Scott vetoes contractor registration bill as lawmakers urge him to sign it

Lawmakers, state office holders, homeowners and builders got some unwelcome news Thursday during a news conference when they were told Gov. Phil Scott had vetoed the bill they were urging him to sign.

The conference was led by Vt. Senate President Pro Tem Becca Balint, D-Windham, over H.157, "an act relating to registration of construction contractors," which passed the House and Senate in late January. It would have created a registry for building contractors in Vermont, required them to carry and show proof of liability insurance, and have written contracts for jobs over $3,500.

Near the end of the roughly hour-long conference, a WCAX reporter informed the panel of an email from Scott announcing his veto of the bill. Tina Desmarais, a homeowner from Plainfield, and Rebecca Saunders, a homeowner from Putney, who'd spoken about their troubles with building contractors, shook their heads and threw up their hands as the reporter summarized the email.

The conference was held online.

"The fact is, the findings of the Legislature in support of this bill are flawed," Scott stated in his email. "This bill has the potential to undermine and weaken a large number of Vermont's small businesses — small, local residential contractors — at a time when we all agree we must prioritize new and revitalized housing."

Scott claims the bill favors larger, established businesses at the expense of smaller ones by "imposing, by law, specific contract and insurance requirements that many of the smaller businesses will not be able to meet," he wrote. "Such specific requirements are rarely, if ever imposed on other professions. Ultimately, these provisions harm small businesses — which could lead to closures — and they harm consumers through higher costs and fewer options for making needed repairs."

Sen. Michael Sirotkin, D-Chittenden, chair of the Senate Committee on Economic Development, Housing and General Affairs, said the Legislature would have to seriously consider an override of the veto, or tweaking some other legislation to address the governor's concerns. He said Scott's objections to the bill have been heard before and Sirotkin believes they are misplaced.

"I'm disappointed that the governor couldn't find a way to support this," said Secretary of State Jim Condos. "I think as Sen. Sirotkin said, I think his objections are misplaced."

Condos said earlier in the conference that the bill is far from being over-burdensome.

"What's proposed here in H.127 is a light-touch registration, it is not certification or licensing, it has minimal requirements; those three requirements are registration, liability insurance and a written contract for above $3,500," he said. "We're even going to post a template contract on our website so that any contractor that needs it will be able to find one."

He said not passing this bill only helps "fly-by-night" and irresponsible contractors who prey on Vermonters and cost them money.

Desmarais said in 2019 she began talking publicly about her experience with a contractor who got $11,000 from her to do roofing work that he never did. She said he did this to others as well. She was told she had little legal recourse in the matter.

The man who defrauded her, Ryan E. Kimball, 34, of St. Johnsbury, was sentenced in 2020 to serve three to six years in jail, all suspended except for 18 months, after he pleaded guilty to two felony counts of home improvement fraud, along with a misdemeanor charge of violating a court order. He's also put on probation for eight years.

"He was released in July under conditions that he repay his victims," said Desmarais. "He has not paid a penny. So there are no teeth in the law. There is no way for us who've been victimized to get satisfaction and to stop the madness."

She said that while she's had good experiences with building contractors, she's had bad ones, as well, and believes a registry would lead to things like this happening less often.

Some of the bill's supporters were contractors who said the registry would help them do business.

Joe Boutin, a builder in Sunderland, said he believes having a registry would help young builders without a track record to get their start. It takes years to gain the education and experience needed to be a good contractor and right now someone who obtains those things has little in the way of papers to prove it.

"Vermont is still seen as the Wild West of New England when it comes to the building industry," said Jim Bradley, a past president of the Vermont Builders and Remodelers Association. "We are one of the few states in the nation without some type of contractor registry or licensing requirement for the contracting industry."

Throughout the past two years, Attorney General T.J. Donovan has received more than 200 home improvement complaints amounting to claims of about $2 million. He said he believes the reality is many go unreported.

"This is real money for folks, and when you talk about creating just this light-touch registry, it's very simple, you're just giving Vermonters information so they can make an informed choice," he said.

Scott wrote in his letter that a registry isn't needed for people to find reputable contractors and there are other avenues for holding them accountable.

"One can find directories maintained by trades associations, as well as commercial listings, social media, consumer sites, references and, of course, word of mouth," he wrote. "Importantly, there are existing avenues for determining and adjudicating complaints already, as well as an existing Home Improvement Fraud Registry. Current law clearly authorizes the attorney general to pursue both civil and criminal complaints against contractors for unfair or deceptive acts or practices."

According to the governor, the Legislature has admitted that the registration wouldn't assure a contractor's competence.

"Given this concession, we should not risk the economic harm of this legislation when we already have tools in the toolbox to protect consumers and perhaps those tools should be sharpened," Scott stated.

keith.whitcomb @rutlandherald.com