Need cash? Slap a magnet sign on your truck and say you’re a roofer. Forget the roof. This is Texas

By Dave Lieber, The Dallas Morning News

What happens after a monster storm? Storm chasers show up from who knows where and charm desperate homeowners in need of a new roof out of that first insurance check. Then it’s goodbye forever.

Texas is the only storm-prone state along the Gulf Coast that doesn’t make storm-chasing roofers touch a stitch of paperwork. This is embarrassing for Texas, and especially the governor and our Legislature, both of whom could easily fix this longstanding problem. Their inaction allows crimes to flourish.

Unlike hair cutters and plumbers and tow truck companies, no roofers’ license is required. No certification is demanded. There’s not even a state-sponsored website that offers a list of names, addresses and phone numbers of known honest, reliable roofers.

This type of theft happens every day of the year in Texas, and now there’s at least one guy saying enough is enough.

State Sen. Nathan Johnson, D-Dallas, has introduced Senate Bill 1481, which calls for a registration system for roofing companies who do post-storm work. For a minimal fee, these storm chasers would get listed on a state website.

The senator says, “You hand somebody $10,000, and you’re not able to look up whether or not they’re registered in the state and have a contact number.”

It’s notable that he mentions $10,000 because I spoke this week with Joe Dickens of Arlington, who gave his roofing company that amount. Then the roofers said goodbye forever. No roof for him.

“He took the money and ran off, OK?” Dickens says of former House of Tomorrow roofing company owner Jorge Garcia.

Dickens is still bitter about being a victim in a huge scheme involving more than 100 homeowners in Dallas, Arlington and Forth Worth. Victims lost a total of $500,000 in lost insurance claims.

For both Dickens and for me this matter is highly personal. We both discovered that storm-chasing roofers often behave as if they are members of a crime syndicate. In fact, my roofing experience changed my life.

The first roofer I hired after a hailstorm 15 years ago got confused and roofed the house behind me instead of mine. He tried to make my shocked neighbor pay anyway.

The second roofer I hired fixed my roof, but then declared bankruptcy, leaving almost a hundred other customers roofless. He was convicted of theft and served prison time.

After that experience, I studied what went wrong and what I could do to prevent it. This is why I created a consumer rights movement called Watchdog Nation that shows us how to protect ourselves. I was my own test case, and that’s how that experience changed my life.

Ever since, I’ve watched storm-chasers pulling off their cons and nothing is done. This is considered normal in Texas, and it was reflected in an eye-opening video posted the other day by the Texas Department of Insurance. The video, called “Winter storm webinar,” is available on YouTube. It was supposed to be a primer on how to handle insurance claims like busted water pipes caused by the February storms.

But something surprising happened in this video. Members of the public hijacked the discussion away from burst pipes to pleas for advice on how to find honest roofers.

The hashtags for the video are #insurance #storm #disaster. But they should be changed to #roofers #scams #disaster. Here are the public’s questions, and the insurance department’s answers.

Do contractors have to be licensed in Texas? (No.)

Is there a way to see if a contractor has been involved in fraud? (Nothing official.)

Is it OK to ask to see their driver’s license? (Brilliant idea.)

Is there a place I can get information about my contractor for my piece of mind? (Check search engines to background the roofer.)

Is there a directory we can use to find good contractors? (Again, nothing official.)

How can we stop unsolicited phone calls and roofers coming to my door? (The calls are illegal, and little can be done. For door-knockers, TDI says ask to see their solicitor’s permit. If they don’t have one, call the cops.)

How can I do a criminal background check on a contractor and his staff? (Try a for-pay website.)

You can see from these questions what concerns the public. All of this could be solved with Sen. Johnson’s Senate Bill 1481, and its companion in House Bill 2777.

The bills require re-roofers (those repairing existing roofs) to register their company’s name with contact information. Any bad behavior would be reported. Violators could face a $500 civil penalty.

But the same lawmaker who killed the roofers bill in 2019 has told the state’s roofers association that he vows to do it again.

Rep. Ramon Romero Jr., D-Fort Worth, stomped on the bill two years ago like it was a snake that tried to bite him.

Romero would not talk to The Watchdog this week. But in 2019 when I profiled his stomping, he told me one reason he objected was because the bill’s author was not a contractor. “It really needs to be a contractor,” he said. (Did I mention Romero is a contractor?)

Truth is anybody can introduce a bill. But thanks to Romero, two years ago, the bill lost a 99-33 House vote. Since then, more Texans have been ripped off. I blame him.

Sarah Burns, who runs the Roofing Contractors Association of Texas, told me, Romero has “already made it abundantly clear that he intends to do the same in this session.”

Before talking to me, Burns said she was on the phone with a San Antonio homeowner.

“They hired the cheap guy,” she said, “and now they’ve got a $40,000 metal roof, and it leaks all over the place. They’re going to have to move out.”

If you’re wondering why this registry is such a problem, it plays into the notion, pushed hard by Gov. Greg Abbott and others, that we shouldn’t do anything that hurts business. And how about consumers? Meh.

“I understand we like Texas,” Burns says. “The reason we’re here is because we don’t want government in our business. But, unfortunately, this is a situation with no recourse for consumers.”

Johnson says his bill has a chance this year because the October 2019 Dallas tornado drew added attention to the crime spree. His bill awaits a hearing in the Senate Business & Commerce Committee. (Want to help? Call chairman Kelly Hancock, R-North Richland Hills, and say “Let’s move on SB 1481.” His office is 512-463-0109.)

The similar House Bill 2777 could use your help, too. It’s stuck in the House Business & Industry Committee, where chairman Chris Turner, D-Grand Prairie, released a statement to The Watchdog, saying: “In terms of this specific measure, I have not reviewed it, but I support efforts to reform the roofing industry to better protect consumers.” (Want to help? Promote HB 2777 for a hearing. Turner’s office is: 512-463-0574.)

Remember our victim, Dickens? Other victims were not as fortunate as the Arlington homeowner who lost $10,000. NBC5 did a report on his plight. That changed everything.

“You’re not going to believe this,” he says. “After that, a roofing company contacted me. There was a good Samaritan. He donated my roof. Who that individual was I have no idea, but I would love to sit down, shake his hand and have a cup of coffee with him.”

What an embarrassment. It takes an unknown angel to make up for what the Texas Legislature won’t do for its own people.

Off with their heads?

Dear friend –

The storm shut us all into our homes for a week (after a year of pandemic semi-isolation, no less). For millions it imposed sustained freezing cold and darkness, even lack of water, along with all the awful consequences. When the power finally came back and the artic dome at last left us to thaw, indoor water pipes burst, flooding homes and buildings, adding to the financial, physical, and emotional toll. It was the 4th-worst Texas winter storm on record.

It’s tempting to call for heads to roll. We want someone to blame for all this. But beware rolling heads, for in our overzealous search for personal fault we will almost certainly miss the larger, structural and systemic causes of failure and loss. And that leads to mistakes we can’t afford.

Which brings me back to those pipes. Why did they burst? Because they weren’t designed to accommodate or withstand subfreezing indoor temperatures. What happened with our energy system is sort of like what happened to the pipes: it wasn’t able to function in the conditions that it wasn’t designed to operate in.

Last week the House and Senate convened hearings to investigate what went wrong. For 14 hours on Thursday and 10 hours on Friday, my Senate Business & Commerce committee colleagues and I questioned witnesses from the panoply of players in the energy supply sector – ERCOT, PUC, RRC, TDUs, REPs, and other acronyms, as well as industry executives, advocates and scientists.

We have a great deal of work ahead. Much remains to be analyzed and explored. But the hearings made abundantly clear that sole blame cannot rightly be placed on a few individuals at ERCOT or the PUC or elsewhere. That’s dangerously simplistic. I’ll be working on the harder questions.

TXMedX

This morning I released a new video, Cutting Through the Fog, in which I use animated drawings and a white board (and a little dry ice) to explain the math and the benefits of Medicaid expansion. The 10-minute video offers an entertaining look at how Medicaid expansion works for Texas, and calls upon all Texans – Republican, Democrat, urban, and rural – to learn the facts and advocate for immediate expansion. “We absolutely have to cut through the partisan fog. It’s time to get this done.”

Click here to watch the 30-second trailer, or click the image to view the full video. 

The 87th Texas Legislature

Dear friend –

We’re now two weeks into the 87th Texas Legislative Session. The Capitol is abuzz with excitement, and maybe with a bit of intrigue, too. Possibilities abound.

What’s new: My team and I begin this new year in a new Capitol office, and with a new set of committee assignments. The Lieutenant Governor appointed me to serve as Vice-Chair of the Senate Committee on Administration, and on Business and Commerce, Jurisprudence, the Senate Special Committee on Redistricting, and Water, Agriculture, and Rural Affairs. These are weighty assignments, and I embrace them eagerly and with high aspirations.  

What’s continuing: My work in the healthcare space, meanwhile, will continue unabated. I have filed several healthcare bills already, none larger or more important than the quest to forge a bipartisan agreement to bring to Texas expanded Medicaid coverage under the Affordable Care Act. Please take a moment to read the Policy Spotlight: “Live Well Texas Program”, below.

Top response from my January 19th Town Hall: “I had no idea state government did so much.” Missed it? Curious? You can watch the whole show here. Warning: I talk too fast. There was a lot to cover.

Podcast fans: Jason Whitely and Jason Wheeler brought me onto their smart and entertaining show Y’all-itics last week, for a quick look at a few of the big items looming ahead for the session – the state budget, the startling scope and scale of benefits from Medicaid expansion, schools and property tax, marijuana, partisanship, and more. Catch the segment here, or for a quick sense of the show, listen to this 1-minute clip.

Want to follow state politics in real time? You can watch committee hearings as well as Senate and House floor proceedings, and even track legislation in progress, at https://capitol.texas.gov/.

Policy Spotlight: The Live Well Texas Program

The opportunity. We can bring health insurance to an estimated million Texans while adding $2.5 billion dollars to state general revenue without raising taxes. At the same time we can provide support to rural and urban health systems, stabilize family finances, improve public health, decrease ER visits, relieve pressure on local property taxes, improve racial equity, encourage employment and create jobs.

All this results from expanding health insurance coverage under the Affordable Care Act. But despite the benefits, ACA expansion still faces significant obstacles in Texas – political, practical, and philosophical. To overcome these obstacles, we’ll have to address long-standing and valid conservative concerns, while still meeting the challenge to broadly expand access to healthcare. That’s the aim of my Senate Bill 117, the “Live Well Texas” program.

The Live Well Texas program is neither traditional Medicaid nor traditional Medicaid expansion. In fact, it’s a waiver of substantial elements of traditional Medicaid requirements. The program draws down federal Medicaid dollars to provide coverage to the ACA “expansion” population (non-elderly, non-disabled, non-pregnant adults age 19-64 who earn less than 138% of the federal poverty level), but gives Texas substantially more control and discretion over how we administer and spend those funds, over how we work with providers, payers, and participants. Importantly, the program incorporates approaches that have proven effective in other states with Republican leadership. As with other comprehensive bills, SB 117 also provides a flexible framework within which legislators can change, add, subtract, re-shape, and refine the various elements and operations of coverage expansion.

What about the money? We’re good on the money. Because it draws down federal Medicaid dollars at a federal-state match rate of $90-$10 (instead of $60-$40 under standard Medicaid), a Texas ACA expansion generates more in savings and revenue ($1.4B) than it introduces in new costs ($1.3B). See, among other sources, An Open Letter to Elected Officials, November 9, 2020 by Ray Perryman, Laura Dague, Randy Fritz, and Vivian Ho: “[T]he probable net static fiscal impact of implementing a federally funded expansion in Texas would be positive and in the range of $75 million to $125 million during the 2022-2023 Biennium.”

And that’s just the static component. Economic stimulus from an additional $11B in federal funding is expected to generate additional dynamic state revenue of $2.5B, and local revenue of $2.0B – in just the first fiscal biennium.

Finally, if – as virtually all other expansion states have done – Texas were to implement any kind of provider or plan assessments, fees, or taxes, the resulting revenue would be available for other state needs.

$90-$10 or failure. The money math only works with a $90-$10 federal-state match. Calls for “alternatives” to ACA expansion propose exceedingly narrow, incremental, but politically attractive programs. They cover a small fraction of the expansion population, generally draw funding at $60-$40, and depend on local property taxes. The money math doesn’t work, and they’ll get a negative “fiscal note”, which in the Legislature means they impose net cost to the state budget, which in turn means that they won’t become law. In practical effect, then, there are only two options: $90-$10 or failure.

Does expansion mean less efficiency in government? No. The present structure of healthcare assistance programs is fragmented, comprising a large and complex patchwork and featuring inconsistencies and contradictions and leaving large gaps. To an appreciable extent, ACA expansion can streamline processes and consolidate operations, resulting in greater, not lower, government efficiency.

An overview of Live Well Texas. Some key elements of the plan include:

• Health savings accounts. Participants are enrolled in a high deductible health plan. The state initially funds the account in an amount equal to the (high) deductible or, in the case of the plan option for advanced benefits, in the deductible amount minus the amount the participant will be expected to contribute to their own health savings account. For low-wage workers, the participant’s contribution may be funded by the participant’s employer (incentivizing both employment and employer participation) or by charitable organizations (calling upon and enabling the participation of the community).

• Provider participation incentive: raises Medicaid reimbursement rates to parity with Medicare rates. Higher reimbursement rates correlate to higher provider participation.

• Utilizes Texas’ existing MCO model, including value-based payment systems.

• Creates incentives for healthy behavior modifications. Insurers (MCOs) can reward participants for healthy behavior modifications, like smoking cessation and chronic disease management, by making extra contributions to their HSA accounts.

• Medicaid residency and citizenship requirements apply to plan eligibility.

• Encourages and facilitates employment. The plan refers unemployed and under-employed participants to work-search and job-training programs provided by the state. Participants who do secure employment and then, as a result of their additional income become ineligible for the program, may continue to draw upon their HSA account funds while they obtain new insurance, thus eliminating what otherwise might be a disincentive for seeking employment.

• Simplifies eligibility. Uses a single, consolidated application process for all state health benefit programs, including current Medicaid and the Live Well Texas program. Once an applicant is determined to be eligible, eligibility continues for 12 months.

• Continuity of enrollment, and maximum federal funding for pregnant women, parents and caregivers. To the extent standard Medicaid for pregnant women might (now or in the future) provide benefits beyond what the Live Well Texas program offers them, women who become eligible for traditional Medicaid by virtue of pregnancy will receive all standard Medicaid benefits in addition to their benefits under their plan. The program treats parents and caregivers likewise. This ensures that participants receive all benefits that the state has specifically designed for pregnant women and caretakers. At the same time it incentivizes them to remain enrolled in the Live Well Texas program, which for the state means federal funding at $90-$10 instead of $60-$40 (or other less favorable rate) under traditional Medicaid.

• Self-destruct: if the federal government were to decrease the $90-$10 match rate, the program ends.

Expansion under the ACA is stable. With 38 states having opted to expand under the ACA, representing 228 million people and 53 million expansion enrollees, we can expect that Congress will preserve it, just as Congress continues to provide funding for transportation and education.

More to do. Coverage expansion under the Live Well Texas program (or other ACA $90-$10 expansion model) comprises only part of the exciting range of healthcare initiatives being pursued at this moment. Some will advance this session (pushing for a few of my own), and some will have to wait for other legislative sessions. But ACA coverage expansion is by far the most comprehensive, powerful, and economically advantageous measure available to Texas.