registrar of contractors

SB1679 - 572R - I Ver

REFERENCE TITLE:
registrar of contractors

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SB 1679

Introduced by

Senator
Dunn

AN
ACT

Amending sections 32-1104, 32-1122, 32-1124,
32-1125, 32-1133, 32-1133.01, 32-1155, 32-1157 and 32-1161, Arizona
Revised Statutes; relating to the registrar of contractors.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 32-1104, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1104.

Powers and duties

A. The registrar, in addition to other duties and
rights provided for in this chapter, shall:

1. Maintain an office in Phoenix and in such other
cities and towns in
the
this
state
as the registrar deems advisable and necessary.

2. Maintain a complete indexed record of all
applications and licenses
that are
issued, renewed,
terminated,
cancelled
canceled
,
revoked or suspended under this chapter, including timely notation of any
judicial disposition on appeal, for a period of
not less than
at least
seven years.

3. Furnish a certified copy of any license
that is
issued or an affidavit that no license exists or that a
license has been
cancelled
canceled

or suspended, including information as to the status on appeal of such a
cancellation or suspension, on receipt of the prescribed fee, and that
certified copy or affidavit shall be received in all courts and elsewhere as
prima facie evidence of the facts stated therein. The registrar
shall also furnish certified copies of license bonds or cash deposit
certificates on receipt of the prescribed fee. Fees charged pursuant
to this paragraph are $10 per hour, except that the minimum fee charged
pursuant to this paragraph is $10.

4. Employ such deputies, investigators and
assistants subject to title 41, chapter 4, article 4, and procure such
equipment and records, as are necessary to enforce this
chapter. With respect to the enforcement of section 32-1164,
the registrar or the registrar's investigators are vested with the authority to
issue a citation to any violators of this chapter in accordance with section 13-3903. When
the registrar or the registrar's investigators conduct investigations they are
authorized to receive criminal history record information from the department
of public safety and other law enforcement agencies.

5. Make rules the registrar deems necessary to
effectually carry out the provisions and intent of this
chapter. Such rules shall include the adoption of minimum standards
for good and workmanlike construction. In adopting such rules of minimum
standards, the registrar shall be guided by established usage and procedure as
found in the construction business in this state. If the rules of
minimum standards adopted by the registrar are in any manner inconsistent with
a building or other code of this state
,

or
a county, city or other political subdivision or local
authority of this state, compliance with such code shall constitute good and
workmanlike construction for the purposes of this chapter.

6. Apply the following to proposed rule changes:

(a) The registrar of contractors, at the time the
registrar files
a
notice of proposed rule change with the
secretary of state in compliance with title 41, chapter 6, shall mail to each
trade association that qualifies in accordance with subdivision (b) of this
paragraph, and any other individual holding a bona fide contractor's license
who qualifies in accordance with subdivision (b) of this paragraph, a copy of
the notice of proposed rule change.

(b) Every trade association in this state allied
with the contracting business that files a written request that a notice be
mailed to it and shows that the association has an interest in the rules of the
registrar of contractors shall receive a copy thereof, as set forth in
subdivision (a) of this paragraph.� Such filing of a request may be made every
two years
,
and
it
shall contain
information as to the nature of the association and its mailing address.� Any
duly licensed contractor who files a written request shall receive a copy of
the proposed rule changes in accordance with this paragraph. Each
such request may be made every two years.

7. Prepare and furnish decals and business
management books when deemed advisable by the registrar.� A reasonable fee may
be charged for such decals and business management books.

8. Refer criminal violations of this chapter to the
appropriate law enforcement agency or prosecuting authority.

B. The registrar may develop and institute programs
to do any of the following:

1. Educate the public and contractors licensed
pursuant to this chapter regarding statutes, rules, policies and operations of
the agency.

2. Assist in resolving disputes in an informal
process before a reportable written complaint is filed. The
registrar must notify the licensed contractor in an alleged dispute before a
written complaint is filed and allow the contractor the opportunity to be
present at any inspection regarding the alleged dispute. The
registrar must give the contractor at least five days' notice before the
inspection.� Issues in the alleged dispute under this section shall not be
limited in number and shall not be considered formal written
complaints. The homeowner reserves the right to deny access to the
contractor under this informal complaint process. The registrar must
notify the contractor and the homeowner in writing of the registrar's findings
within five days after the date of the inspection.� The registrar may not post
any information regarding the informal complaint process as part of a
licensee's record on the registrar's website.

3. Develop, manage, operate and sponsor
construction related
construction-related

programs
that are
designed to benefit the public in
conjunction with other private and public entities.

C. The registrar shall publicly post a
list of applicants for a contractor license on its website for at least twenty
days, commencing on the day designated by the registrar.� The registrar shall
issue a license if the applicant meets all requirements regardless of the
twenty-day posting period.� The registrar shall furnish copies of the
posting list on written request.� A reasonable charge, not to exceed $2 per
month, may be made for compilation, printing and postage for the posting list.�
The list shall contain the following information:

1. The name and address of the
applicant.

2. The names, addresses and official
capacity of all persons required to sign the application under section 32-1122.

D.

c.
The
registrar may accept voluntary gifts, grants or matching monies from public
agencies or enterprises for the conduct of programs that are authorized by this
section or that are consistent with the purpose of this chapter.
END_STATUTE

Sec. 2. Section 32-1122, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1122.
Duties of registrar; qualifications for license; examination;
fingerprinting

A. A contractor's license may be issued only by act
of the registrar of contractors. The registrar shall:

1. Classify and qualify applicants for a license.

2. If necessary, change the license classification
of a licensee in the case of a title reclassification, with or without a bond
rider for the purpose of continuing liability on the bond.

3. Conduct investigations the registrar deems
necessary.

4. Establish written examinations to protect the
health and safety of the public.

B. To obtain, renew or maintain a license under this
chapter, the applicant or licensee shall:

1. Submit to the registrar of contractors a verified
application on forms that are prescribed by the registrar of contractors and
that contain the following information:

(a) A designation of the classification of license
that is sought by the applicant.

(b) If the applicant is a sole proprietorship, the
applicant's name and address.

(c) If the applicant is a partnership, the names and
addresses of all partners with a designation of any limited partners.

(d) If the applicant is a limited liability company,
the names and addresses of all of the following, as applicable:

(i) If the applicant is a manager-managed
limited liability company, all managers.

(ii) If the applicant is a member-managed
limited liability company, all members.

(iii) All owners of twenty-five percent or
more of the stock or beneficial interest.

(e) If the applicant is a corporation, an
association or any other organization, the names and addresses of all of the
following:

(i) The president, vice president, secretary and
treasurer or the names and addresses of the functional equivalent of all of
these officers.

(ii) The directors.

(iii) The owners of twenty-five percent or
more of the stock or beneficial interest.

(f) The name and address of the qualifying party.

(g) If the applicant is a limited liability company
or corporation, an attestation that the limited liability company or
corporation is in good standing with the corporation commission.

(h) The address or location of the applicant's place
of business and the mailing address if it is different from the applicant's
place of business.

(i) An attestation that the applicant has complied
with the statutes and rules governing workers' compensation
insurance. If the applicant is required by law to secure workers'
compensation insurance pursuant to title 23, chapter 6, the attestation must
contain the workers' compensation insurance policy number or be accompanied by
proof of self-insurance.

(j) If the applicant is a trust, the names and
addresses of all trustees.

2. Submit the appropriate fee required under this
chapter.

3. Submit and maintain the appropriate bond required
under this chapter.

4. Notify the registrar of any change in the
information required by this section within thirty days after the change
occurs.

C. To obtain, renew or maintain a license under this
chapter, each person who is named on a license must not have engaged in
contracting without a license or committed any act that, if committed or done
by any licensed contractor, would be grounds for suspension or revocation of a
contractor's license or be named on a license that was suspended or revoked in
this state or another state
,

unless the
act did not result in a loss that has been fully satisfied pursuant to section
32-1161
.

D. To obtain a license under this chapter, a person
may not have had a license denied
, refused
or revoked
within one year before the person's application. The registrar may
find circumstances behind the denial
, refusal
or
revocation excusable if the applicant's actions did not result in an unremedied
hardship or danger or loss to the public. A person who has been
convicted of contracting without a license is not eligible to obtain a license
under this chapter for one year after the date of the last conviction.

E. Before a license is issued, the qualifying party
must:

1. Have a minimum of four years' practical or
management trade experience, at least two of which must have been within the
last ten years, dealing specifically with the type of construction, or its
equivalent, for which the applicant is applying for a
license. Technical training in an accredited college or university
or in a manufacturer's accredited training program may be substituted for a
portion of such experience, but in no case may credited technical training
exceed two years of the required four years' experience. The
registrar of contractors may reduce the four years' practical or management
experience requirement if in the registrar's opinion it has been conclusively
shown by custom and usage in the particular industry or craft involved that the
four-year requirement is excessive. The registrar shall waive the
work experience documentation and verification if the records reflect that the
qualifying party is currently or has previously been a qualifying party for a
licensee in this state in the same classification and meets all other
qualifications.

2. Successfully show, by written examination taken
not more than two years before application, if required, qualification in the
kind of work for which the applicant proposes to contract, the applicant's
general knowledge of the building, safety, health and lien laws of the state,
administrative principles of the contracting business and the rules adopted by
the registrar of contractors pursuant to this chapter, demonstrate knowledge
and understanding of construction plans and specifications applicable to the
particular industry or craft and of the standards of construction work and
techniques and practices in the particular industry or craft and demonstrate a
general understanding of other related construction trades, in addition to any
other matters as may be deemed appropriate by the registrar to determine that
the qualifying party meets the requirements of this chapter.

F. The registrar shall maintain multiple versions of
examinations for each type of license that requires an
examination. The registrar shall waive the examination requirement
if the records reflect that the qualifying party is currently or has previously
been a qualifying party for a licensee in this state in the same classification
within the preceding five years.

G. A license may not be issued to a minor, to any
partnership in which one of the partners is a minor or to any corporation in
which a corporate officer is a minor.

H. Before receiving, renewing and holding a license
pursuant to this chapter, the registrar may require a license applicant or
licensee to submit to the registrar a full set of fingerprints and the fees
required in section 41-1750
or submit to a criminal
background check
. The registrar shall submit the fingerprints
and fees to the department of public safety for the purpose of obtaining a
state and federal criminal records check pursuant to section 41-1750 and
Public Law 92-544.� The department of public safety may exchange this
fingerprint data with the federal bureau of investigation.
END_STATUTE

Sec. 3. Section 32-1124, Arizona Revised Statutes, is amended to read:

START_STATUTE
32-1124.

License issuance; required posting and placement; license
suspension

A. When the registrar receives the fee required by
this chapter and an application furnishing complete information as required by
the registrar, the registrar shall notify the applicant within sixty days after
the date of the filing of a complete application of the action taken on the
application
.
, and
If the registrar
determines that the applicant is qualified to hold a license in accordance with
this chapter, the registrar shall issue a license to the applicant allowing the
applicant to engage in business as a contractor under the terms of this
chapter.

B. Licenses issued under this chapter and any
renewals shall be signed
by the registrar or the registrar's
designated representative and
by the licensee. The license is
nontransferable
, and satisfactory evidence of possession shall be
exhibited by the licensee on demand
. The license number
appearing on any licenses held by the licensee must be preceded by the acronym
"ROC" and shall be posted or placed as follows:

1. In a conspicuous place on premises where any work
is being performed.

2. On all written bids and estimates submitted by
the licensee.

3. On all published advertising, letterheads and
other documents used by the licensee to correspond with the licensee's
customers or potential customers in
the conduct of
CONDUCTING
business regulated by this chapter
,

unless the broadcast, internet or billboard ADVERTISing includes
a website's uniform resource locator that directly links to a website that
prominently displays the licensee's name and license number
.

4. On all broadcast, internet or billboard
advertising, unless the broadcast, internet or billboard advertising includes a
website's uniform resource locator that directly links to a website that
prominently displays the licensee's name and license number.

C. A violation of subsection B of this section
relating to posting and placement of license numbers shall be, at the
discretion of the registrar, grounds for disciplinary action pursuant to
section 32-1154, subsection A, paragraph 12, but not grounds for
preventing the award of a contract, voiding an awarded contract, or
constituting
any other claim or defense against the
licensee. For the purposes of
this
subsection
b of this section
, advertising does not include a trade
association directory listing that is distributed solely to the members of the
association and not to the general public.

D. If an application for a license is denied for any
reason provided in this chapter, the application fee paid by the applicant is
forfeited and shall be deposited pursuant to section 32-1107. A
reapplication for a license shall be accompanied by the fee fixed by this
chapter.

E. On issuance or renewal of a license, the
registrar, at the request of a licensee, shall issue a
single

license certificate showing all contracting licenses held by the licensee that
are currently in good standing and their dates of expiration.

F. The registrar may establish procedures to allow a
licensee to establish a common expiration or renewal date for all licenses
issued to the licensee and may provide for proration of license fees for that
purpose.

G. The registrar may suspend by operation of law a
license issued under this chapter if any of the following occurs:

1. The licensed entity is dissolved. The
dissolution of the licensed entity includes the death of a sole owner, a change
to the partnership by either adding or removing a partner, the revocation or
dissolution of corporate authority or the dissolution of a limited liability
company or limited liability partnership.

2. The licensed entity does not have authority to do
business in this state.

3. The license is obtained or renewed with an
insufficient funds check. The license remains suspended until the
registrar receives sufficient funds as payment for the license fees and
assessments.
END_STATUTE

Sec. 4. Section 32-1125, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1125.

Renewal of license; qualifying party

A. Except as provided in section 32-4301, a
license issued under this chapter is suspended on the next business day
following its renewal date by operation of law. An application for
renewal of any current contracting license addressed to the registrar, with a
valid bond or cash deposit on file with the registrar, accompanied by the
required fee and received by the registrar or deposited in the United States
mail postage prepaid on or before the renewal date authorizes the licensee to
operate as a contractor until actual issuance of the renewal
license. The registrar may refuse to renew a license if a licensee
or person has committed or been found guilty of any act listed in section 32-1154.

B. A license that has been suspended by operation of
law for failure to renew may be reactivated and renewed within one year of its
suspension by filing the required application and paying the application fee in
the amount provided for renewal in this chapter in addition to a $50 fee.� When
a license has been suspended for more than one year for failure to renew, a new
application for a license must be made and a new license issued in accordance
with this chapter.

C. A licensee may apply in writing to the registrar
for exemption from a qualifying party. The licensee must show to the
satisfaction of the registrar that during the past five years the licensee:

1. Held a valid and active license and could legally
contract under this chapter for the entire five-year period.

2. Did not transfer fifty percent or more of its
stock or beneficial interest.

3. Did not commit a violation of section 32-1154,
subsection A that has not been remedied.

D. The registrar shall
approve or deny the application within thirty days after its receipt.� If the
application is not approved, the licensee, within
thirty

sixty
days, may request a hearing to be held pursuant to
section 32-1156. If the application is approved, the exemption
takes effect immediately.

E. A licensee that is exempt from the requirement
for a qualifying party pursuant to subsection C of this section may be required
by the registrar
after a hearing
to obtain a qualifying
party within sixty days on a finding that:

1. A transfer of ownership of fifty percent or more
of the stock, if applicable, or beneficial interest, in the licensee has
occurred.

2. A violation of section 32-1154 has
occurred.
END_STATUTE

Sec. 5. Section 32-1133, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1133.

Civil recovery; statute of limitations

A. An action for a judgment that may subsequently
result in an order for collection from the residential contractors' recovery
fund may not be commenced later than two years after the date of the commission
of the act by the contractor that is the cause of the injury or from the date
of occupancy.

B. When a claimant commences an action for a
judgment that may result in collection from the fund, the claimant must notify
the registrar in writing to this effect within thirty calendar days after the
commencement of the action. The registrar at any time may intervene
in and defend the action.

C. When any claimant recovers a valid judgment
against any residential contractor for an act, representation, transaction or
conduct that is in violation of this chapter or the rules adopted pursuant to
this chapter, the claimant, on twenty days' written notice to the registrar,
may apply to the court for an order directing payment
out of
from
the fund, of the amount unpaid on the judgment, subject
to the limits stated in this article. If the claimant fails to
notify the registrar within thirty calendar days after commencement of the
action as required by this subsection, the court may direct payment
out of

from
the fund on receipt of a
consent to payment signed on behalf of the registrar.� If the claimant gives
notice to the registrar as required by this subsection, the court may direct
payment
out of
from
the fund either
on receipt of a consent to payment signed on behalf of the registrar or, in the
absence of any written consent, after the notice period required by this
subsection.� If the court receives written objections by the registrar, the
court may not direct payment from the fund without affording the registrar a
reasonable opportunity to present and support the registrar's objections.

D. The court may proceed on an application in a
summary manner and, on the hearing, the claimant is required to show that the
claimant has done all of the following:

1. Given notice as required by subsections B and C
of this section.

2. Obtained a judgment that has become final, as
provided in subsection C of this section, stating the amount and the amount
owing at the date of the application.

3. Proceeded against any existing bond covering the
residential contractor.

E. The court may make an order directed to the
registrar requiring payment from the fund of whatever sum it finds to be
payable on the claim, in accordance with this section, if the court is
satisfied on the hearing of the truth of all matters required to be shown by
the claimant by subsection D of this section.� The recovery limits established
under this article apply to all judgments awarded
beginning
September 1, 2002
.
If the claimant
has recovered a portion of the claimant's loss from sources other than the
fund, the court shall deduct the amount recovered from other sources from the
amount of actual damages suffered pursuant to section 32-1132.01,
subsection A and direct the difference, not to exceed $30,000, to be paid from
the fund.

F. On receipt of a certified copy of the order
specified in subsection E of this section, the registrar may authorize payment
from the residential contractors' recovery fund even if an appeal has been
instituted but not completed.

END_STATUTE

Sec. 6. Section 32-1133.01, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1133.01.

Administrative recovery; statute of limitations

A. Notwithstanding any other provision in this
chapter, if a contractor license has been revoked or suspended as a result of
an order to remedy
a violation of this chapter
or
if the registrar issues a final administrative decision finding that the
contractor has violated any provision of this chapter
, the registrar may
order payment from the residential contractors' recovery fund to remedy the
violation.

B. The registrar must serve the contractor with a
notice setting forth the amount claimed or to be awarded.

C. If the contractor
or claimant
contests
the amount or propriety of the payment, the contractor
or
claimant
must respond in writing within ten days after the date of
service by requesting a hearing to determine the amount or propriety of the
payment. The contractor's failure to respond in writing within ten
days after the date of service may be deemed a waiver by the contractor of the
right to contest the amount claimed or to be awarded.

D. Service of the notice required by subsection B of
this section may be made by personal service to the contractor or by mailing a
copy of the notice by certified mail with postage prepaid to the contractor's
latest address of record on file in the registrar's office.

E. If service is made by certified mail, it is
effective five days after the notice is mailed. Except as provided
in section 41-1092.08, subsection H, the contractor or claimant may seek
judicial review of the registrar's final award pursuant to title 12, chapter 7,
article 6.

F. A claimant to the residential contractors'
recovery fund pursuant to this section must show that the claimant has
proceeded against any existing bond covering the residential contractor.

G. A claim for payment from the residential
contractor's recovery fund must be submitted within two years after all
proceedings, reviews and appeals connected with the registrar's final order
terminate.
END_STATUTE

Sec. 7. Section 32-1155, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1155.

Filing of complaint; resolution of complaint; service of notice;
failure to answer; prohibited citations

A. On the filing of a written complaint with the
registrar charging a licensee with
the commission of
COMMITTING
an act that is cause for suspension or revocation
of a license, including an act that
is in violation of
VIOLATES
title 44, chapter 11, article 11, the registrar after
investigation, in its sole discretion, may issue a citation directing the
licensee, within ten days after service of the citation on the licensee, to
appear by filing with the registrar the licensee's written answer to the
citation and complaint showing cause, if any, why the licensee's license should
not be suspended or revoked. The complaint must be filed within the
statute of limitations prescribed by
section
32-1162.

B. Service of the citation on the licensee is fully
effected by personal service or by mailing a true copy
thereof,
together
of the citation
with a true copy of the
complaint, by certified mail in a sealed envelope with postage prepaid and
addressed to the licensee at the licensee's latest address of record in the
registrar's office.� Service of the citation and complaint is complete at the time
of personal service or five days after deposit in the mail.

C. Failure of the licensee to answer within ten days
after service may be deemed an admission by the licensee of the licensee's
commission of the act or acts charged in the complaint, and the registrar may
then suspend or revoke the licensee's license unless the registrar determines,
in its sole discretion, that the failure to answer within such period is
attributable to excusable neglect on the part of the licensee.

D. The registrar may not issue a citation for
failure to perform work in a professional and workmanlike manner or in
accordance with any applicable building codes and professional industry
standards if either:

1. The contractor is not provided an opportunity to
inspect the work within fifteen days after receiving a written notice
of inspection
from the registrar.

2. The contractor's work has been subject to
neglect, modification or abnormal use.

E. Notwithstanding subsection D of this section, the
registrar may investigate the complaint without waiting fifteen days.
END_STATUTE

Sec. 8. Section 32-1157, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1157.

Appeals; service; costs; transcript

A. Except as provided in section 41-1092.08,
subsection H, a final decision of the registrar may be appealed to the superior
court pursuant to title 12, chapter 7, article 6.

B. The party who is appealing may
request in writing and shall receive from the registrar a certified copy of all
documents and evidence in the administrative record.� The party shall pay the
registrar for the cost of producing the administrative record.� Within thirty
days after receipt of the request and payment, the registrar shall certify the
administrative record and file it with the clerk of the superior court in the
county in which the appeal is pending.

B. Service of final administrative
decisions issued by the registrar may be made by personal service or by
certified or first class mail to the party's last address of record on file in
the registrar's office. service made by certified or first class
mail is effective FIVE days after the decision is mailed.

C. By order of the court or by stipulation of the
parties to the action, the record may be shortened or supplemented.

D. If the appeal is from an action instituted by the
registrar and the court determines that the appellant is the successful party
in the appeal, the appealing party is entitled to recover from the registrar
any monies paid by the appealing party for transcriptions or for copies of
documents provided by the registrar.
END_STATUTE

Sec. 9. Section 32-1161, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-1161.

Rights of contractor after suspension or revocation of license

A. After suspending the license on any of the
grounds set forth in section 32-1154, the registrar shall renew
it
the license
on proof of compliance by
the contractor with provisions of the judgment relating to renewal of the
license, or in the absence of a judgment or provisions therein as to renewal,
on
a
proper showing that all loss caused by the act or
omission for which the license was suspended has been fully satisfied.

B. After suspending the license pursuant to section
32-1154, the licensee may perform, without compensation, warranty work or
other corrective work.

C. After revoking a
license on any of the grounds set forth in section 32-1154,
the
A new
license may not be
renewed or reissued

issued
for one year
after final determination of revocation and then only on
a
proper
showing that all loss caused by the act or omission for which the license was
revoked has been fully satisfied.� For the purposes of this subsection, a
proper showing may be made by demonstrating, to the satisfaction of the
registrar, that the licensee exhausted all reasonable means to remedy the
underlying loss caused by the act or omission.
END_STATUTE