§708-8305 Unlicensed contractor fraud; valuation of property. (1) For purposes of unlicensed contractor fraud, the value of the property shall be the greater of:

(a) The value of property as provided in section 708-801; or

(b) The total value of all moneys and any assets of value paid or lost by the victim or victims pursuant to the same scheme or course of conduct.

(2) The value of any work done by the unlicensed contractor shall not be used as an offset for the value of the property calculated under this section. [L 2012, c 244, pt of §1; am L 2013, c 26, §1]

COMMENTARY ON §§708-8300 TO 708-8305

Act 244, Session Laws 2012, added these sections to deter unlicensed contracting activity. Specifically, Act 244 added a new part containing these sections to chapter 708 that established: (1) misdemeanor and felony offenses relating to unlicensed contracting activity; (2) felony offenses relating to unlicensed contractor fraud; and (3) a method for valuation of property in unlicensed contractor fraud cases. The legislature found that unlicensed contractors often operate without regard to safety and building requirements, unfairly undercut legitimate and licensed business operations, place consumers at risk, and cost the State millions of dollars in lost tax revenue. The legislature further found that unlicensed contractors often continue to engage in illegal work despite receiving civil penalties. Authorizing the imposition of criminal penalties on unlicensed contractors would help reduce the number of unlicensed contractors performing illegal work, promote legitimate businesses, protect consumers, and enhance state revenues. Senate Standing Committee Report No. 3348, Conference Committee Report No. 59-12.

Act 26, Session Laws 2013, amended §708-8305 to clarify that the value of any work done by an unlicensed contractor shall not be used as an offset in calculating the value of the property in unlicensed contractor fraud cases. Minimum thresholds for the total value of the property over which a person obtains control must be met in order for an act to constitute unlicensed contractor fraud in the first or second degree. By permitting an offset of the value of work illegally performed by an unlicensed contractor, the value of the property was less likely to meet the threshold necessary to constitute the offense. Act 26 made it clear that no offset should be applied when calculating the property value for the offenses. Senate Standing Committee Report No. 456, House Standing Committee Report No. 1410.

Act 182, Session Laws 2013, amended §708-8300(1) by clarifying that a contractor who inadvertently fails to maintain licensing requirements and who subsequently corrects the failure so that there was a lapse of no more than sixty days in licensure shall not be guilty of unlicensed contracting activity. Act 182 was intended to clarify that contractors licensed under chapter 444, who inadvertently failed to renew their licenses should not be treated as unlicensed contractors after the subsequent renewal of their licenses. Act 182 was consistent with existing licensure requirements under chapter 444, by clarifying that a lapse in licensure of no more than sixty days does not constitute unlicensed contracting activity. Senate Standing Committee Report No. 1373.