1.1 	A bill for an act
1.2 	relating to health and safety of homes; regulating home inspections; authorizing 
1.3 	rulemaking; imposing penalties; amending Minnesota Statutes 2004, section 
1.4 	116J.70, subdivision 2a; proposing coding for new law as Minnesota Statutes, 
1.5 	chapter 326B.
1.6 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.7 	Section 1. Minnesota Statutes 2004, section 116J.70, subdivision 2a, is amended to 
1.8 	read:
1.9 		Subd. 2a.License; exceptions. "Business license" or "license" does not include 
1.10 	the following:
1.11 	(1) any occupational license or registration issued by a licensing board listed in 
1.12 	section  214.01 or any occupational registration issued by the commissioner of health 
1.13 	pursuant to section  214.13; 
1.14 	(2) any license issued by a county, home rule charter city, statutory city, township, or 
1.15 	other political subdivision;
1.16 	(3) any license required to practice the following occupation regulated by the 
1.17 	following sections:
1.18 	(i) abstracters regulated pursuant to chapter 386;
1.19 	(ii) accountants regulated pursuant to chapter 326A;
1.20 	(iii) adjusters regulated pursuant to chapter 72B;
1.21 	(iv) architects regulated pursuant to chapter 326;
1.22 	(v) assessors regulated pursuant to chapter 270;
1.23 	(vi) athletic trainers regulated pursuant to chapter 148;
1.24 	(vii) attorneys regulated pursuant to chapter 481;
1.25 	(viii) auctioneers regulated pursuant to chapter 330;
2.1 	(ix) barbers and cosmetologists regulated pursuant to chapter 154;
2.2 	(x) boiler operators regulated pursuant to chapter 183;
2.3 	(xi) chiropractors regulated pursuant to chapter 148;
2.4 	(xii) collection agencies regulated pursuant to chapter 332;
2.5 	(xiii) dentists, registered dental assistants, and dental hygienists regulated pursuant 
2.6 	to chapter 150A;
2.7 	(xiv) detectives regulated pursuant to chapter 326;
2.8 	(xv) electricians regulated pursuant to chapter 326;
2.9 	(xvi) mortuary science practitioners regulated pursuant to chapter 149A;
2.10 	(xvii) engineers regulated pursuant to chapter 326;
2.11 	(xviii) insurance brokers and salespersons regulated pursuant to chapter 60A;
2.12 	(xix) certified interior designers regulated pursuant to chapter 326;
2.13 	(xx) midwives regulated pursuant to chapter 147D;
2.14 	(xxi) nursing home administrators regulated pursuant to chapter 144A;
2.15 	(xxii) optometrists regulated pursuant to chapter 148;
2.16 	(xxiii) osteopathic physicians regulated pursuant to chapter 147;
2.17 	(xxiv) pharmacists regulated pursuant to chapter 151;
2.18 	(xxv) physical therapists regulated pursuant to chapter 148;
2.19 	(xxvi) physician assistants regulated pursuant to chapter 147A;
2.20 	(xxvii) physicians and surgeons regulated pursuant to chapter 147;
2.21 	(xxviii) plumbers regulated pursuant to chapter 326;
2.22 	(xxix) podiatrists regulated pursuant to chapter 153;
2.23 	(xxx) practical nurses regulated pursuant to chapter 148;
2.24 	(xxxi) professional fund-raisers regulated pursuant to chapter 309;
2.25 	(xxxii) psychologists regulated pursuant to chapter 148;
2.26 	(xxxiii) real estate brokers, salespersons, and others regulated pursuant to chapters 
2.27 	82 and 83;
2.28 	(xxxiv) registered nurses regulated pursuant to chapter 148;
2.29 	(xxxv) securities brokers, dealers, agents, and investment advisers regulated 
2.30 	pursuant to chapter 80A;
2.31 	(xxxvi) steamfitters regulated pursuant to chapter 326;
2.32 	(xxxvii) teachers and supervisory and support personnel regulated pursuant to 
2.33 	chapter 125;
2.34 	(xxxviii) veterinarians regulated pursuant to chapter 156;
2.35 	(xxxix) water conditioning contractors and installers regulated pursuant to chapter 
2.36 	326;
3.1 	(xl) water well contractors regulated pursuant to chapter 103I;
3.2 	(xli) water and waste treatment operators regulated pursuant to chapter 115;
3.3 	(xlii) motor carriers regulated pursuant to chapter 221;
3.4 	(xliii) professional firms regulated under chapter 319B;
3.5 	(xliv) real estate appraisers regulated pursuant to chapter 82B;
3.6 	(xlv) residential building contractors, residential remodelers, residential roofers, 
3.7 	manufactured home installers, and specialty contractors regulated pursuant to chapter 326;
3.8 	(xlvi) licensed professional counselors regulated pursuant to chapter 148B; and
3.9 	(xlvii) home inspectors licensed according to chapter 326B;
3.10 	(4) any driver's license required pursuant to chapter 171;
3.11 	(5) any aircraft license required pursuant to chapter 360;
3.12 	(6) any watercraft license required pursuant to chapter 86B;
3.13 	(7) any license, permit, registration, certification, or other approval pertaining to a 
3.14 	regulatory or management program related to the protection, conservation, or use of or 
3.15 	interference with the resources of land, air, or water, which is required to be obtained 
3.16 	from a state agency or instrumentality; and
3.17 	(8) any pollution control rule or standard established by the Pollution Control 
3.18 	Agency or any health rule or standard established by the commissioner of health or any 
3.19 	licensing rule or standard established by the commissioner of human services.

3.20 	Sec. 2. [326B.01] HOME INSPECTION.
3.21 		Subdivision 1.Definitions. The terms used in this chapter have the following 
3.22 	meanings unless otherwise provided for by text.
3.23 	(a) "Client" means the specific person named as the client in an inspection report or, 
3.24 	if not named, the specific person for whom an inspection is provided.
3.25 	(b) "Commissioner" means the commissioner of commerce.
3.26 	(c) "Council" means the Minnesota Home Inspector Technical Advisory Council.
3.27 	(d) "Department" means the Minnesota Department of Commerce.
3.28 	(e) "Engage in home inspection" means to perform, or offer to perform, a home 
3.29 	inspection for compensation or other valuable consideration or to hold oneself out to the 
3.30 	public as qualified to perform a home inspection.
3.31 	(f) "Examination" means an independent, national, and proctored examination, 
3.32 	approved by the commissioner, that was developed in conformance with psychometric 
3.33 	principles as evaluated by a service having qualified psychometricians and meets 
3.34 	development, maintenance, and administration standards of the National Commission 
3.35 	of Certifying Agencies and the "Standards for Educational and Psychological Testing" 
4.1 	developed jointly by the National Council on Measurement in Education, the American 
4.2 	Educational Research Association, and the American Psychological Association.
4.3 	(g) "Home inspection" means the act of visually examining and reporting the 
4.4 	physical condition of readily accessible systems and components of a manufactured home 
4.5 	or a building containing one to four residential dwelling units.
4.6 	(h) "Home inspector license" means the Minnesota license issued to individuals 
4.7 	under chapter 326B.
4.8 	(i) "Home inspector" means an individual at least 18 years old to whom a valid 
4.9 	license is issued according to the provisions of this chapter.
4.10 		Subd. 2.License required; exemptions. (a) Notwithstanding section 326.03, 
4.11 	subdivision 2, an individual must have a valid Minnesota home inspector license to engage 
4.12 	in home inspection within Minnesota.
4.13 	(b) Nothing in this section prevents individuals from acting within the scope of the 
4.14 	individual's trade or profession, such as real estate appraisers, architects, professional 
4.15 	engineers, individuals licensed in the building trades, certified energy evaluators, 
4.16 	municipal truth-in-sale-of-housing or time-of-sale evaluators, and public employees. 
4.17 	However, to engage in home inspection in Minnesota, individuals must have a valid 
4.18 	Minnesota home inspector license.
4.19 		Subd. 3.Rules; qualifications for licensure. (a) The commissioner with the advice 
4.20 	and assistance of the council shall: (1) establish an application and evaluation process 
4.21 	for issuing home inspector licenses to qualified individuals according to requirements 
4.22 	established by the commissioner; (2) establish other reasonable requirements for licensing 
4.23 	to protect the public, home inspection clients, or the home inspector profession; (3) 
4.24 	establish rules to enforce penalties; and (4) establish other reasonable rules necessary to 
4.25 	achieve and enforce the intent of this chapter. No rule shall limit information related to a 
4.26 	home inspection that a home inspector may provide to a client.
4.27 	(b) The commissioner shall establish educational requirements for licensure and 
4.28 	continuing education requirements for home inspectors that include a minimum of 20 
4.29 	hours of yearly continuing education that is approved as to content by the council. A home 
4.30 	inspector must provide proof of attendance for license renewal.
4.31 	(c) The commissioner shall issue a home inspector license valid for up to two years 
4.32 	to an individual who submits truthful information as required by the commissioner and on 
4.33 	forms designed by the commissioner. The individual shall pay a fee equal to $25 for each 
4.34 	quarter of a calendar year the license is valid. The individual:
5.1 	(1) must have provided proof of passing a commissioner-approved examination that 
5.2 	met or exceeded the requirements of subdivision 1, paragraph (f), and proof of meeting the 
5.3 	continuing education requirements of paragraph (b) for license renewals;
5.4 	(2) must not have plead guilty, plead nolo contendere, or been convicted of a crime 
5.5 	related to home inspection;
5.6 	(3) must not have been adjudicated a predatory sex offender or other offender 
5.7 	required to be registered as described in section 243.166 or 244.052;
5.8 	(4) must be free from any unfulfilled penalty or disciplinary action described in 
5.9 	subdivision 4; and
5.10 	(5) must meet other requirements established by the commissioner according to 
5.11 	paragraph (a).
5.12 	(d) The commissioner shall maintain a public register of home inspectors, identifying 
5.13 	all currently and formerly licensed individuals and licensed individuals whose license is 
5.14 	under disciplinary action.
5.15 		Subd. 4.Prohibited acts and penalties. (a) A license may be denied, suspended, or 
5.16 	revoked, and/or a home inspector may be issued a public letter of reprimand or placed on 
5.17 	probation, until the reason for probation status is satisfied. 
5.18 	(b) If a majority of the entire council, after notice and hearing, determines an 
5.19 	individual has engaged in any one of the prohibited activities in clauses (1) to (14), the 
5.20 	disciplinary action in paragraph (a) may be enforced. If the individual:
5.21 	(1) claimed to be qualified to engage in home inspection in Minnesota without 
5.22 	having a valid Minnesota home inspector license;
5.23 	(2) agreed to engage in home inspection in Minnesota without having a valid 
5.24 	Minnesota home inspector license;
5.25 	(3) engaged in home inspection in Minnesota without having a valid Minnesota 
5.26 	home inspector license;
5.27 	(4) advertised or engaged in home inspection under another individual's name;
5.28 	(5) knowingly allowed the individual's license and name to be used by an unlicensed 
5.29 	individual while the other individual engaged in home inspection;
5.30 	(6) employed or supplied for employment an individual to perform a home 
5.31 	inspection in Minnesota who did not have a valid Minnesota home inspector license;
5.32 	(7) performed any act for which a Minnesota home inspector license is required after 
5.33 	expiration, revocation, or suspension of the license or during probation;
5.34 	(8) plead guilty to, plead nolo contendere to, or has been convicted of a crime related 
5.35 	to home inspection or a crime that would require registration as a predatory, sex, or other 
5.36 	offender described in section 243.166 or 244.052;
6.1 	(9) made a material misstatement in an application for a license or renewal of 
6.2 	a license;
6.3 	(10) advertised in a manner that is false, deceptive, or misleading;
6.4 	(11) performed a home inspection while the individual's ability was impaired by 
6.5 	alcohol or other legal or illegal drugs;
6.6 	(12) engaged in conduct while performing a home inspection that indicated a lack of 
6.7 	knowledge or ability to apply professional principles or skills;
6.8 	(13) performed a home inspection of a property for which the individual also acted 
6.9 	as a real estate appraiser, a real estate salesperson, real estate broker, or a loan officer; or
6.10 	(14) failed to provide a written home inspection report to a client by the date agreed 
6.11 	on by the home inspector and the client and for which the home inspector had been 
6.12 	compensated. 
6.13 		Subd. 5.Hearings and appeals. The commissioner, with or without technical 
6.14 	information or advice from the council, may hold hearings under chapter 14 on any matter 
6.15 	under the provisions of this section. Any person aggrieved by an order or decision of the 
6.16 	commissioner may appeal the order or decision according to the provisions of chapter 14.
6.17 		Subd. 6.Professional liability. All home inspectors shall carry a general liability 
6.18 	insurance policy in an amount determined by the commissioner with the advice and 
6.19 	assistance of the council. The general liability insurance policy shall provide that 
6.20 	cancellation or renewal of the policy shall not be effective until at least ten days' notice of 
6.21 	cancellation or renewal has been received in writing by the department.
6.22 		Subd. 7.Minnesota Home Inspector Technical Advisory Council. (a) The 
6.23 	Minnesota Home Inspector Technical Advisory Council is created under the jurisdiction 
6.24 	of the commissioner. The council shall advise the commissioner on matters relating to: 
6.25 	(1) the scope of home inspections; (2) home inspection capabilities; (3) home inspection 
6.26 	procedures and methods; (4) questions of materiality; (5) business ethics; (6) what 
6.27 	activities constitute engaging in or performing home inspection; and (7) other technical 
6.28 	matters determined by the commissioner.
6.29 	(b) The council shall consist of seven home inspectors appointed by the 
6.30 	commissioner no later than November 1, 2006.
6.31 	(c) Each council member must, at the time of appointment:
6.32 	(1) be a resident of the state of Minnesota and physically residing primarily in the 
6.33 	state of Minnesota;
6.34 	(2) be a home inspector licensed under subdivision 3, except the initial council 
6.35 	members, when first appointed, are not required to be licensed if they meet or exceed the 
6.36 	requirements for licensing under subdivision 3;
7.1 	(3) be able to communicate regularly by e-mail including receiving and sending 
7.2 	electronic documents; and
7.3 	(4) have performed home inspections in the state of Minnesota for at least five years 
7.4 	immediately preceding their appointment.
7.5 	(d) No later than 30 days after all members have been appointed to the council, the 
7.6 	council shall meet for the purpose of organizing by electing a chair and other officers as 
7.7 	the council finds necessary and appropriate.
7.8 	(e) The council shall meet at least semiannually on a date and at a time and place 
7.9 	determined by the council and at other times as may be specified upon the call of the 
7.10 	chair, the commissioner, or a majority of the council members. Participation in a meeting 
7.11 	by teleconference is authorized provided all participants can adequately hear all other 
7.12 	participants.
7.13 	(f) A majority of the current council members constitutes a quorum.
7.14 	(g) A council member who fails to attend three consecutive meetings, fails to attend 
7.15 	50 percent of all meetings during any calendar year, ceases to have primary residence 
7.16 	in Minnesota, or ceases to conduct home inspections is deemed to have resigned from 
7.17 	the council.
7.18 	(h) Council members' terms are two years, except that the initial council has four 
7.19 	members with terms of two years and three members with an initial term of one year.
7.20 	(i) Council members may not serve for more than two consecutive terms, except if 
7.21 	no successor has been appointed or approved, the member may continue to serve until a 
7.22 	successor is appointed or approved.
7.23 	(j) Council members shall not receive compensation for their services, but as 
7.24 	described in section 15.059 shall be reimbursed for necessary expenses incurred in the 
7.25 	performance of their duties and as approved by the commissioner.

7.26 	EFFECTIVE DATE. This section is effective the day following final enactment, 
7.27 	except section 326B.01, subdivision 2, is effective January 1, 2007. For individuals who 
7.28 	engage in home inspection within Minnesota prior to enactment of section 326B.01, this 
7.29 	section is effective July 1, 2007.