North Carolina is awash in new home construction as the state’s metro areas continue to grow at a torrid pace1.

But as new houses go up, several new laws have gone into effect that restrict the number of construction inspections that municipalities are allowed to conduct. Some of the suburban towns facing the most growth are now starting to push back.

The conflict encapsulates several important themes: successful lobbying, the General Assembly’s bias against municipalities, and a trend toward deregulation.

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Beginning in 2013, a string of new laws has gone into effect restricting home inspections.

All were strongly supported by the N.C. Homebuilders Association and fix what they considered to be undue burdens during the building code inspection process2.

Towns and counties across the state employ code enforcement officials, whose job it is to go around to new construction and check to make sure everything’s up to snuff. The state building code lays out minimum standards and what’s required to be checked.

Sometimes, though, builders believe that inspections come too slowly, or that code enforcement inspectors like to throw their weight around improperly.

So first came House Bill 120, passed in 2013. It prevents local code enforcement departments from requiring inspections beyond what’s spelled out in the building code.

Then came House Bill 255, passed in 2015. It does a few noteworthy things:

  • Raises the dollar amount of home construction projects that need inspections, from $5,000 to $15,000.
  • Requires code enforcement to conduct all requested inspections fully and provide a list of violations. Before, in some cases, town officials would refuse to complete inspections until initial violations are fixed, which meant builders were being inspected multiple times.
  • Makes it “official misconduct” for a code enforcement inspector to impose a requirement that goes above and beyond the state building code, or to not conduct inspections in a “timely manner.”

House Bill 252, passed in 2017, adds some clarifications to the above two bills.

Simple enough, right? The effect was to curb what’s perceived as business-unfriendliness. It feels reasonable in a perfect world3.

This year, both sides are complaining to state lawmakers that things aren’t working right.

The N.C. Homebuilders Association is getting the state to crack down on towns not going along with these laws.

They got a memo sent to all code enforcement departments in February reminding them of the law, according to a presentation to state lawmakers.

The Homebuilders Association then went through town websites and surveyed their members to check up — with mixed results.

Places like Durham County, Fayetteville and Sunset Beach have eliminated some extra inspections they’ve been accustomed to doing — like floor framing and wall sheathing.

Others, like Cumberland County and Granville County, are still performing some of these inspections, the Homebuilders Association told lawmakers.

Under pressure, Orange County says they’re “reassessing” how they conduct inspections.

Meanwhile, town code enforcement departments are saying they can’t protect homebuyers.

The town of Cary’s department says that the law “effectively deregulates the construction industry in a period of high volume and at a time where fewer skilled construction laborers are available.”

They cite a few things they’d like to be able to take a look at before they’re covered up, like the wrapping under siding and floor framing.

Cary claims that good builders are harmed by the new law because inspectors can’t get to their projects on time. Instead of telling a builder with lots of problems to fix things before they come back, inspectors have to write out a detailed list of everything that’s wrong with the home.

“The ability to provide adequate consumer protection for homeowners is at risk,” they write in a memo.

New houses in Cary. Photo by Payton Chung via Flickr (Creative Commons)

This debate highlights the push-and-pull that comes with a General Assembly agenda that includes rolling back regulations.

In this case, the question is simple: What’s the right balance between encouraging development and protecting consumers?

The new laws are designed to protect homebuilders against overzealous inspectors who improperly wield their ability to grind construction to a halt.

But the town of Cary has a valid point: There are unintended consequences. We probably won’t be able to tell for a few more years whether these houses inspected under the new regime develop problems at a higher rate.

All these laws passed with little debate or dissension.

But the only way to really cast an informed vote would be to shadow both a homebuilder and an inspector for at least a day, to see how the process is working. How many lawmakers do you think were able to do that?

In the absence of that, lobbyists4 fill the void. And right now, it’s clear that homebuilders have more influence than towns.

Homepage photo of Cary houses by Payton Chung via Flickr (Creative Commons)

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