To Catch a Contractor

Changes proposed to improve homeowner access to state fund following NBC10 Boston investigation

Our award-winning “To Catch a Contractor” series is getting results, with proposed changes to a state program meant to help consumers if they get ripped off during a home improvement project. Last year, we told you how homeowners experienced frustrating denials and bureaucratic red tap when they applied for funds.

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Our reporting is putting thousands of dollars from a state program back into the pockets of homeowners who have been ripped off.

The Newton, Massachusetts, home that Ariel Dowling and husband Aron Levin purchased a couple of years ago had many of the characteristics they were looking for during their search, including a community feel and walkability to shops, restaurants and their kids’ elementary school.

But at 100 years old, the house was in need of some updating to make it more functional for the family of five.

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After getting several bids and checking references, the couple hired a contractor to perform the six-figure renovation project. At first, things seemed to be going smoothly and the project hummed along at a steady pace.

However, weeks started going by without hearing from the contractor or seeing a worker at the property. By October 2022, communication was nonexistent.

“He just stopped responding. He stopped calling,” Dowling recalled. “It was like he disappeared into the ether. Just gone.”

At that point, the home was unlivable. There was not a single functioning bathroom and the kitchen was completely ripped out.

As they continued renting a property in Cambridge and driving their kids each day to school in Newton, the couple scrambled to find another contractor who could finish the job.

“It was a huge financial headache,” Dowling said.

The couple took the contractor to court and won a substantial civil judgment. That’s when they tried to get some relief from the Guaranty Fund, a state program meant to help homeowners when they get ripped off by a registered home improvement contractor.

However, after submitting the stacks of paperwork, the couple’s case was dismissed.

The reason? For estate planning purposes, they had moved their home into a trust for their three young kids. According to the communication they received from the state agency, that meant they no longer fit the definition of owners of the property.

“What do you mean I don’t own the house?” Dowling remembers thinking when she received the news. “I signed a million documents for it. I put my name down. I’m on the deed. How could we possibly not own this house?”

Russ and Beth Carman know that feeling all too well. As we told you last year, the couple lost more than $20,000 on a kitchen renovation project at their Wakefield home.

The elderly couple also got a rejection letter for the same reason of moving their property into a trust.

“It’s frustrating. I’m angry. I’m sad,” Beth Carman told us when we interviewed her about the experience.

Add those stories to the list of issues we’ve uncovered with the Guaranty Fund during our ongoing "To Catch a Contractor" investigative series.

The NBC10 Boston Investigators have uncovered a contractor’s path of destruction across Massachusetts. Homeowners paid big bucks for pools and other home improvement projects, but were left with giant holes in their backyards and broken promises.

Consumers have described a process plagued by mountains of paperwork and bureaucratic red tape.

"The program is a joke. It's not for the consumer," one homeowner told us when it took several years before he received his approved payment.

Layla D'Emilia is the undersecretary of the Office of Consumer Affairs and Business Regulation. She promised an internal review of the program when we first presented some of our findings last year.

That review has already resulted in the reversal of 22 recent cases that had been rejected for reasons like the residential trust or a requirement to serve a contractor with a civil judgement in hand.

The reversed cases allowed homeowners to pursue a combined $427,000 claims from the Guaranty Fund.

"What I wanted to do when I look at it is just take a whole new approach," D'Emilia said. "We acknowledge that consumers have had a real hardship in obtaining access for a program that is for them."

Only a fraction of the funds intended to help consumers recruit money if they get ripped off are being paid out.

Other changes like streamlining the process, modernizing the system with online applications, hiring more arbitrators, and strengthening enforcement against contractors are being proposed to lawmakers.

Most notably, the claim payout would be increased to a maximum of $25,000.

Our reporting found the $10,000 cap hadn’t been adjusted for inflation since the law took effect in the early 1990s.

As a result, the fund had only paid out a fraction of the revenue it generated each year as the balance ballooned all the way up to $4.4 million, according to the most recent budget figures we obtained.

"This was a total renovation," D'Emilia said. "It's really important that folks are able to utilize the program for not only the bad things that happen, but also to prevent bad actors from defrauding them."

The changes are included in Gov. Healey's economic development bill, which is scheduled for a hearing on Tuesday at the State House.

Homeowners like Dowling, the Newton homeowner, are glad they spoke up to NBC10 Boston about their frustrating ordeals and that somebody actually listened.

"Anything they can do to benefit and help people out of a situation they are extremely unhappy to be in is just a benefit to the community and Massachusetts as a whole," she said.

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