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Introduced Version Senate Bill 492 History

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Senate Bill No. 492

(By Senators Yost and Klempa)

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[Introduced February 2, 2012; referred to the Committee on the Judiciary.]

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A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new section, designated §21-11-21; and to amend said code by adding thereto a new section, designated §31-17-21, all relating to requiring residential construction projects to be bonded; setting forth a contractor’s responsibilities; and requiring a lender making a loan for residential construction services to be financially responsible for payment to the contractor and any subcontractors who provide those services and to suppliers of materials used in the construction.

Be it enacted by the Legislature of West Virginia:

    That the Code of West Virginia, 1931, as amended, be amended by adding thereto a new section, designated §21-11-21; and that said code be amended by adding thereto a new section, designated §31-17-21, all to read as follows:

CHAPTER 21. LABOR.

ARTICLE 11. WEST VIRGINIA CONTRACTOR LICENSING ACT.

§21-11-21. Residential construction; contractor’s                      responsibilities.

    Contractors who erect, build, construct, alter, remove or repair any residential building or other residential structure, or other improvement appurtenant to that building or other structure, shall obtain for length of the project a surety bond for the total value of the project. The contractor shall, before beginning a project, provide a copy of that bond to the property owner, potential subcontractors, potential suppliers, any lender who has made a loan on the project and the commissioner. After work has begun on the project the contractor shall provide monthly reports to the property owner, subcontractors, suppliers, lenders and the commissioner on who, and in what amounts, were paid during that month on the project.

CHAPTER 31. CORPORATIONS.

ARTICLE 17. WEST VIRGINIA RESIDENTIAL MORTGAGE LENDER, BROKER AND SERVICER ACT.

§31-17-21. Residential construction loans; lender responsibility.

    A lender who makes a loan to erect, build, construct, alter, remove or repair any building or other structure, or other improvement appurtenant to that building or other structure, or who alters or improves the real property where the structure stands, or from which it may have been removed, or who provides services for any of the foregoing, shall be responsible for the timely payment to the contractor and any subcontractors who perform the construction or removal services and to any suppliers of materials or other goods used in the performance of those services.



    NOTE: The purpose of this bill is to require residential construction projects to be bonded. The bill sets forth a contractor’s responsibilities. The bill requires a lender making a loan for residential construction services to be financially responsible for payment to the contractor and any subcontractors who provide those services and to suppliers of materials used in the construction.



    These sections are new; therefore, strike-throughs and underscoring have been omitted.

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