Builders warn S.183 could sweep routine disputes into criminal cases without a statewide building-code system

Andrew Brewer, a lobbyist with Downs, Racklin & Martin, told the Judiciary Committee on March 31 that the Senate's addition of a "knowing intent to defraud" standard to S.183 was an improvement but raised a practical concern: "The question for builders on the ground is whether that standard is clear enough to consistently separate fraud from a project dispute." Brewer was testifying on behalf of the Vermont Builders and Remodelers Association.

Brewer outlined how Vermont differs from most states on residential regulation. "Vermont is one of the handful of states that does not have a statewide residential building code for one and two-family owner-occupied homes," he said, and noted the state's Residential Building Energy Standards (RBES) "is a code without a system around it" because there are no statewide inspectors or a licensing body to enforce it.

"So disputes tend to come down to one party's version of events versus another's," Brewer said, arguing that when there is no inspector or objective record, it becomes difficult to distinguish performance or expectation disputes from intentional fraud. He asked the committee to consider guardrails that would "clarify that good faith disputes are not criminal conduct."

Jason Webster, owner of Huntington Homes, described his company's factory-built product and the practical consequences of the state's enforcement gap. Webster said that for homes built to ship out of state there are in-plant inspections and receiving-state inspections, but "In Vermont, there is nobody. There's no code and there is nobody looking at what we're doing." He said that when walls are closed in Vermont-built units, the lack of local code enforcement makes it harder to document whether a contractor knowingly intended to defraud a homeowner or simply could not meet a technical specification.

Webster and Brewer cited a Department of Public Service review from 2015 that found nearly half of houses then did not meet the energy standard; Webster offered an industry estimate, framed as his opinion, that compliance today is substantially lower than full compliance and said he did not want the bill to turn contractors into criminals for routine noncompliance. "I want to make sure that 90% of contractors aren't all of a sudden criminals," Webster said (estimate attributed to the witness).

Todd D'Aloisio, an Assistant Attorney General, told the committee the department was "comfortable with the bill" as passed out of the Senate and framed S.183 as a correction responding to superior-court decisions about prior amendments. At the same time, he described home-improvement fraud prosecutions as "really hard cases to prosecute," noting many disputes are handled at the county level and that the state's consumer-assistance mediator often works the issue informally.

Committee members pressed witnesses on whether failure to meet the RBES could be treated as evidence of criminal intent. Witnesses and the AAG emphasized the evidentiary difficulty of proving a contractor knowingly intended to defraud a homeowner and said criminal prosecutions would likely be reserved for egregious cases with strong evidence. As the AAG summarized, using an administrative or contractual standard as the basis of a criminal intent charge "is tricky" and would be challenging to prove beyond a reasonable doubt.

Witnesses also discussed contract practices and the contractor registry maintained by the Office of Professional Regulation (OPR). They said contract detail varies by builder; where contracts explicitly promise to meet a code standard, knowingly making that promise and intending not to perform could present a different legal posture than generalized noncompliance. But speakers warned that the contractor registry is largely a registration mechanism rather than a licensing system and that much routine noncompliance reflects cost trade-offs rather than intentional wrongdoing.

The committee did not take a vote. Members said they would hear additional witnesses, including a state's attorney, to test whether the bill requires clarifying language or other guardrails to avoid criminalizing ordinary contract disputes or widespread noncompliance with RBES. The hearing recessed with follow-up testimony expected at a later session.