proprietorships,
partnerships, corporations and limited liability companies that
do not qualify as nonexempt. All partnerships, corporations and
limited liability companies must have an identification number
issued for federal tax purposes.
  ' (3) If a person who   { - qualifies for a license - }  { +
is licensed as exempt + } under subsection (2)(b) of this section
hires one or more employees or falls into any of the categories
set out in subsection (2)(a)(B) of this section, the person is
subject to penalties under ORS 701.992 for improper licensing.
 { + If a person who is licensed as exempt under subsection
(2)(b) of this section hires one or more employees, the person is
also subject to licensing sanctions under ORS 701.098. + } The
person must reapply to the board in the correct class.
  ' (4) The decision of the board that a person is an independent
contractor applies only when the person is performing work of the
nature described in ORS 701.026 and 701.060.
  '  { +  SECTION 3. + } ORS 701.035, as amended by section 15,
chapter 836, Oregon Laws 2007, is amended to read:
  ' 701.035. (1) An applicant must qualify as an independent
contractor under ORS 670.600 to be eligible for a license with
the Construction Contractors Board.
  ' (2) The board shall establish two classes of independent
contractor:
  ' (a) The nonexempt class is composed of the following
entities:
  ' (A) Sole proprietorships, partnerships, corporations, limited
liability companies with one or more employees; and
  ' (B) Partnerships, corporations and limited liability
companies with more than two partners, corporate officers or
members, if any of the partners, corporate officers or members
are not part of the same family and related as parents, spouses,
sisters, brothers, daughters or sons, daughters-in-law or
sons-in-law or grandchildren.
  ' (b) The exempt class is composed of all sole proprietorships,
partnerships, corporations and limited liability companies that
do not qualify as nonexempt.
  ' (3) If a person who   { - qualifies for a license - }  { +
is licensed as exempt + } under subsection (2)(b) of this section
hires one or more employees or falls into any of the categories
set out in subsection (2)(a)(B) of this section, the person is
subject to penalties under ORS 701.992 for improper licensing.
 { + If a person who is licensed as exempt under subsection
(2)(b) of this section hires one or more employees, the person is
also subject to licensing sanctions under ORS 701.098. + } The
person must reapply to the board in the correct class.
  ' (4) The decision of the board that a person is an independent
contractor applies only when the person is performing work of the
nature described in ORS 701.021.
  ' (5) A person that is within the exempt class described in
subsection (2)(b) of this section and is licensed as a commercial
contractor shall procure and maintain workers' compensation
insurance as authorized by ORS 656.128.
  '  { +  SECTION 4. + } ORS 701.063 is amended to read:
  ' 701.063. (1) A license is valid for two years from the date
of issuance unless the license is revoked or suspended as set
forth in ORS 701.098.
  ' (2) A license may be renewed by submitting an application for
renewal on the prescribed form, providing any additional
information required, including evidence of completion of any
required education, and submitting the appropriate application
fee, as provided by Construction Contractors Board rule.
  ' (3) The board may vary the dates of license renewal by giving
to the licensee written notice of the renewal date assigned and
by making appropriate adjustments in the fee for the license
renewal application.
  ' (4) If a contractor applies for renewal not more than
 { - one year - }  { +  two years + } after the contractor's
license lapses, upon the contractor's compliance with the
requirements of subsection (2) of this section, the board may
renew the lapsed license. The board may designate the effective
date of renewal as the last date on which the contractor was
licensed.
  ' (5) A contractor may convert a license to inactive status if
the contractor is not engaged in work as a contractor. A
contractor having an inactive license is subject to board
licensing requirements and application fees, but is not subject
to the bonding requirement of ORS 701.068 or the insurance
requirement of ORS 701.073. An inactive license is not considered
a valid license for purposes of offering to undertake
construction work, submitting a bid for construction work,
obtaining a building permit or performing construction work. A
license may not be placed or maintained in inactive status more
than once during any two-year licensing term.
  ' (6) The board shall issue a pocket-card certificate of
licensure to a contractor licensed under this chapter indicating
the type of license issued.
  '  { +  SECTION 5. + } ORS 701.063, as amended by section 25,
chapter 836, Oregon Laws 2007, is amended to read:
  ' 701.063. (1) A license is valid for two years from the date
of issuance unless the license is revoked or suspended as set
forth in ORS 701.098.
  ' (2) A license may be renewed by submitting an application for
renewal on the prescribed form, providing any additional
information required, including evidence of completion of any
required education, and submitting the appropriate application
fee, as provided by Construction Contractors Board rule.
  ' (3) The board may vary the dates of license renewal by giving
to the licensee written notice of the renewal date assigned and
by making appropriate adjustments in the fee for the license
renewal application.
  ' (4) If a contractor applies for renewal not more than
 { - one year - }  { +  two years + } after the contractor's
license lapses, upon the contractor's compliance with the
requirements of subsection (2) of this section, the board may
renew the lapsed license. The board may designate the effective
date of renewal as the last date on which the contractor was
licensed.
  ' (5) A contractor may convert a license to inactive status if
the contractor is not engaged in work as a contractor. A
contractor having an inactive license is subject to board
licensing requirements and application fees, but is not subject
to the bonding requirement of ORS 701.068 or the insurance
requirement of ORS 701.073. A commercial general or commercial
specialty contractor having an inactive license is not subject to
the key employee continuing education requirements of ORS
701.124.  An inactive license is not considered a valid license
for purposes of offering to undertake construction work,
submitting a bid for construction work, obtaining a building
permit or performing construction work. A license may not be
placed or maintained in inactive status more than once during any
two-year licensing term.
  ' (6) The board shall issue a pocket-card certificate of
licensure to a contractor licensed under this chapter indicating
the type of license issued.
  '  { +  SECTION 6. + } ORS 701.098 is amended to read:
  ' 701.098. (1) The Construction Contractors Board may revoke,
suspend or refuse to issue or reissue a license and the board may
assess a civil penalty as provided in ORS 701.992 if the board
determines after notice and opportunity for hearing:
  ' (a) That the licensee or applicant has violated a provision
of ORS 701.026, 701.091, 701.114, 701.305, 701.320, 701.325 (1),
701.335 or 701.345 or a rule adopted under ORS 701.330 (4).
  ' (b) That the licensee has violated a rule or order of the
board.
  ' (c) That the licensee has knowingly assisted an unlicensed
person to act in violation of this chapter.
  ' (d) That a lien was filed on a structure under ORS 87.010 to
87.060 and 87.075 to 87.093 because the licensee or applicant
wrongfully failed to perform a contractual duty to pay money to
the person claiming the lien.
  ' (e) That the licensee has knowingly provided false
information to the board.
  ' (f) That the licensee has worked without a construction
permit where a permit is required and the work resulted in a
complaint being filed with the board under ORS 701.139. For
purposes of this paragraph, 'construction permit' includes a
building permit, electrical permit, mechanical permit or plumbing
permit.
  ' (g) That the number of licensed contractors working together
on the same task on the same job site, where one of the
contractors is licensed as exempt under ORS 701.035 (2)(b),
exceeded the following:
  ' (A) Two sole proprietors;
  ' (B) One partnership;
  ' (C) One corporation; or
  ' (D) One limited liability company.
  ' (h) Consistent with the provisions of ORS 670.280, that the
licensee or applicant, or an owner or officer of the licensee or
applicant has been convicted of one of the following crimes in
this state or an equivalent crime in another state:
  ' (A) Murder;
  ' (B) Assault in the first degree;
  ' (C) Kidnapping;
  ' (D) Rape, sodomy or unlawful sexual penetration;
  ' (E) Sexual abuse;
  ' (F) Arson in the first degree;
  ' (G) Robbery in the first degree;
  ' (H) Theft in the first degree; or
  ' (I) Theft by extortion.
  ' (i) That the licensee or applicant has not, within 90 days
after the date when payment was received from the public
contracting agency, or contractor in the case of a subcontractor,
made payment to any person for supplying labor or materials
contracted for with a public contract for a public improvement
plus the amount of interest due.
  ' (j) That the licensee or applicant has repeatedly reported
bad faith or false complaints of nonpayment against contractors
or subcontractors.
  ' (k) That the licensee or applicant has engaged in conduct as
a contractor that is dishonest or fraudulent and that the board
finds injurious to the welfare of the public.
  '  { +  (L) That the contractor has hired employees while
licensed as exempt under ORS 701.035. + }
  ' (2) The board may revoke, suspend or refuse to issue or
reissue a license if the board determines after notice and
opportunity for hearing that an applicant or licensee is unfit
for licensure based upon information submitted under ORS 701.046
or discovered by a board investigation under ORS 701.225.
  ' (3) The board may assess a civil penalty as provided in ORS
701.992 if the board determines after notice and opportunity for
hearing that any person has violated ORS 701.026 (1).
  ' (4)(a) The administrator of the board, in accordance with
administrative rules adopted by the board and after setting forth
specific reasons for the findings, may suspend or refuse to renew
a license without hearing in any case where the administrator
finds a serious danger to the public welfare, including but not
limited to:
  ' (A) Lack of a surety bond required by ORS 701.068;
  ' (B) Lack of liability insurance required by ORS 701.073;
  ' (C) Hiring employees while licensed as exempt under ORS
701.035;
  ' (D) Conduct as a construction contractor that is dishonest or
fraudulent; or
  ' (E) Failure to pay a construction debt.
  ' (b) If the licensee or applicant demands a hearing within 90
days after the date of notice to the licensee or applicant of the
suspension or refusal to renew, then a hearing must be granted to
the licensee or applicant as soon as practicable after the
demand, and the administrator shall issue, pursuant to the
hearing as required by ORS chapter 183, an order confirming,
altering or revoking the administrator's earlier order.
Notwithstanding ORS 670.325, a hearing need not be held where the
order of suspension or refusal to renew is accompanied by or is
pursuant to a citation for violation that is subject to judicial
determination in any court of this state, and the order by its
terms will terminate in case of final judgment in favor of the
licensee or applicant.
  ' (5)(a) In addition to all other remedies, if the board has
reason to believe that a person is engaging in an act, practice
or transaction that violates this chapter or a board rule, the
board may issue an order directing the person to cease the act or
to take corrective action.
  ' (b) The board shall mail a copy of an order issued under this
subsection to the person by first class mail with certificate of
mailing. The board shall include with the order a notice
informing the person of the right to request a hearing concerning
the order. The notice shall inform the person that any hearing
 
request must be received by the board no later than 21 days after
the date the order was mailed by the board.
  ' (c) If the board receives a timely request for a hearing
concerning an order issued under this subsection, the board shall
schedule the hearing no later than 30 days after receiving the
request. The board shall mail written notice of the hearing to
the person by first class mail with certificate of mailing no
later than seven days before the scheduled hearing date.
  ' (d) An order described in this subsection becomes final if
the person does not file a timely request for a hearing
concerning the order or fails to appear at the requested hearing
as scheduled.
  ' (e) The issuance of a board order under this subsection is
subject to ORS 183.413 to 183.497.
  ' (6) In addition to all other remedies, if it appears to the
board that a person has engaged in, or is engaging in, any act,
practice or transaction that violates the provisions of this
chapter, the board may direct the Attorney General or the
district attorney of the county in which the act, practice or
transaction occurs, to apply to the court for an injunction
restraining the person from violating the provisions of this
chapter. An injunction may not issue for failure to maintain the
list provided for in ORS 701.345, unless the court determines
that the failure is intentional.
  ' (7) A certified copy of the record of conviction shall be
conclusive evidence of a conviction under subsection (1)(h) of
this section.
  ' (8) If the board suspends or revokes the license of an
individual contractor or contractor business for a violation of
subsection (1)(g) of this section, the board may not restore or
reissue the license unless the individual contractor or a
responsible managing individual for the contractor business has
successfully completed the training and testing described in ORS
701.122.
  '  { +  SECTION 7. + } ORS 701.098, as amended by section 63,
chapter 836, Oregon Laws 2007, is amended to read:
  ' 701.098. (1) The Construction Contractors Board may revoke,
suspend or refuse to issue or reissue a license and the board may
assess a civil penalty as provided in ORS 701.992 if the board
determines after notice and opportunity for hearing:
  ' (a) That the licensee or applicant has violated a provision
of this chapter.
  ' (b) That the licensee has violated a rule or order of the
board.
  ' (c) That the licensee has knowingly assisted an unlicensed
person to act in violation of this chapter.
  ' (d) That the licensee has knowingly assisted a licensed
contractor to perform work for which the contractor is not
properly endorsed.
  ' (e) That a lien was filed on a structure under ORS 87.010 to
87.060 and 87.075 to 87.093 because the licensee or applicant
wrongfully failed to perform a contractual duty to pay money to
the person claiming the lien.
  ' (f) That the licensee has knowingly provided false
information to the board.
  ' (g) That the licensee has worked without a construction
permit where a permit is required and the work resulted in a
complaint being filed with the board under ORS 701.139. For
purposes of this paragraph, 'construction permit' includes a
building permit, electrical permit, mechanical permit or plumbing
permit.
  ' (h) That the number of licensed contractors working together
on the same task on the same job site, where one of the
contractors is classed as exempt under ORS 701.035 (2)(b),
exceeded the following:
  ' (A) Two sole proprietors;
  ' (B) One partnership;
  ' (C) One corporation; or
  ' (D) One limited liability company.
  ' (i) Consistent with the provisions of ORS 670.280, that the
licensee or applicant, or an owner or officer of the licensee or
applicant has been convicted of one of the following crimes in
this state or an equivalent crime in another state:
  ' (A) Murder;
  ' (B) Assault in the first degree;
  ' (C) Kidnapping;
  ' (D) Rape, sodomy or unlawful sexual penetration;
  ' (E) Sexual abuse;
  ' (F) Arson in the first degree;
  ' (G) Robbery in the first degree;
  ' (H) Theft in the first degree; or
  ' (I) Theft by extortion.
  ' (j) That the licensee or applicant has not, within 90 days
after the date when payment was received from the public
contracting agency, or contractor in the case of a subcontractor,
made payment to any person for supplying labor or materials
contracted for with a public contract for a public improvement
plus the amount of interest due.
  ' (k) That the licensee or applicant has repeatedly reported
bad faith or false complaints of nonpayment against contractors
or subcontractors.
  ' (L) That the licensee or applicant has engaged in conduct as
a contractor that is dishonest or fraudulent and that the board
finds injurious to the welfare of the public.
  '  { +  (m) That the contractor has hired employees while
licensed as exempt under ORS 701.035. + }
  ' (2) The board may revoke, suspend or refuse to issue or
reissue a license if the board determines after notice and
opportunity for hearing that an applicant or licensee is unfit
for licensure based upon information submitted under ORS 701.046
or discovered by a board investigation under ORS 701.225.
  ' (3) The board may assess a civil penalty as provided in ORS
701.992 if the board determines after notice and opportunity for
hearing that any person has violated ORS 701.021.
  ' (4)(a) The administrator of the board, in accordance with
administrative rules adopted by the board and after setting forth
specific reasons for the findings, may suspend or refuse to renew
a license without hearing in any case where the administrator
finds a serious danger to the public welfare, including but not
limited to:
  ' (A) Lack of a surety bond required by ORS 701.068;
  ' (B) Lack of liability insurance required by ORS 701.073;
  ' (C) Hiring employees while classed as exempt under ORS
701.035;
  ' (D) Conduct as a construction contractor that is dishonest or
fraudulent; or
  ' (E) Failure to pay a construction debt.
  ' (b) If the licensee or applicant demands a hearing within 90
days after the date of notice to the licensee or applicant of the
suspension or refusal to renew, then a hearing must be granted to
the licensee or applicant as soon as practicable after the
demand, and the administrator shall issue, pursuant to the
hearing as required by ORS chapter 183, an order confirming,
altering or revoking the administrator's earlier order.
Notwithstanding ORS 670.325, a hearing need not be held where the
order of suspension or refusal to renew is accompanied by or is
pursuant to a citation for violation that is subject to judicial
determination in any court of this state, and the order by its
terms will terminate in case of final judgment in favor of the
licensee or applicant.
  ' (5)(a) In addition to all other remedies, if the board has
reason to believe that a person is engaging in an act, practice
or transaction that violates this chapter or a board rule, the
board may issue an order directing the person to cease the act or
to take corrective action.
  ' (b) The board shall mail a copy of an order issued under this
subsection to the person by first class mail with certificate of
mailing. The board shall include with the order a notice
informing the person of the right to request a hearing concerning
the order. The notice shall inform the person that any hearing
request must be received by the board no later than 21 days after
the date the order was mailed by the board.
  ' (c) If the board receives a timely request for a hearing
concerning an order issued under this subsection, the board shall
schedule the hearing no later than 30 days after receiving the
request. The board shall mail written notice of the hearing to
the person by first class mail with certificate of mailing no
later than seven days before the scheduled hearing date.
  ' (d) An order described in this subsection becomes final if
the person does not file a timely request for a hearing
concerning the order or fails to appear at the requested hearing
as scheduled.
  ' (e) The issuance of a board order under this subsection is
subject to ORS 183.413 to 183.497.
  ' (6) In addition to all other remedies, if it appears to the
board that a person has engaged in, or is engaging in, any act,
practice or transaction that violates the provisions of this
chapter, the board may direct the Attorney General or the
district attorney of the county in which the act, practice or
transaction occurs, to apply to the court for an injunction
restraining the person from violating the provisions of this
chapter. An injunction may not issue for failure to maintain the
list provided for in ORS 701.345, unless the court determines
that the failure is intentional.
  ' (7) A certified copy of the record of conviction shall be
conclusive evidence of a conviction under subsection (1)(i) of
this section.
  ' (8) If the board suspends or revokes the license of an
individual contractor or contractor business for a violation of
subsection (1)(h) of this section, the board may not restore or
reissue the license unless the individual contractor or a
responsible managing individual for the contractor business has
successfully completed the training and testing described in ORS
701.122.
  '  { +  SECTION 8. + } ORS 701.305 is amended to read:
  ' 701.305. (1) A contractor may not perform work subject to
this section for an owner of a residential structure or
zero-lot-line dwelling without a written contract if the
aggregate contract price exceeds $2,000. If the price of a
contract was initially less than $2,000, but during the course of
performance the contract exceeds that amount, the contractor
shall mail or otherwise deliver a written contract to the owner
not later than five days after the contractor knows or should
reasonably know that the contract price will exceed $2,000.
Failure to have a written contract will not void the contract.
  ' (2) The Construction Contractors Board shall adopt rules that
require a contractor to use standard contractual terms in a
construction contract for which subsection (1) of this section
requires a written contract. The standard contractual terms shall
be clear, use words of common understanding and shall include but
need not be limited to:
  ' (a) A statement that the contractor is licensed by the board;
  ' (b) The name, license number, address and telephone number of
the contractor as shown on board records on the date the contract
is entered into;
  ' (c) An acknowledgment of a written offer of a warranty, if an
offer is required by ORS 701.320, and indication of the
acceptance or rejection of the offered warranty;
  '  { - (d) For a residential structure contract, a summary of
the notices required under ORS 87.093 or under rules adopted
under ORS 701.330 and 701.335 (2) on the contractor's bid
proposal; - }
  '  { - (e) - }  { +  (d)  + }Acknowledgment of the receipt of
the maintenance information required by the board under ORS
701.335; and
  '  { - (f) - }  { +  (e) + } An explanation of the property
owner's rights under the contract, including, but not limited to,
the ability to file a claim with the board and the existence of
any mediation or arbitration provision in the contract, set forth
in a conspicuous manner as defined by the board by rule.
  '  { +  SECTION 9. + }  { +  (1) The amendments to ORS 87.093
by section 1 of this 2009 Act apply to residential construction
or improvement contracts that a contractor enters into on or
after the effective date of this 2009 Act.
  ' (2) The amendments to ORS 701.063 by sections 4 and 5 of this
2009 Act apply to applications that the Construction Contractors
Board receives on or after the effective date of this 2009 Act
for renewal of a lapsed license.
  ' (3) The amendments to ORS 701.305 by section 8 of this 2009
Act apply to written contracts delivered to an owner on or after
the effective date of this 2009 Act. + } ' .
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