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Second Substitute H.B. 320

Representative Christopher N. Herrod proposes the following substitute bill:





Chief Sponsor: Christopher N. Herrod

Senate Sponsor: Curtis S. Bramble

             8      LONG TITLE
             9      General Description:
             10          This bill modifies a provision of the Utah Construction Trades Licensing Act related to
             11      alarm company employees.
             12      Highlighted Provisions:
             13          This bill:
             14          .    authorizes the issuance of a temporary license to certain alarm company employees;
             15          .    provides that certain behavior is unlawful conduct on the part of an alarm company
             16      and agent; and
             17          .    makes technical changes.
             18      Monies Appropriated in this Bill:
             19          None
             20      Other Special Clauses:
             21          None
             22      Utah Code Sections Affected:
             23      AMENDS:
             24          58-55-312, as renumbered and amended by Laws of Utah 2000, Chapter 317
             25          58-55-501, as last amended by Laws of Utah 2008, Chapter 377

             27          58-55-503, as last amended by Laws of Utah 2008, Chapter 382
             29      Be it enacted by the Legislature of the state of Utah:
             30          Section 1. Section 58-55-312 is amended to read:
             31           58-55-312. Interim and temporary permits.
             32          (1) Upon receipt of a complete application for licensure in accordance with Section
             33      58-55-302 , an applicant for licensure as an alarm company agent may be issued:
             34          (a) an interim permit[.]; or
             35          (b) subject to Subsection (3), a temporary permit.
             36          (2) (a) Each interim permit shall expire 90 days after it is issued or on the date on
             37      which the applicant is issued a license, whichever is earlier.
             38          (b) The division may reissue an interim permit if the delay in approving a license is
             39      beyond the control or influence of the interim permit holder.
             40          (3) (a) The division may issue a temporary permit to an applicant for a license as an
             41      alarm company agent if:
             42          (i) the division has received a background check on the applicant from the Bureau of
             43      Criminal Identification;
             44          (ii) (A) the applicant is or will be employed at a call center, office, or administrative
             45      facility of an alarm company; and
             46          (B) the applicant's only contact with a customer or potential customer of the alarm
             47      company is:
             48          (I) from the call center, office, or administrative facility; and
             49          (II) by telephone or other remote communication method; and
             50          (iii) the alarm company by which the applicant is or will be employed affirms in
             51      writing to the division that the applicant, if issued a temporary license, will act only within the
             52      scope of the temporary license, as provided in Subsection (3)(a)(ii).
             53          (b) A temporary license under this section expires 90 days after it is issued or the date
             54      on which the division issues a regular license to the applicant or denies the applicant's
             55      application, whichever is earlier.
             56          [(3)] (4) An interim permit holder may engage in the scope of an alarm company agent.

             57          Section 2. Section 58-55-501 is amended to read:
             58           58-55-501. Unlawful conduct.
             59          Unlawful conduct includes:
             60          (1) engaging in a construction trade, acting as a contractor, an alarm business or
             61      company, or an alarm company agent, or representing oneself to be engaged in a construction
             62      trade or to be acting as a contractor in a construction trade requiring licensure, unless the
             63      person doing any of these is appropriately licensed or exempted from licensure under this
             64      chapter;
             65          (2) acting in a construction trade, as an alarm business or company, or as an alarm
             66      company agent beyond the scope of the license held;
             67          (3) hiring or employing in any manner an unlicensed person, other than an employee
             68      for wages who is not required to be licensed under this chapter, to engage in a construction
             69      trade for which licensure is required or to act as a contractor or subcontractor in a construction
             70      trade requiring licensure;
             71          (4) applying for or obtaining a building permit either for oneself or another when not
             72      licensed or exempted from licensure as a contractor under this chapter;
             73          (5) issuing a building permit to any person for whom there is no evidence of a current
             74      license or exemption from licensure as a contractor under this chapter;
             75          (6) applying for or obtaining a building permit for the benefit of or on behalf of any
             76      other person who is required to be licensed under this chapter but who is not licensed or is
             77      otherwise not entitled to obtain or receive the benefit of the building permit;
             78          (7) failing to obtain a building permit when required by law or rule;
             79          (8) submitting a bid for any work for which a license is required under this chapter by a
             80      person not licensed or exempted from licensure as a contractor under this chapter;
             81          (9) willfully or deliberately misrepresenting or omitting a material fact in connection
             82      with an application to obtain or renew a license under this chapter;
             83          (10) allowing one's license to be used by another except as provided by statute or rule;
             84          (11) doing business under a name other than the name appearing on the license, except
             85      as permitted by statute or rule;
             86          (12) if licensed as a specialty contractor in the electrical trade or plumbing trade,
             87      journeyman plumber, residential journeyman plumber, journeyman electrician, master

             88      electrician, or residential electrician, failing to directly supervise an apprentice under one's
             89      supervision or exceeding the number of apprentices one is allowed to have under his
             90      supervision;
             91          (13) if licensed as a contractor or representing oneself to be a contractor, receiving any
             92      funds in payment for a specific project from an owner or any other person, which funds are to
             93      pay for work performed or materials and services furnished for that specific project, and after
             94      receiving the funds to exercise unauthorized control over the funds by failing to pay the full
             95      amounts due and payable to persons who performed work or furnished materials or services
             96      within a reasonable period of time;
             97          (14) employing an unlicensed alarm business or company or an unlicensed individual
             98      as an alarm company agent, except as permitted under the exemption from licensure provisions
             99      under Section 58-1-307 ;
             100          (15) if licensed as an alarm company or alarm company agent, filing with the division
             101      fingerprint cards for an applicant which are not those of the applicant, or are in any other way
             102      false or fraudulent and intended to mislead the division in its consideration of the applicant for
             103      licensure;
             104          (16) if licensed under this chapter, willfully or deliberately disregarding or violating:
             105          (a) the building or construction laws of this state or any political subdivision;
             106          (b) the safety and labor laws applicable to a project;
             107          (c) any provision of the health laws applicable to a project;
             108          (d) the workers' compensation insurance laws of the state applicable to a project;
             109          (e) the laws governing withholdings for employee state and federal income taxes,
             110      unemployment taxes, FICA, or other required withholdings; or
             111          (f) reporting, notification, and filing laws of this state or the federal government;
             112          (17) aiding or abetting any person in evading the provisions of this chapter or rules
             113      established under the authority of the division to govern this chapter;
             114          (18) engaging in the construction trade or as a contractor for the construction of
             115      residences of up to two units when not currently registered or exempt from registration as a
             116      qualified beneficiary under Title 38, Chapter 11, Residence Lien Restriction and Lien Recovery
             117      Fund Act;
             118          (19) failing, as an original contractor, as defined in Section 38-11-102 , to include in a

             119      written contract the notification required in Section 38-11-108 ;
             120          (20) wrongfully filing a mechanics' lien in violation of Section 38-1-25 ; [or]
             121          (21) if licensed as a contractor, not completing a three-hour core education class and an
             122      additional three hours of professional education approved by the division and the Construction
             123      Services Commission within each two-year renewal cycle, beginning with the two-year renewal
             124      cycle that starts July 1, 2005, and ends June 30, 2007 unless an exemption has been granted to
             125      the licensee by the Construction Services Commission, with the concurrence of the division,
             126      except that this Subsection (21) is repealed effective July 1, 2010 and its implementation is
             127      subject to the division receiving adequate funding for its implementation through a legislative
             128      appropriation[.];
             129          (22) an alarm company allowing an employee with a temporary license under Section
             130      58-55-312 to engage in conduct on behalf of the company outside the scope of the temporary
             131      license, as provided in Subsection 58-55-312 (3)(a)(ii); and
             132          (23) an alarm company agent under a temporary license under Section 58-55-312
             133      engaging in conduct outside the scope of the temporary license, as provided in Subsection
             134      58-55-312 (3)(a)(ii).
             135          Section 3. Section 58-55-503 is amended to read:
             136           58-55-503. Penalty for unlawful conduct -- Citations.
             137          (1) (a) (i) A person who violates Subsection 58-55-308 (2), Subsection 58-55-501 (1),
             138      (2), (3), (4), (5), (6), (7), (9), (10), (12), (14), [or] (15), (22), or (23) or Subsection
             139      58-55-504 (2), or who fails to comply with a citation issued under this section after it is final, is
             140      guilty of a class A misdemeanor.
             141          (ii) As used in this section in reference to Subsection 58-55-504 (2), "person" means an
             142      individual and does not include a sole proprietorship, joint venture, corporation, limited
             143      liability company, association, or organization of any type.
             144          (b) A person who violates the provisions of Subsection 58-55-501 (8) may not be
             145      awarded and may not accept a contract for the performance of the work.
             146          (2) A person who violates the provisions of Subsection 58-55-501 (13) is guilty of an
             147      infraction unless the violator did so with the intent to deprive the person to whom money is to
             148      be paid of the money received, in which case the violator is guilty of theft, as classified in
             149      Section 76-6-412 .

             150          (3) Grounds for immediate suspension of the licensee's license by the division and the
             151      commission include the issuance of a citation for violation of Subsection 58-55-308 (2), Section
             152      58-55-501 , or Subsection 58-55-504 (2), or the failure by a licensee to make application to,
             153      report to, or notify the division with respect to any matter for which application, notification, or
             154      reporting is required under this chapter or rules adopted under this chapter, including applying
             155      to the division for a new license to engage in a new specialty classification or to do business
             156      under a new form of organization or business structure, filing with the division current
             157      financial statements, notifying the division concerning loss of insurance coverage, or change in
             158      qualifier.
             159          (4) (a) If upon inspection or investigation, the division concludes that a person has
             160      violated the provisions of Subsection 58-55-308 (2) or Subsections 58-55-501 (1), (2), (3), (9),
             161      (10), (12), (14), (19), (21), (22), or (23), or Subsection 58-55-504 (2), or any rule or order issued
             162      with respect to these subsections, and that disciplinary action is appropriate, the director or the
             163      director's designee from within the division shall promptly issue a citation to the person
             164      according to this chapter and any pertinent rules, attempt to negotiate a stipulated settlement, or
             165      notify the person to appear before an adjudicative proceeding conducted under Title 63G,
             166      Chapter 4, Administrative Procedures Act.
             167          (i) A person who is in violation of the provisions of Subsection 58-55-308 (2),
             168      Subsection 58-55-501 (1), (2), (3), (9), (10), (12), (14), (19), [or] (21), (22), or (23) or
             169      Subsection 58-55-504 (2), as evidenced by an uncontested citation, a stipulated settlement, or
             170      by a finding of violation in an adjudicative proceeding, may be assessed a fine pursuant to this
             171      Subsection (4) and may, in addition to or in lieu of, be ordered to cease and desist from
             172      violating Subsection 58-55-308 (2), Subsection 58-55-501 (1), (2), (3), (9), (10), (12), (14), (19),
             173      or (21), or Subsection 58-55-504 (2).
             174          (ii) Except for a cease and desist order, the licensure sanctions cited in Section
             175      58-55-401 may not be assessed through a citation.
             176          (iii) (A) A person who receives a citation or is fined for violating Subsection
             177      58-55-501 (21) may also be issued a cease and desist order from engaging in work to be
             178      performed by a contractor licensed under this chapter unless the person meets the continuing
             179      education requirement within 30 days after receipt of the citation or fine.
             180          (B) The order, if issued, shall be removed upon the person's completion of the

             181      continuing education requirement.
             182          (C) This Subsection (4)(a)(iii) is repealed effective July 1, 2010.
             183          (b) (i) Each citation shall be in writing and describe with particularity the nature of the
             184      violation, including a reference to the provision of the chapter, rule, or order alleged to have
             185      been violated.
             186          (ii) The citation shall clearly state that the recipient must notify the division in writing
             187      within 20 calendar days of service of the citation if the recipient wishes to contest the citation
             188      at a hearing conducted under Title 63G, Chapter 4, Administrative Procedures Act.
             189          (iii) The citation shall clearly explain the consequences of failure to timely contest the
             190      citation or to make payment of any fines assessed by the citation within the time specified in
             191      the citation.
             192          (c) Each citation issued under this section, or a copy of each citation, may be served
             193      upon a person upon whom a summons may be served:
             194          (i) in accordance with the Utah Rules of Civil Procedure;
             195          (ii) personally or upon the person's agent by a division investigator or by a person
             196      specially designated by the director; or
             197          (iii) by mail.
             198          (d) (i) If within 20 calendar days from the service of a citation, the person to whom the
             199      citation was issued fails to request a hearing to contest the citation, the citation becomes the
             200      final order of the division and is not subject to further agency review.
             201          (ii) The period to contest a citation may be extended by the division for cause.
             202          (e) The division may refuse to issue or renew, suspend, revoke, or place on probation
             203      the license of a licensee who fails to comply with a citation after it becomes final.
             204          (f) The failure of an applicant for licensure to comply with a citation after it becomes
             205      final is a ground for denial of license.
             206          (g) No citation may be issued under this section after the expiration of six months
             207      following the occurrence of any violation.
             208          (h) Fines shall be assessed by the director or the director's designee according to the
             209      following:
             210          (i) for a first offense handled pursuant to Subsection (4)(a), a fine of up to $1,000;
             211          (ii) for a second offense handled pursuant to Subsection (4)(a), a fine of up to $2,000;

             212      and
             213          (iii) for any subsequent offense handled pursuant to Subsection (4)(a), a fine of up to
             214      $2,000 for each day of continued offense.
             215          (i) (i) For purposes of issuing a final order under this section and assessing a fine under
             216      Subsection (4)(i), an offense constitutes a second or subsequent offense if:
             217          (A) the division previously issued a final order determining that a person committed a
             218      first or second offense in violation of Subsection 58-55-308 (2), Subsection 58-55-501 (1), (2),
             219      (3), (9), (10), (12), (14), or (19), or Subsection 58-55-504 (2); or
             220          (B) (I) the division initiated an action for a first or second offense;
             221          (II) no final order has been issued by the division in the action initiated under
             222      Subsection (4)(i)(i)(B)(I);
             223          (III) the division determines during an investigation that occurred after the initiation of
             224      the action under Subsection (4)(i)(i)(B)(I) that the person committed a second or subsequent
             225      violation of the provisions of Subsection 58-55-308 (2), Subsection 58-55-501 (1), (2), (3), (9),
             226      (10), (12), (14), or (19), or Subsection 58-55-504 (2); and
             227          (IV) after determining that the person committed a second or subsequent offense under
             228      Subsection (4)(i)(i)(B)(III), the division issues a final order on the action initiated under
             229      Subsection (4)(i)(i)(B)(I).
             230          (ii) In issuing a final order for a second or subsequent offense under Subsection
             231      (4)(i)(i), the division shall comply with the requirements of this section.
             232          (5) (a) A penalty imposed by the director under Subsection (4)(h) shall be deposited
             233      into the Commerce Service Fund.
             234          (b) A penalty which is not paid may be collected by the director by either referring the
             235      matter to a collection agency or bringing an action in the district court of the county in which
             236      the person against whom the penalty is imposed resides or in the county where the office of the
             237      director is located.
             238          (c) A county attorney or the attorney general of the state is to provide legal assistance
             239      and advice to the director in any action to collect the penalty.
             240          (d) In an action brought to enforce the provisions of this section, reasonable attorney's
             241      fees and costs shall be awarded.

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