Legislators say they have tried to protect homebuyers from subcontractor liens, but most measures were not passed because they were not practical or because of industry pressure.
"I sponsored a bill to require the home builder to have all liens cleared on the home before he could sell it," said Sen. Rex Black, D-Salt Lake. "But they put it in the Business and Labor Interim Committee for study, and I don't know if it ever got studied or not."Black said attempts to bring tougher requirements on home builders and subcontractors to protect homebuyers often face tough opposition from legislators and the contracting industry.
About a dozen lawmakers are associated with the building industry, either as contractors, developers or real estate salesmen.
Sen. Craig Peterson, R-Orem, who sponsored a similar bill that failed in 1987, said in retrospect the idea was flawed.
Because of the typical billing cycle, he said, the home builder may not receive a bill from a subcontractor until 60 days after the work is begun.
"If the bill had to be paid before the home could be sold, you may have a completed home sitting there vacant for two months," he said.
Dozens of homebuyers in the Alta Canyon subdivision in Sandy have had liens placed on their homes because developer Jim Jenkins has not paid tens of thousands of dollars in bills submitted by his subcontractors.
One subcontractor says the state refuses to require contractors to carry bonds to protect their buyers because of the strong influence from contractors' lobbyists.
Senate President Arnold Christensen, a Sandy electrical contractor, said the state has been reluctant to require bonds because of the high costs for most small contractors.
Peterson said he helped sponsor a law in 1989 that makes it a criminal offense for a contractor to spend funds from the sale of a home before paying the subcontractors.
A developer in Utah County is facing 18 felony counts under that law, he said, and the charges have had a sobering effect on other builders.