Proposed fines lowered for unregistered firms

Robert Paynter of B.I.F. Contracting Inc., Delavan, cuts trim for a new Papa Jimmy’s Pizzeria in Cottage Grove recently. Harmony Construction Management Inc., Madison, is the general contractor for the project. A 16-month-old state law requires contractors to register with the state. (Photo by Tessa Treuden)

By Justin Kern
Special to The Daily Reporter

The Wisconsin law requiring contractors to register with the state before going on a work site may be getting some teeth, but with a much smaller bite than initially proposed.

The state Department of Commerce has lowered proposed fines for unregistered general contractors and subcontractors that would have been among the highest in the Midwest.

Tony Hozeny, communications director with Commerce, said the proposed penalties were reduced after they received a chilly reception from contractors and their representatives in public hearings. The Legislature has received the revised penalty proposal, though a date for review by a standing committee has not yet been set, Hozeny said.

Penalties for contractors or subcontractors found working on pulled permits without state registration are proposed as $250 for first offense, $500 for second offense and $1,000 for subsequent offenses.

Those proposals were reduced from $1,000 for the first infraction, $1,500 for second and $2,000 for subsequent, according to Commerce documents.

The Associated General Contractors of Wisconsin Inc., Madison, which has been critical of the law, supported the lower proposed penalties.

Jim Boullion, AGC of Wisconsin’s government affairs director, said he expects most contractors to register with the state, and the lower proposed penalties are more realistic.

“Really, you need to match the penalty to the crime,” Boullion said.

Hozeny said he could not speculate on how the changes would affect the number of contractors his department expects to register or punish.

More than 10,000 contractors have paid $100 to register electronically or $115 to sign up through the mail for a four-year registration, according to Commerce documents.

The registration law took effect in March 2009. It requires contractors to register with Commerce’s Division of Safety and Buildings if their work is covered under state codes affecting public and commercial buildings, one- and two-family dwellings and public swimming pools.

The law left setting penalties for unregistered contractors up to Commerce.

The proposed penalties for noncompliance are based in part on data from surrounding states, according to state documents. Registration costs and penalty levels in other states that Commerce considered included:

• Illinois: no licensure requirements for building contractors

• Iowa: registration required (2 years, $25); non-registration penalties: $500 (first violation), $5,000 (subsequent violation)

• Michigan: registration required (3 years, $225); non-registration penalties: $5,000 to $25,000 and/or one year imprisonment (first and subsequent offenses)

• Minnesota: residential contractor or remodeler ($260 to $360 annually, based on receipts); independent building contractors (2 years, $250); non-registration penalties, up to $5,000 (first and subsequent offenses)

After approval from the Legislature, Wisconsin’s penalties would take effect the first day of the month following official public notice. Commerce would enforce the penalties based on tips and investigations, according to state documents, and no additional Commerce staffing is expected to be needed.

Glenn Bade, owner and sole operator of Waukesha-based Proform Plumbing LLC, registered earlier this year. Bade said he was disappointed the state is mandating registration for small, one-man businesses such as his, in addition to other inspection and license requirements.

“My feeling is that it’s just enough with the license and fees,” he said. “Between dealing with inspectors and everything else, it’s always something with (the state).”