Sec. 1. 10 MRSA §1486, sub-§§6 and 7 are enacted to read:

6.__Home construction contractor.__"Home construction contractor" means a person who enters into a written or oral home construction contract with a homeowner or lessee.

7.__Prepayment.__"Prepayment" means payments, including advances and down payments, by the homeowner or lessee to a home construction contractor for construction work prior to the completion of the work.__"Prepayment" does not include progress payments.

Sec. 2. 10 MRSA §1489, as enacted by PL 1987, c. 574, is amended to read:

§1489. Exemption

Parties to a home construction contract may exempt themselves from the requirements of this chapter, except section 1489-A, only if the contractor specifically informs the homeowner or lessee of his the homeowner or lessee's rights under this chapter and the parties then mutually agree to a contract or change order that does not contain the parts set forth in sections 1487 and 1488.

Sec. 3. 10 MRSA §1489-A is enacted to read:

§1489-A.__Bonding

Home construction contractors must be bonded for an amount at least equal to the amount of a prepayment.

SUMMARY

This bill requires home construction contractors to be bonded for an amount equal to prepayments made by a homeowner or lessee.