Public Project Subcontractor Amendments

19
31A-22-1017
35A-4-305
58-55-313
58-55-502
HB0396
HB0040
31A-22-1017
35A-4-305
58-55-313
58-55-502
HB0396
HB0040
0
Public Project Subcontractor Amendments
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Jefferson S. Burton
Senate Sponsor: Brady Brammer
LONG TITLE
General Description:
This bill modifies disclosure requirements for subcontractors.
Highlighted Provisions:
This bill:
defines terms;
enacts a new workers' compensation insurance attestation requirement for an employer
seeking a zero estimated exposure policy, including a mandatory signed statement and
criminal fraud warning;
shifts several fixed interest rates and penalty amounts under the Employment Security Act
to amounts the division determines by rule;
clarifies enforcement authority and penalty structures related to unemployment insurance
reporting, collections, liens, and warrants;
creates new compliance and disclosure obligations for a subcontractor working on a
public construction project, including employee reporting and zero estimated exposure
policy disclosures;
requires a subcontractor on a public project to provide employee information to the
division;
requires a general contractor and a property owner to retain documentation for audit and
enforcement purposes;
authorizes the Division of Professional Licensing to make audit recommendations to the
State Tax Commission;
expands the definition of unprofessional conduct to include failure to comply with newly
enacted subcontractor requirements;
provides a coordination clause to substantively and technically coordinate changes
between this bill and H.B. 40, Utah Construction Trades Licensing Act Amendments;
and
makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
This bill provides a coordination clause.
Utah Code Sections Affected:
AMENDS:
35A-4-305
, as last amended by Laws of Utah 2024, Chapter 110
58-55-502
, as last amended by Laws of Utah 2022, Chapter 415
ENACTS:
31A-22-1017
, Utah Code Annotated 1953
58-55-313
, Utah Code Annotated 1953
Utah Code Sections Affected by Coordination Clause:
58-55-202
, as enacted by H.B. 40 (2026)

58-55-213
, Utah Code Annotated 1953

58-55-313
, Utah Code Annotated 1953
58-55-603
, as last amended by Laws of Utah 2025, Chapter 302

Be it enacted by the Legislature of the state of Utah:
Section 1. Section
31A-22-1017
is enacted to read:
31A-22-1017
. Attestation required.
(1)
As used in this section, "zero estimated exposure policy" means a policy of insurance
that an employer obtains to cover the employer's liability to pay compensation under
Title 34A, Chapter 2, Workers' Compensation Act, or Title 34A, Chapter 3, Utah
Occupational Disease Act, after reporting the employer's total estimated exposure is zero.
(2)
An insurer shall require each applicant for a zero estimated exposure policy to sign an
attestation in capital letters with substantially the following form and content: "I
ATTEST THAT ALL INFORMATION PROVIDED IN THIS APPLICATION IS
CURRENT, TRUE, ACCURATE, AND COMPLETE TO THE BEST OF MY
KNOWLEDGE AND BELIEF. I FURTHER ATTEST THAT I HAVE NO
EMPLOYEES AND AN ESTIMATED EXPOSURE OF ZERO. IF I EMPLOY ANY
EMPLOYEES DURING THE POLICY PERIOD, I SHALL PROVIDE WRITTEN
NOTICE TO MY WORKERS' COMPENSATION INSURER WITHIN 60 DAYS
AFTER THE EMPLOYMENT BEGINS, AND INCLUDE THE ESTIMATED
PAYROLL AND CLASSIFICATION CODES FOR THOSE EMPLOYEES. I
UNDERSTAND THAT AN OMISSION OR MISREPRESENTATION MADE WITH
INTENT TO DEFRAUD IN THIS APPLICATION CONSTITUTES A CRIMINAL
ACTION."
Section 2. Section
35A-4-305
is amended to read:
35A-4-305
. Collection of contributions -- Unpaid contributions to bear interest --
Offer to compromise.
(1)
(a)
Contributions unpaid on the date on which
they
the contributions
are due and
payable, as
prescribed by the division
the division determines
, shall bear interest at
the rate of 1% per month
a rate the division determines by rule the division makes in
accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
from
and after that date until
the division receives
payment plus accrued interest
is
received by the division
.
(b)
(i)
Contribution reports not made and filed by the date on which
they
the
contribution reports
are due as
prescribed by the division
the division determines

are subject to a penalty
the division determines by rule the division makes in
accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
to be
assessed and collected in the same manner as contributions due under this section

equal to 5% of the contribution due if the failure to file on time was not more than
15 days, with an additional 5% for each additional 15 days or fraction thereof
during which the failure continued, but not to exceed 25% in the aggregate and
not less than $25 with respect to each reporting period
.
(ii)
If a report is filed after the required time and
it is shown to the satisfaction of the
division or its
the division or the division's
authorized representative
determines
that the failure to file was due to a reasonable cause and not to willful neglect, no
addition shall be made to the contribution
penalty may be assessed
.
(c)
(i)
If contributions are unpaid after 10 days from the date
of the mailing or
personal delivery by the division or its authorized representative, of
the division
or the division's authorized representative mails or personally delivers
a written
demand for payment, there shall attach to the contribution, to be assessed and
collected in the same manner as contributions due under this section, a penalty
equal to 5% of the contribution due
the division determines by rule the division
makes in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
Act
.
(ii)
A penalty may not attach if within 10 days after the mailing or personal delivery,
arrangements for payment
have been
are
made with the division, or
its
the
division's
authorized representative, and payment is made in accordance with
those arrangements.
(d)
The division shall assess as a penalty a service charge, in addition to any other
penalties that may apply, in an amount not to exceed the service charge imposed by
Section
7-15-1
for dishonored instruments if:
(i)
any amount due the division for contributions, interest, other penalties or benefit
overpayments is paid by check, draft, order, or other instrument; and
(ii)
the instrument is dishonored or not paid by the institution against which
it
the
instrument
is drawn.
(e)
Except for benefit overpayments under Subsection
35A-4-405(5)
, benefit
overpayments, contributions, interest, penalties, and assessed costs, uncollected three
years after
they become
becoming
due, may be charged as uncollectible and
removed from the records of the division if:
(i)
no assets belonging to the liable person and subject to attachment
can be
are

found; and
(ii)
in the opinion of the division there is no likelihood of collection at a future date.
(f)
Interest
The division shall deposit interest
and penalties collected in accordance
with this section
shall be deposited
into the Workforce Initiatives Fund created in
Section
35A-4-506
.
(g)
Action required for the collection of sums
The division may bring an action to
collect a sum
due under this chapter
is
subject to
the applicable limitations of
actions under
Title 78B, Chapter 2, Statutes of Limitations.
(2)
(a)
If an employer fails to file a report when
prescribed by the division
the division
prescribes
for the purpose of determining the amount of the employer's contribution
due under this chapter, or if the report when filed is incorrect or insufficient or is not
satisfactory to the division, the division may determine the amount of wages paid for
employment during the period or periods with respect to which the reports were or
should have been made and the amount of contribution due from the employer on the
basis of any information
it
the division
may
be able to
obtain.
(b)
The division shall give written notice of the determination to the employer.
(c)
The determination is considered correct unless:
(i)
the employer, within 10 days after mailing or personal delivery of notice of the
determination, applies to the division for a review of the determination as
provided in Section
35A-4-508
; or
(ii)
unless
the division or
its
the division's
authorized representative
of its own
motion
reviews the determination.
(d)
The amount of contribution determined under Subsection
(2)(a)
is subject to
penalties and interest as provided in Subsection
(1)
.
(e)
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
division shall make rules making a penalty for an employer who fails to file a report
or files an incorrect report due to the employer's misclassification of an employee, as
defined in Section
34-47-102
.
(3)
(a)
If, after due notice, an employer defaults in the payment of contributions, interest,
or penalties on the contributions, or a claimant defaults in a repayment of benefit
overpayments and penalties on the overpayments, the amount due shall be collectible
by civil action in the name of the division, and the employer adjudged in default shall
pay the costs of the action.
(b)
Civil actions brought under this section to collect contributions, interest, or penalties
from an employer, or benefit overpayments and penalties from a claimant shall be:
(i)
heard by the court at the earliest possible date; and
(ii)
entitled to preference upon the calendar of the court over all other civil actions
except:
(A)
petitions for judicial review under this chapter; and
(B)
cases arising under the workers' compensation law of this state.
(c)
(i)
(A)
To collect contributions, interest, or penalties, or benefit overpayments
and penalties due from employers or claimants located outside Utah, the
division may employ private collectors providing debt collection services
outside Utah.
(B)
Accounts may be placed with private collectors only after the employer or
claimant has been given a final notice that the division intends to place the
account with a private collector for further collection action.
(C)
The notice shall advise the employer or claimant of the employer's or
claimant's rights under this chapter and the applicable rules of the department.
(ii)
(A)
A private collector may receive as compensation up to 25% of the lesser of
the amount collected or the amount due, plus the costs and fees of any civil
action or postjudgment remedy instituted by the private collector with the
approval of the division.
(B)
The employer or claimant shall be liable to pay the compensation of the
collector, costs, and fees in addition to the original amount due.
(iii)
A private collector is subject to the federal Fair Debt Collection Practices Act, 15
U.S.C. Sec. 1692 et seq.
(iv)
(A)
A civil action may not be maintained by a
A
private collector
may not
maintain a civil action
without specific prior written approval
of
from
the
division.
(B)
When division approval is given for civil action against an employer or
claimant, the division may cooperate with the private collector
to the extent
necessary
to effect the civil action.
(d)
(i)
Notwithstanding Section
35A-4-312
, the division may disclose the
contribution, interest, penalties or benefit overpayments and penalties, costs due,
the name of the employer or claimant, and the employer's or claimant's address
and telephone number when any collection matter is referred to a private collector
under Subsection
(3)(c)
.
(ii)
A private collector is subject to the confidentiality requirements and penalty
provisions provided in Sections
35A-4-312
and
76-8-1304
, except to the extent
disclosure is necessary in a civil action to enforce collection of the amounts due.
(e)
An action taken by the division under this section may not be construed to be an
election to forego other collection procedures by the division.
(4)
(a)
In the event of a distribution of an employer's assets under an order of a court
under the laws of Utah, including a receivership, assignment for benefits of creditors,
adjudicated insolvency, composition, or similar proceedings, contributions then or
thereafter due shall be paid in full prior to all other claims except taxes and claims for
wages of not more than $400 to each claimant, earned within five months of the
commencement of the proceeding.
(b)
If an employer commences a proceeding in the Federal Bankruptcy Court under a
chapter of 11 U.S.C. 101 et seq., as amended by the Bankruptcy Abuse Prevention
and Consumer Protection Act of 2005, contributions, interest, and penalties then or
thereafter due shall be entitled to the priority provided for taxes, interest, and
penalties in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.
(5)
(a)
In addition and as an alternative to any other remedy
provided by this chapter
this chapter provides,
and provided that no appeal or other proceeding for review
provided by this chapter
this chapter provides
is
then
pending and the time for
taking it has expired, the division may issue a warrant in duplicate, under
its
the
division's
official seal, directed to the sheriff of any county of the state, commanding
the sheriff to levy upon and sell the real and personal property of a delinquent
employer or claimant found within the sheriff's county for the payment of the
contributions due, with the added penalties, interest, or benefit overpayment and
penalties, and costs, and to return the warrant to the division and pay into the fund the
money collected by virtue of the warrant by a time to be specified in the warrant, not
more than 60 days from the date of the warrant.
(b)
(i)
Immediately upon receipt of the warrant in duplicate, the sheriff shall file the
duplicate with the clerk of the district court in the sheriff's county.
(ii)
The clerk shall enter in the judgment docket, in the column for judgment debtors,
the name of the delinquent employer or claimant mentioned in the warrant, and in
appropriate columns the amount of the contribution, penalties, interest, or benefit
overpayment and penalties, and costs, for which the warrant is issued and the date
when the duplicate is filed.
(c)
The amount of the docketed warrant shall:
(i)
have the force and effect of an execution against all personal property of the
delinquent employer; and
(ii)
become a lien upon the real property of the delinquent employer or claimant in
the same manner and to the same extent as a judgment duly rendered by a district
court and docketed in the office of the clerk.
(d)
After docketing, the sheriff shall:
(i)
proceed in the same manner as is prescribed by law with respect to execution
issued against property upon judgments of a court of record; and
(ii)
be entitled to the same fees for the sheriff's services in executing the warrant, to
be collected in the same manner.
(6)
(a)
Contributions
imposed by this chapter
this chapter imposes
are a lien upon the
property of an employer liable for the contribution required to be collected under this
section who shall sell out the employer's business or stock of goods or shall quit
business, if the employer fails to make a final report and payment on the date
subsequent to
after
the date of selling or quitting business on which
they
the
contributions
are due and payable as prescribed by rule.
(b)
(i)
An employer's successor, successors, or assigns, if any, are required to
withhold sufficient of the purchase money to cover the amount of the
contributions and interest or penalties
contributions, interest, and penalties
due
and payable until the former owner produces a receipt from the division showing
that
they
the contributions, interest, and penalties
have been paid or a certificate
stating that no amount is due.
(ii)
If the purchaser of a business or stock of goods fails to withhold sufficient
purchase money, the purchaser is personally liable for the payment of the amount
of the contributions required to be paid by the former owner, interest and penalties
accrued and unpaid by the former owner, owners, or assignors.
(7)
(a)
If an employer is delinquent in the payment of a contribution, the division may
give notice of the amount of the delinquency by registered mail to all persons having
in their possession or under their control, any credits or other personal property
belonging to the employer, or owing any debts to the employer at the time of the
receipt by them of the notice.
(b)
A person notified under Subsection
(7)(a)
shall neither transfer nor make any other
disposition of the credits, other personal property, or debts until:
(i)
the division has consented to a transfer or disposition; or
(ii)
20 days after the receipt of the notice.
(c)
All persons notified under Subsection
(7)(a)
shall, within five days after receipt of
the notice, advise the division of credits, other personal property, or other debts in
their possession, under their control or owing by them, as the case may be.
(8)
(a)
(i)
Each employer shall furnish the division necessary information for the
proper administration of this chapter and shall include wage information for each
employee, for each calendar quarter.
(ii)
The information shall be furnished at a time, in the form
and manner
, and to those
individuals as the department may
by rule require
require by rule the department
makes in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
Act
.
(iii)
The division may require an employer to post a bond for failure to comply with
the rules required by Subsection
(8)(a)(i)
.
(b)
(i)
Each employer shall furnish each individual worker who is separated that
information as the department may by rule require, and shall furnish within 48
hours of the receipt of a request from the division a report of the earnings of any
individual during the individual's base-period.
(ii)
The report shall be on a form prescribed by the division and contain all
information prescribed by the division.
(c)
(i)
For each failure by an employer to conform to this Subsection
(8)
the division
shall, unless good cause is shown, assess a
$50 penalty if the filing was not more
than 15 days late
penalty that the division determines by rule the division makes
in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act
.
(ii)
If the filing is more than 15 days late, the division shall assess an additional
penalty of $50 for each 15 days, or a fraction of the 15 days that the filing is late,
not to exceed $250 per filing.
(iii)
(ii)
The penalty is to be collected in the same manner as contributions due under
this chapter.
(d)
(i)
The division shall prescribe rules providing standards for determining which
contribution reports shall be filed on magnetic or electronic media or in other
machine-readable form.
(ii)
In prescribing these rules, the division:
(A)
may not require an employer to file contribution reports on magnetic or
electronic media unless the employer is required to file wage data on at least
250 employees during any calendar quarter or is an authorized employer
representative who files quarterly tax reports on behalf of 100 or more
employers during any calendar quarter;
(B)
shall take into account, among other relevant factors, the ability of the
employer to comply at reasonable cost with the requirements of the rules; and
(C)
may require an employer to post a bond for failure to comply with the rules
required by this Subsection (8)(d).
(9)
(a)
(i)
An employer liable for payments in lieu of contributions shall file
Reimbursable Employment and Wage Reports.
(ii)
The reports are due on the last day of the month that follows the end of each
calendar quarter unless the division, after giving notice, changes the due date.
(iii)
A report postmarked on or before the due date is considered timely.
(b)
(i)
Unless the employer can show good cause, the division shall assess a
$50
penalty
penalty that the division determines by rule the division makes in
accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
against an employer who does not file Reimbursable Employment and Wage
Reports within the time limits set out in Subsection
(9)(a)
if the filing was not
more than 15 days late.
(ii)
If the filing is more than 15 days late, the division shall assess an additional
penalty of $50 for each 15 days, or a fraction of the 15 days that the filing is late,
not to exceed $250 per filing.
(iii)
(ii)
The division shall assess and collect the penalties referred to in this
Subsection
(9)(b)
in the same manner as prescribed in Sections
35A-4-309
and
35A-4-311
.
(10)
If a person liable to pay a contribution or benefit overpayment
imposed by this chapter
that this chapter imposes
neglects or refuses to pay
it
the contribution or benefit
overpayment
after demand, the amount, including any interest, additional amount,
addition to contributions, or assessable penalty, together with any additional accruable
costs, shall be a lien in favor of the division upon all property and rights to property,
whether real or personal belonging to the person.
(11)
(a)
The lien imposed by Subsection
(10)
arises at the time the assessment, as defined
in the department rules, is made and continues until the liability for the amount
assessed, or a judgment against the taxpayer arising out of the liability, is satisfied.
(b)
(i)
The lien imposed by Subsection
(10)
is not valid as against a purchaser, holder
of a security interest, mechanics' lien holder, or judgment lien creditor until the
division files a warrant with the clerk of the district court.
(ii)
For the purposes of this Subsection
(11)(b)
:
(A)
"Judgment lien creditor" means a person who obtains a valid judgment of a
court of record for recovery of specific property or a sum certain of money, and
who in the case of a recovery of money, has a perfected lien under the
judgment on the property involved. A judgment lien does not include inchoate
liens such as attachment or garnishment
liens until they ripen
until the
inchoate lien ripens
into a judgment. A judgment lien does not include the
determination or assessment of a quasi-judicial authority, such as a state or
federal taxing authority.
(B)
"Mechanics' lien holder" means any person who has a lien on real property, or
on the proceeds of a contract relating to real property, for services, labor, or
materials furnished in connection with the construction or improvement of the
property. A person has a lien on the earliest date the lien becomes valid
against subsequent purchasers without actual notice, but not before the person
begins to furnish the services, labor, or materials.
(C)
"Person" means:
(I)
an individual;
(II)
a trust;
(III)
an estate;
(IV)
a partnership;
(V)
an association;
(VI)
a company;
(VII)
a limited liability company;
(VIII)
a limited liability partnership; or
(IX)
a corporation.
(D)
"Purchaser" means a person who, for adequate and full consideration in
money or money's worth, acquires an interest, other than a lien or security
interest, in property which is valid under state law against subsequent
purchasers without actual notice.
(E)
"Security interest" means any interest in property acquired by contract for the
purpose of securing payment or performance of an obligation or indemnifying
against loss or liability. A security interest exists at any time:
(I)
the property is in existence and the interest has become protected under the
law against a subsequent judgment lien arising out of an unsecured
obligation; and
(II)
to the extent that, at that time, the holder has parted with money or money's
worth.
(12)
(a)
Except in cases involving a violation of unemployment compensation provisions
under Sections
76-8-1301
,
76-8-1302
,
76-8-1303
,
76-8-1304
, Subsection
35A-4-304(5)
, or Subsection
35A-4-405(5)
, and at the discretion of the division, the
division may accept an offer in compromise from an employer or claimant to reduce
past due debt arising from contributions or benefit overpayments imposed under this
chapter.
(b)
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
division shall make rules for allowing an offer in compromise provided under
Subsection
(12)(a)
.
The following section is affected by a coordination clause at the end of this bill.
Section 3. Section
58-55-313
is enacted to read:
58-55-313
. Subcontractors.
(1)
As used in this section:
(a)
"First-tier subcontractor" means a subcontractor who contracts directly with the
general contractor.
(b)
"Public project" means the contract is with or authorized by a public entity as defined
in Section
63G-6a-103
.
(c)
"Second-tier subcontractor" means a subcontractor that contracts with a
subcontractor.
(d)
(i)
"Subcontractor" means a person under contract with a general contractor or
another subcontractor to provide services or labor for the construction,
installation, or repair of an improvement to real property.
(ii)
"Subcontractor" includes a trade contractor or specialty contractor.
(iii)
"Subcontractor" includes a first-tier subcontractor and a second-tier
subcontractor.
(iv)
"Subcontractor" does not include a supplier that provides only materials,
equipment, or supplies to a general contractor or subcontractor.
(e)
"Zero estimated exposure policy" means the same as that term is defined in Section
31A-22-1017
.
(2)
Before engaging in a construction trade on a public project, a subcontractor shall:
(a)
provide a list of current employees to the general contractor and the property owner
for which the subcontractor engages in a construction trade;
(b)
provide the general contractor and the property owner the second-tier subcontractor's
name and the second-tier subcontractor's license number if the subcontractor intends
to accept a contract with a second-tier subcontractor related to construction trade on a
public project;
(c)
if the subcontractor holds a zero estimated exposure policy, provide to a person that
contracts with the subcontractor for construction trade on a public project:
(i)
written notice that the subcontractor has a zero estimated exposure policy; and
(ii)
a copy of the zero estimated exposure policy;
(d)
ensure that each of the subcontractor's employees on the construction site possess
photo identification and shall ensure that the identification will be presented to the
division upon request; and
(e)
provide to the general contractor and the property owner the estimated number of
labor hours for their portion of the project.
(3)
At the division's request, a subcontractor shall provide the following for each current
employee of the subcontractor:
(a)
the name of the employee;
(b)
the last four digits of the social security number of the employee; and
(c)
if the employee possesses a professional license, the professional license number of
the employee.
(4)
(a)
The general contractor and the property owner shall retain the information the
subcontractor provides for three years from the day after the day on which the
general contractor and the property owner receive
the information from the
subcontractor.
(b)
The general contractor and the property owner shall provide the information the
general contractor and the property owner receive from a subcontractor to the
division at the division's request.
(5)
The division may:
(a)
make audit recommendations to the State Tax Commission; and
(b)
provide information obtained in accordance with this section to the State Tax
Commission.
Section 4. Section
58-55-502
is amended to read:
58-55-502
. Unprofessional conduct.
Unprofessional conduct includes:
(1)
failing to establish, maintain, or demonstrate financial responsibility while licensed as a
contractor under this chapter;
(2)
disregarding or violating through gross negligence or a pattern of negligence:
(a)
the building or construction laws of this state or any political subdivision;
(b)
the safety and labor laws applicable to a project;
(c)
any provision of the health laws applicable to a project;
(d)
the workers' compensation insurance laws of this state applicable to a project;
(e)
the laws governing withholdings for employee state and federal income taxes,
unemployment taxes, Social Security payroll taxes, or other required withholdings; or
(f)
any reporting, notification, and filing laws of this state or the federal government;
(3)
any willful, fraudulent, or deceitful act by a licensee, caused by a licensee, or at a
licensee's direction which causes material injury to another;
(4)
contract violations that pose a threat or potential threat to the public health, safety, and
welfare including:
(a)
willful, deliberate, or grossly negligent departure from or disregard for plans or
specifications, or abandonment or failure to complete a project without the consent of
the owner or the owner's duly authorized representative or the consent of any other
person entitled to have the particular project completed in accordance with the plans,
specifications, and contract terms;
(b)
failure to deposit funds to the benefit of an employee as required under any written
contractual obligation the licensee has to the employee;
(c)
failure to maintain in full force and effect any health insurance benefit to an
employee that was extended as a part of any written contractual obligation or
representation by the licensee, unless the employee is given written notice of the
licensee's intent to cancel or reduce the insurance benefit at least 45 days before the
effective date of the cancellation or reduction;
(d)
failure to reimburse the Residence Lien Recovery Fund as required by Section
38-11-207
;
(e)
failure to provide, when applicable, the information required by Section
38-11-108
;
and
(f)
willfully or deliberately misrepresenting or omitting a material fact in connection
with an application to claim recovery from the Residence Lien Recovery Fund under
Section
38-11-204
;
(5)
failing as an alarm company to notify the division of the cessation of performance of
its
the alarm company's
qualifying agent, or failing to replace
its
the alarm company's

qualifying agent as required under Section
58-55-304
;
(6)
failing as an alarm company agent to carry or display a copy of the licensee's license as
required under Section
58-55-311
;
(7)
failing to comply with operating standards established by rule in accordance with
Section
58-55-308
;
(8)
an unincorporated entity licensed under this chapter having an individual who owns an
interest in the unincorporated entity engage in a construction trade in Utah while not
lawfully present in the United States;
(9)
an unincorporated entity failing to provide the following for an individual who engages,
or will engage, in a construction trade in Utah for the unincorporated entity:
(a)
workers' compensation coverage to the extent required by
Title 34A, Chapter 2,
Workers' Compensation Act
, and
Title 34A, Chapter 3, Utah Occupational Disease
Act
; and
(b)
unemployment compensation in accordance with
Title 35A, Chapter 4, Employment
Security Act
, for an individual who owns, directly or indirectly, less than an 8%
interest in the unincorporated entity, as defined by rule made by the division in
accordance with
Title 63G, Chapter 3, Utah Administrative Rulemaking Act
;
(10)
the failure of an alarm company or alarm company agent to inform a potential
customer, before the customer's purchase of an alarm system or alarm service from the
alarm company, of the policy of the county, city, or town within which the customer
resides relating to priority levels for responding to an alarm signal transmitted by the
alarm system that the alarm company provides the customer;
or
(11)
failing to continuously maintain insurance and registration as required under
Subsection
58-55-302(2)
.
; or
(12)
failing to comply with Section
58-55-313
.
Section 5.
Effective Date.
This bill takes effect on
May 6, 2026
.
Section 6.
Coordinating H.B. 396 with H.B. 40.
If H.B. 396, Public Project Subcontractor Amendments, and H.B. 40, Utah
Construction Trades Licensing Act Amendments, both pass and become law, the Legislature
intends that, on January 1, 2027:
(1) the following language be inserted as Subsection 58-55-603(9) in H.B. 40:
"(9) fails to comply with Section 58-55-213.";
(2) the following definitions be inserted alphabetically into Section 58-55-202 in H.B. 40
and that the existing subsections in Section 58-55-202 in H.B. 40 be renumbered accordingly:
(a) ""First-tier subcontractor" means a subcontractor that contracts directly with the general
contractor.";
(b) ""Public project" means the contract is with or authorized by a public entity as defined
in Section 63G-6a-103.";
(c) ""Second-tier subcontractor" means a subcontractor that contracts with a subcontractor.
(d) "(a) "Subcontractor" means a person under contract with a general contractor or another
subcontractor to provide services or labor for the construction, installation, or repair of an
improvement to real property.
(b) "Subcontractor" includes a trade contractor or specialty contractor.
(c) "Subcontractor" includes a first-tier subcontractor and a second-tier subcontractor.
(d) "Subcontractor" does not include a supplier that provides only materials, equipment, or
supplies to a general contractor or subcontractor."; and
(e) ""Zero estimated exposure policy" means the same as that term is defined in Section
31A-22-1017.";
(3) Section 58-55-313 enacted in H.B. 396 not take effect; and
(4) Section 58-55-213 be enacted to read:
"58-55-213. Public Project Subcontractors.
(1) Before engaging in a construction trade on a public project, a subcontractor shall:
(a) provide a list of current employees to the general contractor and the property owner for
which the subcontractor engages in a construction trade;
(b) provide the general contractor and the property owner the second-tier subcontractor's
name and the second-tier subcontractor's license number if the subcontractor intends to accept
a contract with a second-tier subcontractor related to construction trade on a public project;
(c) if the subcontractor holds a zero estimated exposure policy, provide to a person that
contracts with the subcontractor for construction trade on a public project:
(i) written notice that the subcontractor has a zero estimated exposure policy; and
(ii) a copy of the zero estimated exposure policy;
(d) ensure that each of the subcontractor's employees on the construction site possess photo
identification and shall ensure that the identification will be presented to the division upon
request; and
(e) provide to the general contractor and the property owner the estimated number of labor
hours for their portion of the project.
(2) At the division's request, a subcontractor shall provide the following for each current
employee of the subcontractor:
(a) the name of the employee; and
(b) if the employee possesses a professional license, the professional license number of the
employee.
(3)(a) The general contractor and the property owner shall retain the information the
subcontractor provides for three years from the day after the day on which the general
contractor and the property owner receive the information from the subcontractor.
(b) The general contractor and the property owner shall provide the information the general
contractor and the property owner receive from a subcontractor to the division at the division's
request.
(4) The division may:
(a) make audit recommendations to the State Tax Commission; and
(b) provide information obtained in accordance with this section to the State Tax
Commission.".
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