1998 Regular Session
To: Judiciary B
By: Representative Endt
House Bill 944
AN ACT TO AMEND SECTION 31-3-1, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE EXCEPTIONS ESTABLISHED FOR CERTAIN CONTRACTS AND UNDERTAKINGS ON PUBLIC AND PRIVATE PROJECTS SHALL APPLY ONLY TO MISSISSIPPI CONTRACTORS; TO DELETE THE PROVISION WHICH PROVIDES THAT THE TERM "CONTRACTOR" SHALL NOT INCLUDE ANY OWNER OF A DWELLING WHICH IS TO BE CONSTRUCTED, BUT IS NOT FOR SALE, LEASE OR PUBLIC USE; TO AMEND SECTION 31-3-13, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE STATE BOARD OF PUBLIC CONTRACTORS SHALL ESTABLISH AND ENFORCE PENALTIES FOR ANY VIOLATION OF THE RULES AND REGULATIONS ESTABLISHED BY THE BOARD; TO PROVIDE FOR THE SUSPENSION OF ANY UNDERTAKING BY A CONTRACTOR, IF THERE ARE CONTINUOUS VIOLATIONS OF THE RULES AND REGULATIONS ESTABLISHED BY THE BOARD; TO PROVIDE THAT IF A CERTIFICATE HOLDER RENEWS HIS CERTIFICATE OF RESPONSIBILITY WITHIN ONE YEAR AFTER EXPIRATION, THEN HE SHALL PAY THE SPECIAL PRIVILEGE TAX PLUS A PENALTY IN ORDER TO GET HIS CERTIFICATE RENEWED; TO AMEND SECTION 31-3-17, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT ANY AMOUNTS REMAINING IN THE STATE BOARD OF CONTRACTORS FUND AT THE END OF THE FISCAL YEAR SHALL NOT LAPSE INTO THE STATE GENERAL FUND; TO PROVIDE THAT INTEREST ACCRUED SHALL REMAIN IN THE FUND; TO AMEND SECTION 31-3-19, MISSISSIPPI CODE OF 1972, TO DELETE THE PROVISION WHICH STATES THAT IF AN APPLICATION FOR A CERTIFICATE OF RESPONSIBILITY IS NOT GRANTED, THEN THE PAYMENT OF THE SPECIAL PRIVILEGE TAX SHALL BE REFUNDED; TO AMEND SECTION 31-3-21, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE STATE BOARD OF CONTRACTORS MAY MAINTAIN PROCEEDINGS IN ITS NAME IN COURT TO ENFORCE THE PENALTIES AUTHORIZED BY LAW; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 31-3-1, Mississippi Code of 1972, is amended as follows:
31-3-1. The following words, as used in this chapter, shall have the meanings specified below:
"Board": The State Board of Contractors created under this chapter.
"Contractor": Any person contracting or undertaking as prime contractor, subcontractor or sub-subcontractor of any tier to do any erection, building, construction, reconstruction, repair, maintenance or related work on any public or private project * * *. It is further provided that nothing herein shall apply to the following if undertaken by a prime contractor, subcontractor or sub-subcontractor residing in the State of Mississippi:
(a) Any contract or undertaking on a public project by a prime contractor, subcontractor or sub-subcontractor of any tier involving erection, building, construction, reconstruction, repair, maintenance or related work where such contract, subcontract or undertaking is less than Fifty Thousand Dollars ($50,000.00);
(b) Any contract or undertaking on a private project by a prime contractor, subcontractor or sub-subcontractor of any tier involving erection, building, construction, reconstruction, repair, maintenance or related work where such contract, subcontract or undertaking is less than One Hundred Thousand Dollars ($100,000.00);
(c) Highway construction, highway bridges, overpasses and any other project incidental to the construction of highways which are designated as federal aid projects and in which federal funds are involved;
(d) A residential project to be occupied by fifty (50) or fewer families and not more than three (3) stories in height;
(e) A residential subdivision where the contractor is developing either single-family or multi-family lots;
(f) A new commercial construction project not exceeding seventy-five hundred (7500) square feet and not more than two (2) stories in height; or
(g) Erection of a microwave tower built for the purpose of telecommunication transmissions.
The provisions of this chapter shall apply if paragraphs (a), (b), (c), (d), (e), (f) or (g) of this section are undertaken by a nonresident prime contractor, subcontractor or sub-subcontractor.
"Certificate of responsibility": A certificate numbered and held by a contractor issued by the board under the provisions of this chapter after payment of the special privilege license tax therefor levied under this chapter.
"Person": Any person, firm, corporation, joint venture or partnership, association or other type of business entity.
"Private project": Any project for erection, building, construction, reconstruction, repair, maintenance or related work which is not funded in whole or in part with public funds.
"Public agency": Any board, commission, council or agency of the State of Mississippi or any district, county or municipality thereof, including school, hospital, airport and all other types of governing agencies created by or operating under the laws of this state.
"Public funds": Monies of public agencies, whether obtained from taxation, donation or otherwise; or monies being expended by public agencies for the purposes for which such public agencies exist.
"Public project": Any project for erection, building, construction, reconstruction, repair, maintenance or related work which is funded in whole or in part with public funds.
SECTION 2. Section 31-3-13, Mississippi Code of 1972, is amended as follows:
31-3-13. The board shall have the following powers and responsibilities:
(a) To receive applications for certificates of responsibility, to investigate and examine applicants for same by holding hearings and securing information, to conduct examinations, and to issue certificates of responsibility to such contractors as the board finds to be responsible. * * *
* * * All original certificates and renewals thereof * * * shall expire one (1) year from the date of issuance. No certificate * * * shall be issued until the application has been on file with the board for at least thirty (30) days. Applications for renewal may be granted immediately after filing. The failure on the part of the certificate holder to renew his certificate shall not deprive such certificate holder of the right of renewal, provided that renewal is effected within one (1) year after the expiration date of the certificate by payment of the special privilege tax under this chapter plus a penalty of one hundred percent (100%) of the special privilege tax under this chapter. Application for renewal of certificates of responsibility, together with the payment of a fee of One Hundred Dollars ($100.00) under the terms of this chapter, shall serve to extend the current certificate until the board either renews the certificate or denies the application.
No certificate of responsibility or any renewal thereof shall be issued until the applicant furnishes to the board his Mississippi state sales tax number or Mississippi state use tax number and his state income tax identification numbers.
The board shall conduct an objective, standardized examination of an applicant for a certificate to ascertain the ability of the applicant to make practical application of his knowledge of the profession or business of construction in the category or categories for which he has applied for a certificate of responsibility. The cost of the test and the cost of administering the test shall be paid for by applicants for certificates of responsibility at the time applications are filed. The board shall investigate thoroughly the past record of all applicants, which will include an effort toward ascertaining the qualifications of applicants in reading plans and specifications, estimating costs, construction ethics, and other similar matters. The board shall take all applicants under consideration after having examined him or them and go thoroughly into the records and examinations, prior to granting any certificate of responsibility. If the applicant is an individual, examination may be taken by his personal appearance for examination or by the appearance for examination of one or more of his responsible managing employees; and if a copartnership or corporation or any other combination or organization, by the examination of one or more of the responsible managing officers or members of the executive staff of the applicant's firm, according to its own designation.
(b) To conduct thorough investigations of all applicants seeking renewal of their licenses and of all complaints filed with the board concerning the performance of a contractor on a public or private project.
(c) To obtain information concerning the responsibility of any applicant for a certificate of responsibility or a holder of a certificate of responsibility under this chapter. Such information may be obtained by investigation, by hearings, or by any other reasonable and lawful means. The board shall keep such information appropriately filed and shall disseminate same to any interested person. The board shall have the power of subpoena.
(d) To maintain a list of contractors to whom certificates of responsibility are issued, refused, revoked or suspended, which list shall be available to any interested person. Such list shall indicate the kind or kinds of works or projects for which a certificate of responsibility was issued, refused, revoked or suspended.
(e) To revoke by order entered on its minutes a certificate of responsibility upon a finding by the board that a particular contractor is not responsible, and to suspend such certificate of responsibility in particular cases pending investigation, upon cause to be stated in the board's order of suspension. No such revocation or suspension shall be ordered without a hearing conducted upon not less than ten (10) days' notice to such certificate holder by certified or registered mail, wherein the holder of the certificate of responsibility shall be given an opportunity to present all lawful evidence which he may offer.
(f) To adopt rules and regulations setting forth the requirements for certificates of responsibility, the revocation or suspension thereof, and all other matters concerning same; rules and regulations governing the conduct of the business of the board and its employees; and such other rules and regulations as the board finds necessary for the proper administration of this chapter, including those for the conduct of its hearings on the revocation or suspension of certificates of responsibility. Such rules and regulations shall not conflict with the provisions of this chapter.
(g) The board shall have the power and responsibility to classify the kind or kinds of works or projects that a contractor is qualified and entitled to perform under the certificate of responsibility issued to him. Such classification shall be specified in the certificate of responsibility.
The powers of the State Board of Contractors shall not extend to fixing a maximum limit in the bid amount of any contractor, or the bonding capacity, or a maximum amount of work which a contractor may have under contract at any time, except as stated in paragraph (a) of this section; and the Board of Contractors shall not have jurisdiction or the power or authority to determine the maximum bond a contractor may be capable of obtaining. The board, in determining the qualifications of any applicant for an original certificate of responsibility or any renewal thereof, shall, among other things, take into consideration the following: (1) experience and ability, (2) character, (3) the manner of performance of previous contracts, (4) financial condition, (5) equipment, (6) personnel, (7) work completed, (8) work on hand, (9) ability to perform satisfactorily work under contract at the time of an application for a certificate of responsibility or a renewal thereof, (10) default in complying with provisions of this law, or any other law of the state, and (11) the results of objective, standardized examinations. A record shall be made and preserved by the board of each examination of an applicant and the findings of the board thereon, and a certified copy of the record and findings shall be furnished to any applicant desiring to appeal from any order or decision of the board.
(h) The board shall enter upon its minutes an order or decision upon each application filed with it, and it may state in such order or decision the reason or reasons for its order or decision.
Upon failure of the board to enter an order or decision upon its minutes as to any application within one hundred eighty (180) days from the date of filing such application, the applicant shall have the right of appeal as otherwise provided by this chapter.
The holder of any valid certificate of responsibility issued by the Board of Public Contractors prior to January 1, 1986, shall be automatically issued a certificate of responsibility by the State Board of Contractors for the same classification or classifications of work which the holder was entitled to perform under the State Board of Public Contractors Act.
(i) To establish and enforce penalties for any violations of the rules and regulations established by the board under this chapter. To suspend any contract or undertaking by a nonresident contractor, if there are continuous violations of such rules and regulations.
SECTION 3. Section 31-3-17, Mississippi Code of 1972, is amended as follows:
31-3-17. There is hereby levied, in addition to any taxes otherwise provided for by law, a special privilege license tax of One Hundred Dollars ($100.00) on each contractor to whom a certificate of responsibility is issued under this chapter; and such tax shall be paid to the executive secretary of the board before engaging in or continuing in such business in this state. The board may levy an additional fee not to exceed Fifty Dollars ($50.00) for each additional classification for which a contractor applies and is found to be qualified. The executive secretary of the board shall promptly deposit all monies received under this chapter in the State Treasury. Except for the civil penalty provided in Section 31-3-21 which shall be deposited into the State General Fund, all monies received under this chapter shall be kept in a special fund in the State Treasury known as the "State Board of Contractors Fund," and shall be used only for the purposes of this chapter. Amounts in the fund shall not lapse into the State General Fund at the end of a fiscal year. Interest accrued to the fund shall remain in the fund. All expenditures from the Board of Contractors Fund shall be by requisition to the Department of Finance and Administration, signed by the executive secretary of the board and countersigned by the chairman or vice chairman of the board, and the State Treasurer shall issue his warrants thereon.
SECTION 4. Section 31-3-19, Mississippi Code of 1972, is amended as follows:
31-3-19. All applications for the original issuance of a certificate of responsibility or for any renewal thereof shall be made on a form prescribed by the board, accompanied by the special privilege tax * * *.
SECTION 5. Section 31-3-21, Mississippi Code of 1972, is amended as follows:
31-3-21. (1) It shall be unlawful for any person who does not hold a certificate of responsibility issued under this chapter, or a similar certificate issued by another state recognizing such certificate issued by the State of Mississippi, to submit a bid, enter into a contract, or otherwise engage in or continue in this state in the business of a contractor, as defined in this chapter. Any bid which is submitted without a certificate of responsibility number issued under this chapter and without that number appearing on the exterior of the bid envelope, as and if herein required, at the time designated for the opening of such bid, shall not be considered further, and the person or public agency soliciting bids shall not enter into a contract with a contractor submitting a bid in violation of this section. In addition, any person violating this section by knowingly and willfully submitting a bid for projects without holding a certificate of responsibility number issued under this chapter, as and if herein required, at the time of the submission or opening of such bid shall be guilty of a misdemeanor and, upon conviction, shall be punished by a fine of not more than One Thousand Dollars ($1,000.00), or by imprisonment for not more than six (6) months, or by both such fine and imprisonment.
(2) All bids submitted for public or private projects where said bid is in excess of Fifty Thousand Dollars ($50,000.00) with respect to public projects and in excess of One Hundred Thousand Dollars ($100,000.00) with respect to private projects shall contain on the outside or exterior of the envelope or container of such bid the contractor's current certificate number, and no bid shall be opened or considered unless such contractor's current certificate number appears on the outside or exterior of said envelope or container, or unless there appears a statement on the outside or exterior of such envelope or container to the effect that the bid enclosed therewith did not exceed Fifty Thousand Dollars ($50,000.00) with respect to public projects or One Hundred Thousand Dollars ($100,000.00) with respect to private projects. Any person violating the provisions of this subsection shall be guilty of a misdemeanor and, upon conviction, shall be punished by a fine of not more than One Thousand Dollars ($1,000.00), or by imprisonment for not more than six (6) months, or by both such fine and imprisonment.
(3) In the letting of public contracts preference shall be given to resident contractors, and a nonresident bidder domiciled in a state having laws granting preference to local contractors shall be awarded Mississippi public contracts only on the same basis as the nonresident bidder's state awards contracts to Mississippi contractors bidding under similar circumstances; and resident contractors actually domiciled in Mississippi, be they corporate, individuals, or partnerships, are to be granted preference over nonresidents in awarding of contracts in the same manner and to the same extent as provided by the laws of the state of domicile of the nonresident. When a nonresident contractor submits a bid for a public project, he shall attach thereto a copy of his resident state's current law pertaining to such state's treatment of nonresident contractors. As used in this section, the term "resident contractors" includes a nonresident person, firm or corporation that has been qualified to do business in this state and has maintained a permanent full-time office in the State of Mississippi for two (2) years prior to January 1, 1986, and the subsidiaries and affiliates of such a person, firm or corporation. Any public agency awarding a contract shall promptly report to the State Tax Commission the following information:
(a) The amount of the contract.
(b) The name and address of the contractor reviewing the contract.
(c) The name and location of the project.
(4) In addition to any other penalties provided in this chapter, and upon a finding of a violation of this chapter, the State Board of Contractors may, after notice and hearing, issue an order of abatement directing the contractor to cease all actions constituting violations of this chapter until such time as the contractor complies with Mississippi state law, and to pay to the board a civil penalty to be deposited into the State General Fund of not more than three percent (3%) of the total contract being performed by the contractor.
(5) When payment of a monetary penalty assessed and levied by the board in accordance with this section is not paid when due, or when an order of abatement issued by the board in accordance with the section is not followed, the board shall have the power to institute and maintain proceedings in its name for enforcement of payment or the order of abatement in the Chancery Court of the First Judicial District of Hinds County, Mississippi.
SECTION 6. This act shall take effect and be in force from and after July 1, 1998.