EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

1-1 Section 1. Chapter 624 of NRS is hereby amended by adding thereto

1-7 correct the violation, the governing body shall, not later than 10 days

2-1 after making that determination, notify the board in writing of its

2-2 determination.

2-3 2. Upon receipt of a notice required pursuant to subsection 1, the

2-4 board shall conduct an investigation to determine whether any action

2-5 may be taken against the contractor.

2-6 3. A member of the board or a person authorized by the board may

2-7 enter the site of a construction project or any other private property

2-8 during regular business hours to conduct an investigation or to carry out

2-9 its duties pursuant to the provisions of this chapter.

2-10 Sec. 3. 1. The board shall, by regulation, establish a program to

2-11 provide continuing education for licensed contractors.

2-12 2. The regulations adopted pursuant to the provisions of subsection 1

2-13 must require each licensed contractor to comply with the requirements

2-14 for continuing education as a prerequisite for the renewal of his license

2-15 by the board.

2-16 Sec. 4. 1. Before issuing a license to an applicant who will engage

2-17 in residential construction or renewing the license of a contractor who

2-18 engages in residential construction, the board shall require the applicant

2-19 or contractor to establish his financial responsibility by submitting to the

2-20 board:

2-21 (a) A financial statement prepared by a certified public accountant

2-22 who is licensed pursuant to the provisions of chapter 628 of NRS; and

2-23 (b) A statement setting forth:

2-24 (1) The number of building permits issued to and construction

2-25 projects completed by the contractor for the immediately preceding year;

2-26 and

2-27 (2) Any other information required by the board.

2-28 The statement submitted pursuant to this paragraph must be provided on

2-29 a form approved by the board.

2-30 2. In addition to the requirements set forth in subsection 1, the board

2-31 may require a contractor who engages in residential construction to

2-32 establish his financial responsibility at any time.

2-33 Sec. 5. NRS 624.260 is hereby amended to read as follows:

2-34 624.260 1. The board shall require an applicant or a licensee to show

2-42 appearance of his responsible managing employee.

3-1 (b) If a copartnership, a corporation or any other combination or

3-2 organization, it may qualify by the appearance of the responsible managing

3-3 officer or member of the personnel of the applicant firm.

3-4 3. The natural person qualifying on behalf of another natural person or

3-5 firm under paragraphs (a) and (b) of subsection 2 must prove that he is a

3-6 bona fide member or employee of that person or firm and when his

3-7 principal or employer is actively engaged as a contractor shall exercise

3-8 authority in connection with his principal or employer’s contracting

3-9 business in the following manner:

3-10 (a) To make technical and administrative decisions;

3-11 (b) To hire, superintend, promote, transfer, lay off, discipline or

3-12 discharge other employees and to direct them, either by himself or through

3-13 others, or effectively to recommend such action on behalf of his principal

3-14 or employer; and

3-15 (c) To devote himself solely to his principal or employer’s business and

3-16 not to take any other employment which would conflict with his duties

3-17 under this subsection.

3-18 4. A natural person may not qualify on behalf of another for more than

3-19 one active license unless:

3-20 (a) One person owns at least 25 percent of each licensee for which he

3-21 qualifies; or

3-22 (b) One licensee owns at least 25 percent of the other licensee.

3-23 Sec. 6. NRS 624.263 is hereby amended to read as follows:

3-24 624.263 1. For the purposes of this chapter, financial responsibility

3-43 (a) Net worth.

4-1 (b) Amount of liquid assets.

4-2 (c) Prior payment and credit records.

4-3 (d) Previous business experience.

4-4 (e) Prior and pending lawsuits.

4-5 (f) Prior and pending liens.

4-6 (g) Adverse judgments.

4-7 (h) Conviction of a felony or crime involving moral turpitude.

4-8 (i) Prior suspension or revocation of a contractor’s license in Nevada or

4-9 elsewhere.

4-10 (j) An adjudication of bankruptcy or any other proceeding under the

4-11 federal bankruptcy laws, including:

4-12 (1) A composition, arrangement or reorganization proceeding;

4-13 (2) The appointment of a receiver of the property of the applicant or

4-14 contractor or any officer, director, associate or partner thereof under the

4-15 laws of this state or the United States; or

4-16 (3) The making of an assignment for the benefit of creditors.

4-17 (k) Form of business organization (corporate or otherwise).

4-18 (l) Information obtained from confidential financial references and

4-19 credit reports.

4-20 (m) Reputation for honesty and integrity of the applicant or contractor

4-21 or any officer, director, associate or partner thereof.

4-22 [3.] 4. A licensed contractor shall, as soon as it is reasonably

4-23 practicable, notify the board in writing upon the filing of a petition or

4-24 application relating to the contractor that initiates any proceeding,

4-25 appointment or assignment set forth in paragraph (j) of subsection [2.] 3.

4-26 The written notice must be accompanied by:

4-27 (a) A copy of the petition or application filed with the court; and

4-28 (b) A copy of any order of the court which is relevant to the financial

4-29 responsibility of the contractor, including any order appointing a trustee,

4-30 receiver or assignee.

4-31 5. The applicant or licensee may establish his financial responsibility

4-32 independently of and without reliance upon the assets or guarantees of

4-33 his officers, directors or stockholders. The board may inquire into and

4-34 consider the financial responsibility of the officers and directors as a

4-35 criterion in determining financial responsibility.

4-36 Sec. 7. NRS 624.270 is hereby amended to read as follows:

4-37 624.270 1. Before issuing a contractor’s license to any applicant, the

4-43 as provided in this section.

5-1 2. Before granting renewal of a contractor’s license to any applicant,

5-2 the board shall require that the applicant file with the board satisfactory

5-3 evidence that his surety bond or cash deposit is in full force . [, unless the

5-4 applicant has been relieved of the requirement as provided in this section.

5-5 3. Failure]

5-6 3. The failure of an applicant or licensee to file or maintain in full

5-7 force the required bond or to establish the required cash deposit constitutes

5-8 cause for the board to deny, revoke, suspend or refuse to renew a license.

5-9 4. Except as otherwise provided in subsection 6, the amount of each

5-10 bond or cash deposit required by this section must be fixed by the board

5-11 with reference to the contractor’s financial and professional responsibility

5-12 and the magnitude of his operations, but must be not less than $1,000 or

5-13 more than $100,000. The bond must be continuous in form and must be

5-14 conditioned that the total aggregate liability of the surety for all claims is

5-15 limited to the face amount of the bond irrespective of the number of years

5-16 the bond is in force. The board may increase or reduce the amount of any

5-17 bond or cash deposit if evidence supporting such a change in the amount is

5-18 presented to the board at the time application is made for renewal of a

5-19 license or at any hearing conducted pursuant to NRS 624.310. Unless

5-20 released earlier pursuant to subsection 5, any cash deposit may be

5-21 withdrawn 2 years after termination of the license in connection with which

5-22 it was established, or 2 years after completion of all work authorized by the

5-23 board after termination of the license, whichever occurs later, if there is no

5-24 outstanding claim against it.

5-25 5. After a licensee has acted in the capacity of a licensed contractor in

5-26 the State of Nevada for not less than [5] 10 consecutive years, and if no

5-27 substantiated complaints have been filed with the board in the

5-28 immediately preceding 5 years, the board may relieve the licensee of the

5-29 requirement of filing a bond or establishing a cash deposit if evidence

5-30 supporting such relief is presented to the board. The board may at any time

5-31 thereafter require the licensee to file a new bond or establish a new cash

5-32 deposit as provided in subsection 4 if evidence is presented to the board

5-33 supporting this requirement or, pursuant to subsection 6, after notification

5-34 of a final written decision by the labor commissioner. If a licensee is

5-35 relieved of the requirement of establishing a cash deposit, the deposit may

5-36 be withdrawn 2 years after such relief is granted, if there is no outstanding

5-37 claim against it.

5-38 6. If the board is notified by the labor commissioner pursuant to NRS

5-39 607.165 that three substantiated claims for wages have been filed against a

5-40 contractor within a 2-year period, the board shall require the contractor to

5-41 file a bond or establish a cash deposit in an amount fixed by the board. The

5-42 contractor shall maintain the bond or cash deposit for the period required

5-43 by the board.

6-1 7. As used in this section, "substantiated claims for wages" has the

6-2 meaning ascribed to it in NRS 607.165.

6-3 Sec. 8. NRS 624.283 is hereby amended to read as follows:

6-4 624.283 1. Each license issued under the provisions of this chapter

6-34 original contractor’s license.

6-35 Sec. 9. NRS 624.300 is hereby amended to read as follows:

6-36 624.300 1. Except as otherwise provided in subsection 6, the board

6-41 (d) Impose an administrative fine of not more than $10,000;

7-1 (e) Order the licensee to take action to correct a condition resulting from

7-2 an act which constitutes a cause for disciplinary action, at the licensee’s

7-3 cost; or

7-4 (f) Reprimand or take other less severe disciplinary action, including,

7-5 without limitation, increasing the amount of the surety bond or cash deposit

7-6 of the licensee,

7-7 if the licensee commits any act which constitutes a cause for disciplinary

7-8 action.

7-9 2. The board may, in addition to any other conditions for reinstating

7-10 or renewing the license, require the licensee to file with the board a bond

7-11 in an amount fixed by the board based on the nature of the violation. The

7-12 bond is in addition to, may not be combined with, and does not replace

7-13 any other bond required pursuant to the provisions of this chapter. The

7-14 contractor shall maintain the bond for at least 2 years, or for a longer

7-15 period, as determined by the board.

7-16 3. If the board suspends or revokes the license of a contractor for

7-17 failure to establish financial responsibility, the board may, in addition to

7-18 any other conditions for reinstating or renewing the license, require that

7-19 each contract undertaken by the licensee for a period to be designated by

7-20 the board, not to exceed 12 months, be separately covered by a bond or

7-21 bonds approved by the board and conditioned upon the performance of and

7-22 the payment of labor and materials required by the contract.

7-23 [3.] 4. If a licensee commits a fraudulent act which is a cause for

7-24 disciplinary action under NRS 624.3016, the correction of any condition

7-25 resulting from the act does not preclude the board from taking disciplinary

7-26 action.

7-27 [4.] 5. If the board finds that a licensee has engaged in repeated acts

7-28 that would be cause for disciplinary action, the correction of any resulting

7-29 conditions does not preclude the board from taking disciplinary action

7-30 pursuant to this section.

7-31 [5.] 6. The expiration of a license by operation of law or by order or

7-32 decision of the board or a court, or the voluntary surrender of a license by a

7-33 licensee, does not deprive the board of jurisdiction to proceed with any

7-34 investigation of, or action or disciplinary proceeding against, the licensee

7-35 or to render a decision suspending or revoking the license.

7-36 [6.] 7. The board shall not take any disciplinary action pursuant to this

7-37 section regarding a constructional defect, as that term is defined in NRS

7-38 40.615, during the period in which any claim arising out of that defect is

7-39 being settled, mediated or otherwise resolved pursuant to NRS 40.600 to

7-40 40.695, inclusive, unless the disciplinary action is necessary to protect the

7-41 public health or safety.

8-1 [7.] 8. If discipline is imposed pursuant to this section, the costs of the

8-2 proceeding, including investigative costs and attorney’s fees, may be

8-3 recovered by the board.

8-4 Sec. 10. NRS 624.3013 is hereby amended to read as follows:

8-5 624.3013 The following acts, among others, constitute cause for

8-22 chapter or the regulations of the board.

8-23 Sec. 11. NRS 624.321 is hereby amended to read as follows:

8-24 624.321 A [general building] contractor shall provide in writing to the

8-39 [.] ; and

8-40 (c) The availability of any warranty and any information related to

8-41 such a warranty.

9-1 Sec. 12. NRS 624.330 is hereby amended to read as follows:

9-2 624.330 [This chapter does] The provisions of this chapter do not

9-43 property.

10-1 8. The construction, alteration, improvement or repair financed in

10-2 whole or in part by the Federal Government and [carried on] conducted

10-3 within the limits and boundaries of a site or reservation, the title of which

10-4 rests in the Federal Government.

10-5 9. An owner of property, the primary use of which is as an agricultural

10-6 or farming enterprise, building or improving a structure on the property for

10-7 his [own] use or occupancy and not intended for sale or lease.

10-8 10. An owner of property who builds or improves a structure upon his

10-9 property and who contracts solely with a managing contractor licensed

10-10 pursuant to the provisions of this chapter for the building or improvement,

10-11 if the owner is and remains financially responsible for the building or

10-12 improving of all buildings and structures built by the owner upon his

10-13 property pursuant to the exemption [of] specified in this subsection.

10-14 Sec. 13. NRS 624.360 is hereby amended to read as follows:

10-15 624.360 1. Any person violating [any of] the provisions of this

10-37 pursuant to the provisions of NRS 624.300 to 624.305, inclusive.

10-38 Sec. 14. Chapter 40 of NRS is hereby amended by adding thereto a

10-39 new section to read as follows:

10-40 1. Except as otherwise provided in NRS 116.4113 and 116.4114,

10-41 each contractor who develops or constructs a new residence may, if the

10-42 residence is sold to a person other than the contractor, provide a written

10-43 homeowner’s warranty for that residence. The warranty must state that

11-1 the contractor will repair or replace, without cost to the person to whom

11-2 the residence is sold:

11-3 (a) Any constructional defect in the residence, other than a defect

11-4 specified in paragraph (b), occurring within 1 year after a certificate of

11-5 occupancy is issued for the residence; and

11-6 (b) Any defect in a structural component of the residence occurring

11-7 within 10 years after a certificate of occupancy is issued for the

11-8 residence. As used in this paragraph, "structural component" means the

11-9 foundation, floors, walls, roof trusses or rafters of a residence.

11-10 2. A sale or other conveyance of a residence for which a

11-11 homeowner’s warranty is provided pursuant to the provisions of this

11-12 section does not extinguish, modify or limit that warranty.

11-13 Sec. 15. NRS 40.600 is hereby amended to read as follows:

11-14 40.600 As used in NRS 40.600 to 40.695, inclusive, and section 14 of

11-17 those sections.

11-18 Sec. 16. Chapter 278 of NRS is hereby amended by adding thereto a

11-19 new section to read as follows:

11-20 1. In a county whose population is 100,000 or more, each certificate

11-21 of occupancy issued for a single-family residence must be issued in

11-22 substantially the following form:

11-23 CERTIFICATE OF RESIDENTIAL OCCUPANCY

11-24 This certificate of occupancy does not create an express or implied

11-25 warranty or guarantee.

11-26 Address: Permit Number:

11-27

11-28

11-29 Name of Builder: Date of Final Inspection:

11-30 Owner-Builder: o Yes o No

11-31 Name of Building

11-32 Inspector:

11-33 This building is deemed to be in substantial compliance with fire, safety

11-34 and structural provisions of the adopted building codes. Records

11-35 concerning the construction of this building are on file with the building

11-36 department for 12 years after the date that the records are filed with the

11-37 building department.

12-1 2. A certificate of occupancy issued pursuant to the provisions of

12-2 subsection 1 must be issued to the person to whom the building permit

12-3 for the single-family residence was issued.

12-4 3. If the single-family residence for which the certificate of

12-5 occupancy is issued pursuant to subsection 1 is sold, the owner of the

12-6 single-family residence shall provide a copy of the certificate of

12-7 occupancy to the purchaser of the residence. The copy must be provided

12-8 before the close of escrow for the residence.

12-9 4. The building department of a county whose population is 100,000

12-10 or more shall maintain on file the records concerning a building for

12-11 which a certificate of occupancy is issued pursuant to subsection 1 for at

12-12 least 12 years after the date those records are filed with the building

12-13 department.

12-14 Sec. 17. The amendatory provisions of this act do not apply to

12-15 offenses that are committed before October 1, 1999.