Dr. Swann Debates Bill 12 – New Home Buyer Protection Amendment Act, 2017 (Committee of the Whole) – 17 May 2017

Taken from the Alberta Hansard for Wednesday, May 17, 2017.

Bill 12 – New Home Buyer Protection Amendment Act, 2017 (Committee of the Whole)

Dr. Swann: Dr. Swann: Thank you, Madam Chair. I have an amendment to suggest and will circulate that and await your approval.

The Chair: This will be known as amendment A3. Go ahead, hon. member.

Dr. Swann: Thanks, Madam Chair. This is an excellent bill that I think all Albertans will welcome. My amendment seeks to simply add a little more transparency around the background of specific builders and suggests that the public has a right to know a little more than is currently required of builders and their past history.

The New Home Buyer Protection Amendment Act, 2017, would be amended by striking out section 12 and substituting the following:

12 Section 9 is repealed, and the following is substituted:

Registry

9(1) The Registrar shall establish and maintain a registry that must include information on

(a) licences applied for, issued, renewed, suspended, cancelled or reinstated under this Act,

(b) authorizations applied for, issued, suspended or cancelled under this Act,

(c) exemptions applied for or issued under this Act,

(d) claims that have been made under a home warranty insurance contract or under Part 1 of this Act,

(e) legal proceedings against a residential builder for structural defects, defects in materials or labour or any deficiency related to the construction of a new home,

(f) new homes built or under construction by residential builders, including details of the home warranty insurance contracts covering the new homes,

(g) new homes built or under construction by owner builders, including details of the home warranty insurance contracts covering the new homes, if applicable,

(h) persons in respect of whom administrative penalties have been imposed or compliance orders have been issued under this Act,

(i) persons convicted of an offence under this Act, and

(j) any other prescribed information.

(2) A warranty provider, residential builder or owner builder must notify the Registrar when a claim is made under a home warranty insurance contract or Part 1 of this Act within 30 days after the claim is made.

(3) The Registrar shall establish and maintain an online registry accessible to the public that consists of the information in the registry, and may publicly disclose that information.

Madam Chair, it is clear that we want more public access to information. This is simply going to add to the access the public has to information about a particular builder, their history, any concerns that have been found to be warranted relating to improper or inadequate building standards, any previous actions to withhold approval to this particular builder. It will simply give public access to the information that now is not included on the current website, to allow the public themselves to make their own judgments about whether the past history of this builder is acceptable or not. I think it will simply add to the confidence that people will have in this important new legislation and give them access to more information that relates to specific builders and their past history.

Thank you, Madam Chair.

The Chair: The hon. Member for Banff-Cochrane.

Mr. Westhead: Thank you very much, Madam Chair. I’d like to thank the member for putting forward a thoughtful amendment. You know, we’ve just received this, so it might take some time for us to consider this. I would strongly encourage the member that if it’s available to him in the future, if we can have a little more notice so that we have a bit of time to understand the ramifications of the proposed amendment. I know that the member certainly brought this forward in good faith and is attempting to improve the bill.

I guess, as we’re considering this, I have some questions on whether or not the information that is being requested here could potentially be obtained elsewhere in the bill. I just want to make sure that this information isn’t redundant and hasn’t been captured elsewhere. You know, I’m just wondering. Reading through the section that is relevant here, it currently reads:

Section 9(1)(a) is repealed and the following is substituted:

(a) licences applied for, issued, renewed, suspended, cancelled or reinstated under this Act,

(a.1) authorizations applied for, issued, suspended or cancelled under this Act,

(a.2) exemptions applied for or issued under this Act.

The amendment contemplates adding quite a bit of additional information. You know, my question to the member is: does he feel that what’s currently in there is not accurately captured? What specifically is the reason for these additional items?

Dr. Swann: Well, indeed, this gives more information to the public. This may be knowledge that the ministry might have, but in the current bill legal proceedings that have been raised against a builder in the past aren’t necessarily included, past convictions. I think consumers have a right to know what’s gone on in the past, not just what’s happening in the current state of affairs. This would add more information, more data, more accountability to this particular bill. It’s a question, I guess, of just how much transparency is reasonable. For the homebuyer, I think, the more the better, and looking at a builder’s past history and previous convictions, to me, should be part and parcel of what is available to the consumer.

Thanks, Madam Chair.

Mr. Westhead: Thank you for the additional information. I suppose a question that came up for me in the explanation was: would this information be retroactive, or do you contemplate this being once the bill comes into force, that this would be information that’s kept moving forward from that point in time? Or would this be retrospectively looking at future convictions, future exemptions? The information you’re seeking: would it be retroactive, or would it be forward looking?

Dr. Swann: I think that, as indicated in the details of the amendment, this should include past convictions and should be part of the record indeed if there has been a violation and a conviction around inadequate building standards or misrepresentation of building quality.

Thanks, Madam Chair.

The Chair: Olds-Didsbury-Three Hills.

Mr. Cooper: Thank you, Madam Chair. I just have a couple of quick questions for my colleague from the Liberal caucus with respect to the registry and if he feels that some of the additional requirements in the registry will have any significant impact on costs. We’ve seen in the past other Liberal organizations with respect to registries and ballooning costs, and I’m just wondering if that is a possibility with the additional requirements in this registry.

Dr. Swann: Well, Madam Chair, reliable information does cost a little more. There’s no question that if you want more information and you want more reliable information and you want more disclosure, more accountability of inadequate builders, it’s going to cost a little more. It takes more time, more searching, more uploading of information. Presumably, we would better protect consumers.

Mr. Cooper: In all seriousness, though, have you given any consideration to what those costs might be with respect to the additional information? I know I was joking around about the gun registry there, but have you considered what the additional costs might be? Perhaps the government can provide some comment around whether or not they think that the additional associated costs to the builder would be able to cover the additional pieces of information that you are also trying to include in the registration.

I do agree that having more information available to those that would like to seek it when making such an important decision is, obviously, an important goal to try to achieve. The legislation, hopefully, balances the amount of red tape associated with the bill, allowing industry to also act in a way that is helpful to industry, helpful to the consumer and to finding that balance. I don’t know if the government could respond with respect to the total costs and how this may affect that, or perhaps you’ve considered it. In addition to adding regulations to builders already, does it tilt the balance, or do you think the balance has been struck appropriately?

Dr. Swann: Well, fair question. I guess that what I would say is that this new bill is going to add costs to builders. It’s going to require them to upload more information about their past, especially about inadequacies in their past and violations in their past building practices. Once that is done, there would be no additional expense because the foundation has been set and they simply add each year any concerns that have been raised or found inadequate in their building.

I don’t see it being a significant increase – some increase but not a significant increase – in the initial requirements based on this new bill. The bill itself is going to require significant new information, a new website, new reporting practices and standards. Yes, it’s going to cost more but not significantly more than is currently being asked for.

The Chair: Edmonton-McClung.

Mr. Dach: Thank you, Madam Chair. I just want to rise as well and make a comment, a couple of questions to the hon. member who’s proposing the amendment because it does give me some concern. I’m just wondering if he has given consideration to the consequences of some of the measures that he’s proposing, particularly in terms of gathering some of the information that he’s proposing be registered. Some of that is readily available and could be verified quite easily. What I believe the hon. member is asking builders to do is self-report certain information that might incriminate them and that they would rather not see reported.

I don’t think we can leave it up to the legislation to force builders to self-report. I think there would have to be a means of actually verifying this information; therefore, there would have to be some kind of oversight watchdog that would collect information on legal proceedings that were under way or had taken place. I’m not sure how this information would be gathered. There is certainly a huge cost to that, to raking in all this information about new-home builders. To rely upon them to self-report I think would be naive at best.

I’m concerned that this amendment doesn’t really consider the ramifications of how difficult it will be to actually gather the information that the amendment proposes be registered. Therefore, I have these significant concerns about it. Perhaps the hon. member might comment on this aspect of requiring self-reporting to self-incriminate oneself and also the difficulty of gathering the information that would come from disparate sources and would require oversight, which would need a significant amount of staff, in my view, and be quite logistically difficult.

Dr. Swann: Well, thanks for those comments. No question that there are going to be additional costs to confirm reporting. That’s also the case with the present bill. You’re relying on builders to self-report into this registry as it is. The question is: do we have a reasonable and robust oversight body within the ministry to ensure that what’s being reported is accurate? That goes without question. Will it involve additional searches through the law courts, perhaps, and the registered convictions? I think that’s the price of accountability and transparency, and it’s what consumers expect of a government, that they not only provide information to the public but verify that the information that’s being put up there from whatever source is reliable and reasonable.

The Chair: The hon. Member for Calgary-Mackay-Nose Hill.

Ms McPherson: Thank you, Madam Chair. This proposed amendment refers to section 9. Now, currently this section reads in part:

9(1) The Registrar shall establish and maintain a registry that must include information on

(a) authorizations and exemptions issued or applied for under this Act.

What’s proposed in Bill 12 is that section 9(1)(a) be repealed and the following substituted:

(a) licences applied for, issued, renewed, suspended, cancelled or reinstated under this Act,

(a.1) authorizations applied for, issued, suspended or cancelled under this Act,

(a.2) exemptions applied for or issued under this Act.

Now, as I understand the amendment, we have quite a number of changes. This amendment proposes:

9(1) The Registrar shall establish and maintain a registry that must include information on

(a) licences applied for, issued, renewed, suspended, cancelled or reinstated under this Act,

(b) authorizations applied for, issued, suspended or cancelled under this Act,

(c) exemptions applied for or issued under this Act,

(d) claims that have been made under a home warranty insurance contract or under Part 1 of this Act,

(e) legal proceedings against a residential builder for structural defects, defects in materials or labour or any deficiency related to the construction of a new home,

(f) new homes built or under construction by residential builders, including details of the home warranty insurance contracts covering the new homes,

(g) new homes built or under construction by owner builders, including details of the home warranty insurance contracts covering the new homes, if applicable,

(h) persons in respect of whom administrative penalties have been imposed or compliance orders have been issued under this Act,

(i) persons convicted of an offence under this Act, and

(j) any other prescribed information.

So with that particular part it seems to me that the idea is to create, essentially, a Carfax for houses. I’m wondering if the member who introduced the amendment can explain how much consultation has gone into the development of this list with the stakeholders.

Dr. Swann: Well, thank you very much for the question. I’ve had no consultation on this. This is based on, I guess, common-sense requirements that seem applicable to all consumers who would want to know, ideally, how much has gone on in the background of a particular builder and as comprehensive a list as is possible to gather so that buyers can be aware, buyers can know as much as possible about the background of a builder and ensure that they’re getting what they think they’re buying.

….

The Chair: Any further speakers to amendment A3? Seeing none, are you ready for the question?

[Motion on amendment A3 lost]