IdahoContractor.com :: Our View On Harmful Business Regulations Via Contractor Licensing
Does it make us more professional to espouse views that increase regulations and the cost of construction? Or don't you agree, contractors owe an obligation to the consumer to fight needless regulation and do our best to help control the cost of housing for you and your children? Then please read on . . .
Remember: quality and licensing are not related!
- Contractor registration is a straw man:
- It regulates the most basic element of entrepreneurship -- the ability to freely market the labor of one’s hands;
- This will make criminals of those who do not agree with the regulation of the state (and we always need more jails).
- It establishes another bureaucracy that will increase the burden upon the contractor with fees and increasing regulations;
- This increases the cost of housing for the homebuyer.
- It will increase the cost to local building departments which will have to meet State requirements and procedures for registration verification;
- This will increase the cost of permits and property taxes.
- It will reduce Idaho’s market share of affordable housing as the gap between costs in Washington State and Idaho diminish;
- This will reduce jobs and revenue in the State of Idaho.
- It will make it difficult for young contractors trying to enter the market;
- This will reduce or eliminate competition which means higher costs to the consumer and taxpayer.
- It provides a false sense of security to the consumer while providing no relief or accountability;
- This will give empire-builders more power to micro-manage commerce, making more-and-more rules while extracting more-and-more fees.
It is a common notion in our lost republic to use the tool of civil government to solve all of our problems. The easiest solution to a perceived crisis is to call upon our lawmakers and promote another public law. Most these problems are not real but are stirred up by special interest groups with the aide of the news media.
At the time of this revised writing [March 2004], the most recent contractor registration bill is promoted as a consumer protection measure but nobody can explain how it protects the consumer! According to the Coeur d’Alene Press article (Contractor Bill Clears Senate, 27 Feb 2004), Senator Dick Compton recommends even if this bill becomes law “people should check references when selecting a contractor.” This bill does nothing but provide people with a false sense of security.
“Buyer Beware” has been and always will be the best consumer protection. Any legitimate contractor will be willing to provide proof of insurance and references to prospective clients. This bill adds nothing to this and there is no bill capable of changing or perfecting the rotten character of some people; no matter what profession.
The best consumer advocacy is to provide for their prosperity. Competition benefits the consumer more than a toothless “watchdog.” If you register contractors, you reduce competition and you increase the cost of housing. Licensing, or registration, has not eliminated or even reduced contractor scams in any State. The State will license anyone who meets the qualifications set forth in the statutes. In licensed States, there are licensed rip-offs.
Not only do bonding or certification requirements do nothing to stave off bankruptcy or scams, but we build a giant bureaucracy upon the premise that it does so. Certainly, this bureaucracy will start small and have a minor budget but you know that the nature of bureaucracy is to build empires. As the burden of the bureaucracy increases, the cost of construction will increase, the people will demand more control of an industry going out of control, the bureaucracy will increase, the burden increase, the cost of construction will increase . . . and on, and on. In time, Contractor Registration will have multi-storied buildings with skywalled atriums and mezzanines and three hundred thousand dollar fish tanks, filled with armies of bureaucrats with benefits and pensions that far exceed the hopes and dreams of most small-time contractors and we will be wondering how a starter home came to be $250,000 so fast.
- Two sidenotes on the previous paragraph:
- Idaho is facing huge shortfalls in meeting the budget this year and our elected officials are discussing adding new bureaucracies to siphon even more taxpayer money;
- North Idaho, like it or not, is the bedroom, or suburb of Spokane. The only reason our housing market is so strong is because of the regulations in Washington State. The Growth Management Act in Washington State adds almost twenty-five percent more to the cost of housing than the regulations in Idaho. Idaho is very attractive to the starter-home buyer. If we increase our regulations and our fees to meet Washington’s, our market will diminish, if not disappear. Then we will lose jobs and tax base.
You only get what you pay for: If you hire just any low-bidder to work on your house, it will cost you. If you want civil government to protect you from your own laziness or lack of common sense, it will cost you. Don’t be fooled: every little regulation, every little fee, every little tax and every little report and piece of paper add to the increasing cost of housing.
Don’t be deceived by industry experts who try to convince you this is a good bill and try to convince you there is unity in the construction industry. When I belonged to the North Idaho Building Contractors Association, we were split wide open. It was the leaders who were promoting this (and most of them were from California) and it is their desire to squeeze out the competition to increase the cost of their services and the value of their assets. Who will protect us from that? – and they do not intend to stop there. They will promote Conservation Easements, Growth Management ordinances, Development Rights Transfers, stricter building codes and other tools that will squeeze out smaller contractors and increase the value of their properties – at the expense of the consumer and homebuyer. To oppose contractor registration is to protect us from a greater scam than the nickel and dime artists this bill is intended for.
This bill will squeeze out the little guys and hinder other “little guys” from entering the field. I remember well, when I started contracting in 1975 (in the Seattle area) how hard it was to obtain and maintain my license while trying to build (or survive) my small business. And through the years, I have watched scammers come and go in a State (Washington) that was strict upon registration – with no relief to the consumer.
- Two sidenotes on the paragraphs above:
- For most residential jobs and small contractor can perform the work much cheaper than a larger contractor who has to pay staff. If you squeeze out the small contractor, you will be forced to do business with the larger, more expensive contractor.
- Three or four years ago, while applying for a building permit in one of the larger cities of Eastern Washington, the clerk went into a soapbox speech against the Washington State contractors’ registration. She was angry at the State because she had to do a mountain of paperwork to prove the city was in compliance with State regulations monitoring the relationship between permit activities and licensing verification. Then she listed several examples of people who were being ripped off by local, registered contractors and the State’s refusal to address the homeowners’ claims.
Finally, my friend, consider the premise that we should be free to conduct our affairs and business with each other with minimal government interference. The fact that some businesses are already regulated and licensed is no justification that we should license or register the rest and especially the most elemental of all occupations – contracting. Compare the words of the Declaration of Independence to the words of the most recent contractor registration bill:
Therefore, I respectfully ask you to contact your State Representatives and ask them to oppose Contractor Registration.
Sincerely,Dean Isaacson; Idaho contractor and Washington registered.
