When Richard Hanson drew up the design for his $45,261 resort-style pool, he envisioned a horseshoe-shaped masterpiece, complete with a swim-up bar.
What he got came up far short of what he expected - and of what the Arizona Registrar of Contractors said he had a right to expect.
Although the pool looks good from a distance, it's plagued with problems that make it almost unusable.
Hanson was protected. By using a state licensed contractor, he is eligible to collect from a special fund for victims of shoddy work.
But nearly three years after filing his initial complaint he has yet to receive any money - nor is he likely to anytime soon - because the fund is all but broke.
And he's just one of more than 700 Arizonans waiting to recover from that fund.
Hanson's pool, built by Whitewater Pools and Spas, sits in disrepair, rust gathering on the bottom "like measles spots," the vents and plaster stained and corroded. The swim-up bar is "drastically off-center," and an underwater abutment can scrape or bruise swimmers, Hanson says.
The water in the pool may look pretty, but that's "very deceptive," he adds. Because of problems with a non-chlorine system he bought from Whitewater, "they told me to put 53 gallons of muriatic acid and 104 pounds of calcium in the pool," says Hanson, 66. "I have some very serious pH problems."
Both Hanson and the Registrar of Contractors fault Whitewater, which went out of business in September 2008, for a myriad of construction mistakes. Efforts to locate Whitewater representatives for comment were unsuccessful.
It's likely Hanson will have to keep waiting to collect on his claim, said Tyler Palmer, spokes-man for the Arizona Registrar of Contractors.
Over the past two budget cycles the Arizona Legislature seized $8.4 million from the Arizona Registrar of Contractor's Recovery Fund, using the money to make up for state shortages elsewhere. The fund had about $12 million in it just two years ago.
Such sweeps have kept the registrar from using the money to benefit victims, said Bill Mundell, Arizona Registrar of Contractors director.
"According to the statute, this fund was established to be held in trust for the purpose of funding deserving homeowners," Mundell said. "Held in trust - that's pretty strong language, don't you think?"
Currently, the Arizona Registrar of Contractors Recovery Fund has verified claims totaling $8.8 million to be paid to some 760 homeowners.
Paying out those claims would be nothing short of impossible at this time, Palmer said, because by Jan. 31 only $1.4 million remained in the fund.
And with projected revenues for fiscal year 2011 falling short this year, things likely won't get better anytime soon.
The registrar does not award homeowners' claims that exceed $30,000.
The fund receives no taxpayer money. Its only source of revenue is contractors who've paid into it, Palmer said, and "right now we are seeing fewer contractors and less money into the fund."
Under the Recovery Fund, contractors who opt to pay a $150 fee annually receive a consumer protection bond that's good for up to $200,000.
Because of the savings, most licensed contractors choose to purchase the bond via the Arizona Registrar of Contractors, rather than making a cash deposit of $200,000 or purchasing a $200,000 surety bond, Palmer said.
But with the Recovery Fund sinking to an all-time low, there are discussions about increasing the fee.
"I think increasing the fee would be a last resort, especially in this economy," said Mundell, who can seek other sources of revenue when the Recovery Fund drops below $2 million.
Mundell says increasing the fee could put an additional burden on contractors, who already pay licensure bonds and fees.
But some homeowners who have been waiting to receive Recovery Fund monies feel the registrar needs to take action immediately.
Rachel Hopkins and her husband custom-designed their dream home in 2005, only to find that a stucco-like substance used on the exterior was giving way in 2007.
"We have cracks on the corners of our windows," said Hopkins. "There's a parapet that's cracked on the top of the house."
Hopkins filed an initial complaint with the registrar in June 2007. But by the time her investigation was complete, it was 2009 and her contractor had had both his commercial and residential licenses revoked. Hopkins was told she wouldn't hear back from the registrar about the amount she'd been awarded until May.
Hopkins says the process has taken far too long, and the registrar and Legislature "should either do what they say they are going to do with the fund or just do away with it."
Hanson, whose pool continues to rust, voices similar frustration.
"I think this is an extremely dangerous precedent for lawmakers to totally circumvent the normal legislative process and raid these funds because of a budget crisis," said Hanson. "In doing so, they're showing contempt for the taxpayer."
As revenue dwindles and the effects of legislative fund grabs set in, Palmer said, the registrar has been forced to reduce its Recovery Fund staff from about 10 employees last year to seven this year.
Palmer and Mundell fear if additional sweeps take place, the Recovery Fund won't be sustainable.
DID YOU KNOW
Licensure in the state of Arizona is required for any job that exceeds $1,000.
The Arizona Registrar of Contractors recommends homeowners not hire a single contractor for a job that exceeds $30,000.
To verify that a contractor is registered, go to www.azroc.gov
Contact reporter Megan Neighbor at 307-0579 or mneighbor@azstarnet.com
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