| 1 | 1 | | PREFILED JAN 13 2025 REFERENCE TITLE: handymen; contractor's license; exemption State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025 HB 2120 Introduced by Representative Carter N AN ACT Amending section 32-1121, Arizona Revised Statues, as amended by laws 2019, chapter 140, section 1; Amending section 32-1121, Arizona Revised Statutes, as amended by laws 2019, Chapter 145, Section 5; Amending Sections 32-1123 and 32-1158, Arizona Revised Statutes; relating to contractors. (TEXT OF BILL BEGINS ON NEXT PAGE) |
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| 9 | 9 | | PREFILED JAN 13 2025 |
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| 11 | 11 | | REFERENCE TITLE: handymen; contractor's license; exemption |
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| 12 | 12 | | State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025 |
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| 13 | 13 | | HB 2120 |
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| 14 | 14 | | Introduced by Representative Carter N |
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| 16 | 16 | | REFERENCE TITLE: handymen; contractor's license; exemption |
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| 26 | 26 | | State of Arizona |
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| 28 | 28 | | House of Representatives |
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| 30 | 30 | | Fifty-seventh Legislature |
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| 32 | 32 | | First Regular Session |
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| 34 | 34 | | 2025 |
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| 42 | 42 | | HB 2120 |
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| 46 | 46 | | Introduced by |
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| 48 | 48 | | Representative Carter N |
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| 66 | 66 | | AN ACT |
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| 70 | 70 | | Amending section 32-1121, Arizona Revised Statues, as amended by laws 2019, chapter 140, section 1; Amending section 32-1121, Arizona Revised Statutes, as amended by laws 2019, Chapter 145, Section 5; Amending Sections 32-1123 and 32-1158, Arizona Revised Statutes; relating to contractors. |
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| 76 | 76 | | (TEXT OF BILL BEGINS ON NEXT PAGE) |
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| 80 | 80 | | Be it enacted by the Legislature of the State of Arizona: Section 1. Section 32-1121, Arizona Revised Statutes, as amended by Laws 2019, chapter 140, section 1, is amended to read: START_STATUTE32-1121. Persons not required to be licensed; penalties; applicability A. This chapter does not apply to: 1. An authorized representative of the United States government, this state or any county, incorporated city or town, reclamation district, irrigation district or other municipality or political subdivision of this state. 2. Trustees of an express trust that is not formed for the purpose of conducting business as a contractor or officers of a court, if they are acting within the terms of their trust or office. 3. Public utilities operating under regulation of the corporation commission or construction, repair or operation incidental to discovering or producing petroleum or gas, or drilling, testing, abandoning or otherwise operating a petroleum or gas well, if performed by an owner or lessee. 4. Any materialman, manufacturer or retailer that furnishes finished products, materials or articles of merchandise and that does not install or attach such items or installs or attaches such items if the total value of the sales contract or transaction involving such items and the cost of the installation or attachment of such items to a structure does not exceed $1,000 is not more than $3,500, including labor, materials and all other items, but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure. The materialman, manufacturer or retailer shall inform the purchaser that the installation may also be performed by a licensed contractor whose name and address the purchaser may request. 5. Owners of property who improve such property or who build or improve structures or appurtenances on such property and who do the work themselves, with their own employees or with duly licensed contractors, if the structure, group of structures or appurtenances, including the improvements thereto, are intended for occupancy solely by the owner and are not intended for occupancy by members of the public as the owner's employees or business visitors and the structures or appurtenances are not intended for sale or for rent. In all actions brought under this chapter, except an action against an owner-occupant as defined in section 33-1002, proof of the sale or rent or the offering for sale or rent of any such structure by the owner-builder within one year after completion or issuance of a certificate of occupancy is prima facie evidence that such a project was undertaken for the purpose of sale or rent. For the purposes of this paragraph, "sale" or "rent" includes any arrangement by which the owner receives compensation in money, provisions, chattels or labor from the occupancy or the transfer of the property or the structures on the property. 6. Owners of property who are acting as developers and who build structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor licensed pursuant to this chapter and owners of property who are acting as developers, who improve structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor or specialty contractors licensed pursuant to this chapter. To qualify for the exemption under this paragraph, the licensed contractors' names and license numbers shall be included in all sales documents. 7. Architects or engineers who are engaging in their professional practice as defined in chapter 1 of this title and who hire or offer to hire the services of a contractor for preconstruction activities relating to investigation and discovery, including: (a) Subsurface utility location and designation services. (b) Potholing. (c) Drilling for any of the following: (i) Soil samples. (ii) Rock samples. (iii) Pavement samples. (d) Locating existing features of a building or structure, including existing electrical, mechanical, plumbing and structural members. 8. A person licensed, certified or registered pursuant to title 3, chapter 20 or a person working under the direct supervision of a person certified or qualified pursuant to title 3, chapter 20 to the extent the person is engaged in pest management. 9. The sale or installation of finished products, materials or articles of merchandise that are not fabricated into and do not become a permanent fixed part of the structure. This exemption does not apply if a local building permit is required, if the total price of the finished product, material or article of merchandise, including labor but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, is more than $1,000 $3,500 or if the removal of the finished product, material or article of merchandise causes material damage to the structure or renders the structure unfit for its intended use. 10. Employees of the owners of condominiums, townhouses, cooperative units or apartment complexes of four units or less or the owners' management agent or employees of the management agent repairing or maintaining structures owned by them. 11. Any person who engages in the activities regulated by this chapter, as an employee of an exempt property owner or as an employee with wages as the person's sole compensation. 12. A surety company or companies that are authorized to transact business in this state and that undertake to complete a contract on which they issued a performance or completion bond if all construction work is performed by duly licensed contractors. 13. Insurance companies that are authorized to transact business in this state and that undertake to perform repairs resulting from casualty losses pursuant to the provisions of a policy if all construction work is performed by duly licensed contractors. 14. Any person other than a licensed contractor engaging in any work or operation on one undertaking or project by one or more contracts, for which the aggregate contract price, including labor, materials and all other items, but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, is less not more than $1,000 $3,500. The work or operations that are exempt under this paragraph shall be of a casual or minor nature. This exemption does not apply: (a) In any case in which the performance of the work requires a local building permit. (b) In any case in which the work or construction is only a part of a larger or major operation, whether undertaken by the same or a different contractor, or in which a division of the operation is made in contracts of amounts less than $1,000 of not more than $3,500, excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, for the purpose of evasion of this chapter or otherwise. (c) To a person who uses any form of advertising to the public in which the person's unlicensed status is not disclosed by including the words "not a licensed contractor" in the advertisement. 15. A person who is licensed, certified or registered pursuant to title 41, chapter 37, article 4 and who is not otherwise required to be licensed under this chapter or an employee of such person. 16. A person who functions as a gardener by performing lawn, garden, shrub and tree maintenance. 17. Alarm agents as defined in section 32-101. 18. Cable television, satellite television and telecommunications providers, including data and related services of cable television, satellite television and telecommunications providers including contractors and subcontractors of cable television, satellite television and telecommunications providers if the work of the contractors and subcontractors is limited to installing low-voltage cable, telephone services, internet services and data service. Installation Installing does not include digging, trenching, grading, horizontal boring, compacting or filling earthen or other material before the service drop of the commercial or residential structure. B. A person who is licensed to perform work in a particular trade pursuant to this chapter is not required to obtain and maintain a separate license for mechanical or structural service work the person performs within the scope of that trade. C. Any person who does not have an exemption from licensure pursuant to subsection A, paragraph 14, subdivision (c) of this section is subject to prosecution for a violation of section 44-1522. The attorney general may investigate the act or practice and take appropriate action pursuant to title 44, chapter 10, article 7. D. The exemptions from licensure pursuant to subsection A, paragraphs 4, 9 and 14 of this section do not apply to either of the following: 1. All fire safety and mechanical, electrical and plumbing work that is done in connection with fire safety installation and fire safety maintenance and repair. For the purposes of this paragraph, "fire safety installation" means hardwired or interconnected smoke alarms and fire sprinklers and does not include an individual device that is attached by a nail, screw or other fastening device to the frame or foundation of any residential unit. For the purposes of this paragraph, fire safety maintenance and repair does not include routine work that is conducted by an employee of an apartment or condominium complex and that is incidental to the fire safety equipment. 2. All work done, including installing, maintaining and repairing devices, appliances or equipment, that involves connecting to any supply of natural gas, propane or other petroleum or gaseous fuel. This paragraph does not impact the effect of section 36-1624.01.END_STATUTE Sec. 2. Section 32-1121, Arizona Revised Statutes, as amended by Laws 2019, chapter 145, section 5, is amended to read: START_STATUTE32-1121. Persons not required to be licensed; penalties; applicability A. This chapter does not apply to: 1. An authorized representative of the United States government, this state or any county, incorporated city or town, reclamation district, irrigation district or other municipality or political subdivision of this state. 2. Officers of a court or trustees of an express trust that is not formed for the purpose of conducting business as a contractor, if they are acting within the terms of their office or trust. 3. Public utilities operating under regulation of the corporation commission or construction, repair or operation incidental to discovering or producing petroleum or gas, or the drilling, testing, abandoning or other operation of a petroleum or gas well, if performed by an owner or lessee. 4. Except as provided in subsection D of this section, any materialman, manufacturer or retailer who informs the purchaser that the installation may also be performed by a licensed contractor whose name and address the purchaser may request, and who furnishes finished products, materials or articles of merchandise and who either: (a) Does not install or attach such items. (b) Installs or attaches such items if the total value of the sales contract or transaction involving such items and the cost of the installation or attachment of such items to a structure does not exceed $1,000 is not more than $3,500, including labor, materials and all other items, but excluding any electrical fixture or appliance that meets all of the following: (i) Was designed by the manufacturer. (ii) Is unaltered, unchanged or unmodified by any person. (iii) Can be plugged into a common electrical outlet. 5. Owners of property who improve such property or who build or improve structures or appurtenances on such property and who do the work themselves, with their own employees or with duly licensed contractors, if the structure, group of structures or appurtenances, including the improvements thereto, are intended for occupancy solely by the owner and are not intended for occupancy by members of the public as the owner's employees or business visitors and the structures or appurtenances are not intended for sale or for rent. In all actions brought under this chapter, except an action against an owner-occupant as defined in section 33-1002, proof of the sale or rent or the offering for sale or rent of any such structure by the owner-builder within one year after completion or issuance of a certificate of occupancy is prima facie evidence that such project was undertaken for the purpose of sale or rent. For the purposes of this paragraph, "sale" or "rent" includes any arrangement by which the owner receives compensation in money, provisions, chattels or labor from the occupancy or the transfer of the property or the structures on the property. 6. Owners of property who are acting as developers and who build structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor licensed pursuant to this chapter and owners of property who are acting as developers, who improve structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor or specialty contractors licensed pursuant to this chapter. To qualify for the exemption under this paragraph, the licensed contractors' names and license numbers must be included in all sales documents. 7. Architects or engineers who are engaging in their professional practice as defined in chapter 1 of this title and who hire or offer to hire the services of a contractor for preconstruction activities relating to investigation and discovery, including: (a) Subsurface utility location and designation services. (b) Potholing. (c) Drilling for any of the following: (i) Soil samples. (ii) Rock samples. (iii) Pavement samples. (d) Locating existing features of a building or structure, including existing electrical, mechanical, plumbing and structural members. 8. A person licensed, certified or registered pursuant to title 3, chapter 20 or a person working under the direct supervision of a person certified or qualified pursuant to title 3, chapter 20 to the extent the person is engaged in pest management. 9. Except as provided in subsection D of this section, the sale or installation of finished products, materials or articles of merchandise that are not fabricated into and do not become a permanent fixed part of the structure. This exemption does not apply if a local building permit is required, if the removal of the finished product, material or article of merchandise causes damage to the structure or renders the structure unfit for its intended use or if the total price of the finished product, material or article of merchandise is more than $1,000 $3,500, including labor but excluding any electrical fixture or appliance that meets all of the following: (a) Was designed by the manufacturer. (b) Is unaltered, unchanged or unmodified by any person. (c) Can be plugged into a common electrical outlet. 10. Employees of the owners of condominiums, townhouses, cooperative units or apartment complexes of four units or less or the owners' management agent or employees of the management agent repairing or maintaining structures owned by them. 11. Any person who engages in the activities regulated by this chapter, as an employee of an exempt property owner or as an employee with wages as the person's sole compensation. 12. A surety company or companies that are authorized to transact business in this state and that undertake to complete a contract on which they issued a performance or completion bond, if construction work is performed by duly licensed contractors. 13. Insurance companies that are authorized to transact business in this state and that undertake to perform repairs resulting from casualty losses pursuant to the provisions of a policy, if construction work is performed by duly licensed contractors. 14. Except as provided in subsection D of this section, any person other than a licensed contractor engaging in any work or operation on one undertaking or project by one or more contracts, for which the aggregate contract price is less not more than $1,000 $3,500, including labor, materials and all other items, but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person and that can be plugged into a common electrical outlet. The work or operations that are exempt under this paragraph must be of a casual or minor nature. This exemption does not apply: (a) In any case in which the performance of the work requires a local building permit. (b) In any case in which the work or construction is only a part of a larger or major operation, whether undertaken by the same or a different contractor, or in which a division of the operation is made in contracts of amounts less than $1,000 of not more than $3,500, excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person and that can be plugged into a common electrical outlet. (c) To a person who utilizes any form of advertising to the public in which the person's unlicensed status is not disclosed by including the words "not a licensed contractor" in the advertisement. 15. A person who is licensed, certified or registered pursuant to title 41, chapter 37, article 4 and who is not otherwise required to be licensed under this chapter or an employee of such person. 16. A person who functions as a gardener by performing lawn, garden, shrub and tree maintenance. 17. Alarm agents as defined in section 32-101. B. A person who is licensed to perform work in a particular trade pursuant to this chapter is not required to obtain and maintain a separate license for mechanical or structural service work performed within the scope of such trade by such person. C. Any person who does not have an exemption from licensure pursuant to subsection A, paragraph 14, subdivision (c) of this section is subject to prosecution for a violation of section 44-1522. The attorney general may investigate the act or practice and take appropriate action pursuant to title 44, chapter 10, article 7. D. The exemptions from licensure pursuant to subsection A, paragraphs 4, 9 and 14 of this section do not apply to either of the following: 1. All fire safety and mechanical, electrical and plumbing work that is done in connection with fire safety installation and fire safety maintenance and repair. For the purposes of this paragraph, "fire safety installation" means hardwired or interconnected smoke alarms and fire sprinklers and does not include an individual device that is attached by a nail, screw or other fastening device to the frame or foundation of any residential unit. For the purposes of this paragraph, fire safety maintenance and repair does not include routine work that is conducted by an employee of an apartment or condominium complex and that is incidental to the fire safety equipment. 2. All work that is done, including the installation, maintenance and repair of devices, appliances or equipment, that involves the connecting to any supply of natural gas, propane or other petroleum or gaseous fuel. Nothing in this paragraph impacts the effect of section 36-1624.01. E. A joint venture or other combination of persons, firms, partnerships, corporations, associations or other organizations is not required to obtain a separate contractor's license in its own name if all of the following apply: 1. At least one member of the joint venture or combination holds a contractor's license in good standing with the registrar. 2. Each member of the joint venture or combination that acts as a contractor holds a license in good standing with the registrar. 3. Each licensed member of the joint venture or combination only performs work within the scope of that member's contractor's license or licenses. END_STATUTE Sec. 3. Section 32-1123, Arizona Revised Statutes, is amended to read: START_STATUTE32-1123. Unlicensed contractors; contract bidding; license denial; exemptions; warning A. Except as provided in subsection D of this section, if an entity that is not licensed or not properly licensed pursuant to this chapter bids on a contract for a project with an aggregate worth of more than $1,000 $3,500, the registrar may not issue the entity a license for one year after the bid date. For the purposes of this subsection, aggregate worth does not include any electrical fixture or appliance that meets all of the following: 1. Was designed by the manufacturer. 2. Is unaltered, unchanged or unmodified by any person. 3. Can be plugged into a common electrical outlet. 4. Does not involve the connection to a supply of natural gas, propane or other petroleum or gaseous fuel. B. This section does not apply to an entity that bids on a contract for either of the following: 1. A department of transportation project. 2. A project that is subject to the federal acquisition regulation, title 48 Code of Federal Regulations, including the department of defense federal acquisition regulation. C. This section does not affect the licensing exemptions prescribed in section 32-1121. D. The registrar shall issue an entity a written warning relating to unlicensed activity if the registrar has not previously issued the entity a warning and if the entity bids on a contract for a project pursuant to subsection A of this section and the project has an aggregate worth of more than $1,000 $3,500 but less than $20,000, excluding any electrical fixture or appliance that meets all of the following: 1. Was designed by the manufacturer. 2. Is unaltered, unchanged or unmodified by any person. 3. Can be plugged into a common electrical outlet. 4. Does not involve the connection to a supply of natural gas, propane or other petroleum or gaseous fuel. END_STATUTE Sec. 4. Section 32-1158, Arizona Revised Statutes, is amended to read: START_STATUTE32-1158. Contract requirements; provision of documents and receipt at contract signing A. Any contract in an amount of more than $1,000 $3,500 entered into between a contractor and the owner of a property to be improved shall contain in writing at least the following information: 1. The name of the contractor and the contractor's business address and license number. 2. The name and mailing address of the owner and the jobsite address or legal description. 3. The date the parties entered into the contract. 4. The estimated date of completion of all work to be performed under the contract. 5. A description of the work to be performed under the contract. 6. The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes. 7. The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner. 8. The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract. 9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar's telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1162, subsection A. The information in this paragraph must be prominently displayed in the contract in at least ten-point bold type, and the contract shall be signed by the property owner and the contractor or the contractor's designated representative. This paragraph does not apply to a person who is subject to and complies with section 12-1365. B. When a contractor and an owner sign a contract, the contractor shall provide the owner with a legible copy of all documents signed and a written and signed receipt for and in the true amount of any cash paid to the contractor by the owner. C. The requirements of this section are not prerequisites to the formation or enforcement of a contract. Failure to comply with the requirements of this section does not constitute a defense by either party to an action for compensation, damages, breach, enforcement or other cause of action based on the contract. END_STATUTE |
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| 82 | 82 | | Be it enacted by the Legislature of the State of Arizona: |
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| 84 | 84 | | Section 1. Section 32-1121, Arizona Revised Statutes, as amended by Laws 2019, chapter 140, section 1, is amended to read: |
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| 86 | 86 | | START_STATUTE32-1121. Persons not required to be licensed; penalties; applicability |
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| 88 | 88 | | A. This chapter does not apply to: |
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| 90 | 90 | | 1. An authorized representative of the United States government, this state or any county, incorporated city or town, reclamation district, irrigation district or other municipality or political subdivision of this state. |
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| 92 | 92 | | 2. Trustees of an express trust that is not formed for the purpose of conducting business as a contractor or officers of a court, if they are acting within the terms of their trust or office. |
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| 94 | 94 | | 3. Public utilities operating under regulation of the corporation commission or construction, repair or operation incidental to discovering or producing petroleum or gas, or drilling, testing, abandoning or otherwise operating a petroleum or gas well, if performed by an owner or lessee. |
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| 96 | 96 | | 4. Any materialman, manufacturer or retailer that furnishes finished products, materials or articles of merchandise and that does not install or attach such items or installs or attaches such items if the total value of the sales contract or transaction involving such items and the cost of the installation or attachment of such items to a structure does not exceed $1,000 is not more than $3,500, including labor, materials and all other items, but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure. The materialman, manufacturer or retailer shall inform the purchaser that the installation may also be performed by a licensed contractor whose name and address the purchaser may request. |
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| 98 | 98 | | 5. Owners of property who improve such property or who build or improve structures or appurtenances on such property and who do the work themselves, with their own employees or with duly licensed contractors, if the structure, group of structures or appurtenances, including the improvements thereto, are intended for occupancy solely by the owner and are not intended for occupancy by members of the public as the owner's employees or business visitors and the structures or appurtenances are not intended for sale or for rent. In all actions brought under this chapter, except an action against an owner-occupant as defined in section 33-1002, proof of the sale or rent or the offering for sale or rent of any such structure by the owner-builder within one year after completion or issuance of a certificate of occupancy is prima facie evidence that such a project was undertaken for the purpose of sale or rent. For the purposes of this paragraph, "sale" or "rent" includes any arrangement by which the owner receives compensation in money, provisions, chattels or labor from the occupancy or the transfer of the property or the structures on the property. |
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| 100 | 100 | | 6. Owners of property who are acting as developers and who build structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor licensed pursuant to this chapter and owners of property who are acting as developers, who improve structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor or specialty contractors licensed pursuant to this chapter. To qualify for the exemption under this paragraph, the licensed contractors' names and license numbers shall be included in all sales documents. |
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| 102 | 102 | | 7. Architects or engineers who are engaging in their professional practice as defined in chapter 1 of this title and who hire or offer to hire the services of a contractor for preconstruction activities relating to investigation and discovery, including: |
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| 104 | 104 | | (a) Subsurface utility location and designation services. |
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| 106 | 106 | | (b) Potholing. |
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| 108 | 108 | | (c) Drilling for any of the following: |
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| 110 | 110 | | (i) Soil samples. |
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| 112 | 112 | | (ii) Rock samples. |
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| 114 | 114 | | (iii) Pavement samples. |
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| 116 | 116 | | (d) Locating existing features of a building or structure, including existing electrical, mechanical, plumbing and structural members. |
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| 118 | 118 | | 8. A person licensed, certified or registered pursuant to title 3, chapter 20 or a person working under the direct supervision of a person certified or qualified pursuant to title 3, chapter 20 to the extent the person is engaged in pest management. |
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| 119 | 119 | | |
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| 120 | 120 | | 9. The sale or installation of finished products, materials or articles of merchandise that are not fabricated into and do not become a permanent fixed part of the structure. This exemption does not apply if a local building permit is required, if the total price of the finished product, material or article of merchandise, including labor but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, is more than $1,000 $3,500 or if the removal of the finished product, material or article of merchandise causes material damage to the structure or renders the structure unfit for its intended use. |
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| 121 | 121 | | |
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| 122 | 122 | | 10. Employees of the owners of condominiums, townhouses, cooperative units or apartment complexes of four units or less or the owners' management agent or employees of the management agent repairing or maintaining structures owned by them. |
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| 123 | 123 | | |
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| 124 | 124 | | 11. Any person who engages in the activities regulated by this chapter, as an employee of an exempt property owner or as an employee with wages as the person's sole compensation. |
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| 125 | 125 | | |
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| 126 | 126 | | 12. A surety company or companies that are authorized to transact business in this state and that undertake to complete a contract on which they issued a performance or completion bond if all construction work is performed by duly licensed contractors. |
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| 127 | 127 | | |
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| 128 | 128 | | 13. Insurance companies that are authorized to transact business in this state and that undertake to perform repairs resulting from casualty losses pursuant to the provisions of a policy if all construction work is performed by duly licensed contractors. |
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| 129 | 129 | | |
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| 130 | 130 | | 14. Any person other than a licensed contractor engaging in any work or operation on one undertaking or project by one or more contracts, for which the aggregate contract price, including labor, materials and all other items, but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, is less not more than $1,000 $3,500. The work or operations that are exempt under this paragraph shall be of a casual or minor nature. This exemption does not apply: |
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| 131 | 131 | | |
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| 132 | 132 | | (a) In any case in which the performance of the work requires a local building permit. |
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| 133 | 133 | | |
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| 134 | 134 | | (b) In any case in which the work or construction is only a part of a larger or major operation, whether undertaken by the same or a different contractor, or in which a division of the operation is made in contracts of amounts less than $1,000 of not more than $3,500, excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet using a two-pronged or three-pronged electrical connector or that has internal batteries that do not exceed twelve volts in a single, series or parallel configuration and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, for the purpose of evasion of this chapter or otherwise. |
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| 135 | 135 | | |
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| 136 | 136 | | (c) To a person who uses any form of advertising to the public in which the person's unlicensed status is not disclosed by including the words "not a licensed contractor" in the advertisement. |
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| 137 | 137 | | |
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| 138 | 138 | | 15. A person who is licensed, certified or registered pursuant to title 41, chapter 37, article 4 and who is not otherwise required to be licensed under this chapter or an employee of such person. |
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| 139 | 139 | | |
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| 140 | 140 | | 16. A person who functions as a gardener by performing lawn, garden, shrub and tree maintenance. |
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| 141 | 141 | | |
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| 142 | 142 | | 17. Alarm agents as defined in section 32-101. |
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| 143 | 143 | | |
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| 144 | 144 | | 18. Cable television, satellite television and telecommunications providers, including data and related services of cable television, satellite television and telecommunications providers including contractors and subcontractors of cable television, satellite television and telecommunications providers if the work of the contractors and subcontractors is limited to installing low-voltage cable, telephone services, internet services and data service. Installation Installing does not include digging, trenching, grading, horizontal boring, compacting or filling earthen or other material before the service drop of the commercial or residential structure. |
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| 145 | 145 | | |
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| 146 | 146 | | B. A person who is licensed to perform work in a particular trade pursuant to this chapter is not required to obtain and maintain a separate license for mechanical or structural service work the person performs within the scope of that trade. |
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| 147 | 147 | | |
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| 148 | 148 | | C. Any person who does not have an exemption from licensure pursuant to subsection A, paragraph 14, subdivision (c) of this section is subject to prosecution for a violation of section 44-1522. The attorney general may investigate the act or practice and take appropriate action pursuant to title 44, chapter 10, article 7. |
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| 149 | 149 | | |
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| 150 | 150 | | D. The exemptions from licensure pursuant to subsection A, paragraphs 4, 9 and 14 of this section do not apply to either of the following: |
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| 151 | 151 | | |
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| 152 | 152 | | 1. All fire safety and mechanical, electrical and plumbing work that is done in connection with fire safety installation and fire safety maintenance and repair. For the purposes of this paragraph, "fire safety installation" means hardwired or interconnected smoke alarms and fire sprinklers and does not include an individual device that is attached by a nail, screw or other fastening device to the frame or foundation of any residential unit. For the purposes of this paragraph, fire safety maintenance and repair does not include routine work that is conducted by an employee of an apartment or condominium complex and that is incidental to the fire safety equipment. |
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| 153 | 153 | | |
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| 154 | 154 | | 2. All work done, including installing, maintaining and repairing devices, appliances or equipment, that involves connecting to any supply of natural gas, propane or other petroleum or gaseous fuel. This paragraph does not impact the effect of section 36-1624.01.END_STATUTE |
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| 155 | 155 | | |
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| 156 | 156 | | Sec. 2. Section 32-1121, Arizona Revised Statutes, as amended by Laws 2019, chapter 145, section 5, is amended to read: |
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| 157 | 157 | | |
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| 158 | 158 | | START_STATUTE32-1121. Persons not required to be licensed; penalties; applicability |
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| 159 | 159 | | |
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| 160 | 160 | | A. This chapter does not apply to: |
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| 161 | 161 | | |
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| 162 | 162 | | 1. An authorized representative of the United States government, this state or any county, incorporated city or town, reclamation district, irrigation district or other municipality or political subdivision of this state. |
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| 163 | 163 | | |
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| 164 | 164 | | 2. Officers of a court or trustees of an express trust that is not formed for the purpose of conducting business as a contractor, if they are acting within the terms of their office or trust. |
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| 165 | 165 | | |
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| 166 | 166 | | 3. Public utilities operating under regulation of the corporation commission or construction, repair or operation incidental to discovering or producing petroleum or gas, or the drilling, testing, abandoning or other operation of a petroleum or gas well, if performed by an owner or lessee. |
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| 167 | 167 | | |
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| 168 | 168 | | 4. Except as provided in subsection D of this section, any materialman, manufacturer or retailer who informs the purchaser that the installation may also be performed by a licensed contractor whose name and address the purchaser may request, and who furnishes finished products, materials or articles of merchandise and who either: |
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| 169 | 169 | | |
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| 170 | 170 | | (a) Does not install or attach such items. |
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| 171 | 171 | | |
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| 172 | 172 | | (b) Installs or attaches such items if the total value of the sales contract or transaction involving such items and the cost of the installation or attachment of such items to a structure does not exceed $1,000 is not more than $3,500, including labor, materials and all other items, but excluding any electrical fixture or appliance that meets all of the following: |
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| 173 | 173 | | |
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| 174 | 174 | | (i) Was designed by the manufacturer. |
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| 175 | 175 | | |
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| 176 | 176 | | (ii) Is unaltered, unchanged or unmodified by any person. |
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| 177 | 177 | | |
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| 178 | 178 | | (iii) Can be plugged into a common electrical outlet. |
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| 179 | 179 | | |
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| 180 | 180 | | 5. Owners of property who improve such property or who build or improve structures or appurtenances on such property and who do the work themselves, with their own employees or with duly licensed contractors, if the structure, group of structures or appurtenances, including the improvements thereto, are intended for occupancy solely by the owner and are not intended for occupancy by members of the public as the owner's employees or business visitors and the structures or appurtenances are not intended for sale or for rent. In all actions brought under this chapter, except an action against an owner-occupant as defined in section 33-1002, proof of the sale or rent or the offering for sale or rent of any such structure by the owner-builder within one year after completion or issuance of a certificate of occupancy is prima facie evidence that such project was undertaken for the purpose of sale or rent. For the purposes of this paragraph, "sale" or "rent" includes any arrangement by which the owner receives compensation in money, provisions, chattels or labor from the occupancy or the transfer of the property or the structures on the property. |
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| 181 | 181 | | |
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| 182 | 182 | | 6. Owners of property who are acting as developers and who build structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor licensed pursuant to this chapter and owners of property who are acting as developers, who improve structures or appurtenances to structures on their property for the purpose of sale or rent and who contract for such a project with a general contractor or specialty contractors licensed pursuant to this chapter. To qualify for the exemption under this paragraph, the licensed contractors' names and license numbers must be included in all sales documents. |
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| 183 | 183 | | |
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| 184 | 184 | | 7. Architects or engineers who are engaging in their professional practice as defined in chapter 1 of this title and who hire or offer to hire the services of a contractor for preconstruction activities relating to investigation and discovery, including: |
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| 185 | 185 | | |
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| 186 | 186 | | (a) Subsurface utility location and designation services. |
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| 187 | 187 | | |
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| 188 | 188 | | (b) Potholing. |
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| 189 | 189 | | |
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| 190 | 190 | | (c) Drilling for any of the following: |
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| 191 | 191 | | |
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| 192 | 192 | | (i) Soil samples. |
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| 193 | 193 | | |
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| 194 | 194 | | (ii) Rock samples. |
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| 195 | 195 | | |
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| 196 | 196 | | (iii) Pavement samples. |
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| 197 | 197 | | |
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| 198 | 198 | | (d) Locating existing features of a building or structure, including existing electrical, mechanical, plumbing and structural members. |
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| 199 | 199 | | |
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| 200 | 200 | | 8. A person licensed, certified or registered pursuant to title 3, chapter 20 or a person working under the direct supervision of a person certified or qualified pursuant to title 3, chapter 20 to the extent the person is engaged in pest management. |
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| 201 | 201 | | |
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| 202 | 202 | | 9. Except as provided in subsection D of this section, the sale or installation of finished products, materials or articles of merchandise that are not fabricated into and do not become a permanent fixed part of the structure. This exemption does not apply if a local building permit is required, if the removal of the finished product, material or article of merchandise causes damage to the structure or renders the structure unfit for its intended use or if the total price of the finished product, material or article of merchandise is more than $1,000 $3,500, including labor but excluding any electrical fixture or appliance that meets all of the following: |
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| 203 | 203 | | |
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| 204 | 204 | | (a) Was designed by the manufacturer. |
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| 205 | 205 | | |
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| 206 | 206 | | (b) Is unaltered, unchanged or unmodified by any person. |
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| 207 | 207 | | |
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| 208 | 208 | | (c) Can be plugged into a common electrical outlet. |
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| 209 | 209 | | |
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| 210 | 210 | | 10. Employees of the owners of condominiums, townhouses, cooperative units or apartment complexes of four units or less or the owners' management agent or employees of the management agent repairing or maintaining structures owned by them. |
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| 211 | 211 | | |
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| 212 | 212 | | 11. Any person who engages in the activities regulated by this chapter, as an employee of an exempt property owner or as an employee with wages as the person's sole compensation. |
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| 213 | 213 | | |
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| 214 | 214 | | 12. A surety company or companies that are authorized to transact business in this state and that undertake to complete a contract on which they issued a performance or completion bond, if construction work is performed by duly licensed contractors. |
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| 215 | 215 | | |
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| 216 | 216 | | 13. Insurance companies that are authorized to transact business in this state and that undertake to perform repairs resulting from casualty losses pursuant to the provisions of a policy, if construction work is performed by duly licensed contractors. |
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| 217 | 217 | | |
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| 218 | 218 | | 14. Except as provided in subsection D of this section, any person other than a licensed contractor engaging in any work or operation on one undertaking or project by one or more contracts, for which the aggregate contract price is less not more than $1,000 $3,500, including labor, materials and all other items, but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person and that can be plugged into a common electrical outlet. The work or operations that are exempt under this paragraph must be of a casual or minor nature. This exemption does not apply: |
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| 219 | 219 | | |
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| 220 | 220 | | (a) In any case in which the performance of the work requires a local building permit. |
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| 221 | 221 | | |
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| 222 | 222 | | (b) In any case in which the work or construction is only a part of a larger or major operation, whether undertaken by the same or a different contractor, or in which a division of the operation is made in contracts of amounts less than $1,000 of not more than $3,500, excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person and that can be plugged into a common electrical outlet. |
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| 223 | 223 | | |
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| 224 | 224 | | (c) To a person who utilizes any form of advertising to the public in which the person's unlicensed status is not disclosed by including the words "not a licensed contractor" in the advertisement. |
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| 225 | 225 | | |
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| 226 | 226 | | 15. A person who is licensed, certified or registered pursuant to title 41, chapter 37, article 4 and who is not otherwise required to be licensed under this chapter or an employee of such person. |
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| 227 | 227 | | |
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| 228 | 228 | | 16. A person who functions as a gardener by performing lawn, garden, shrub and tree maintenance. |
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| 229 | 229 | | |
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| 230 | 230 | | 17. Alarm agents as defined in section 32-101. |
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| 231 | 231 | | |
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| 232 | 232 | | B. A person who is licensed to perform work in a particular trade pursuant to this chapter is not required to obtain and maintain a separate license for mechanical or structural service work performed within the scope of such trade by such person. |
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| 233 | 233 | | |
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| 234 | 234 | | C. Any person who does not have an exemption from licensure pursuant to subsection A, paragraph 14, subdivision (c) of this section is subject to prosecution for a violation of section 44-1522. The attorney general may investigate the act or practice and take appropriate action pursuant to title 44, chapter 10, article 7. |
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| 235 | 235 | | |
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| 236 | 236 | | D. The exemptions from licensure pursuant to subsection A, paragraphs 4, 9 and 14 of this section do not apply to either of the following: |
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| 237 | 237 | | |
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| 238 | 238 | | 1. All fire safety and mechanical, electrical and plumbing work that is done in connection with fire safety installation and fire safety maintenance and repair. For the purposes of this paragraph, "fire safety installation" means hardwired or interconnected smoke alarms and fire sprinklers and does not include an individual device that is attached by a nail, screw or other fastening device to the frame or foundation of any residential unit. For the purposes of this paragraph, fire safety maintenance and repair does not include routine work that is conducted by an employee of an apartment or condominium complex and that is incidental to the fire safety equipment. |
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| 239 | 239 | | |
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| 240 | 240 | | 2. All work that is done, including the installation, maintenance and repair of devices, appliances or equipment, that involves the connecting to any supply of natural gas, propane or other petroleum or gaseous fuel. Nothing in this paragraph impacts the effect of section 36-1624.01. |
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| 241 | 241 | | |
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| 242 | 242 | | E. A joint venture or other combination of persons, firms, partnerships, corporations, associations or other organizations is not required to obtain a separate contractor's license in its own name if all of the following apply: |
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| 243 | 243 | | |
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| 244 | 244 | | 1. At least one member of the joint venture or combination holds a contractor's license in good standing with the registrar. |
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| 245 | 245 | | |
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| 246 | 246 | | 2. Each member of the joint venture or combination that acts as a contractor holds a license in good standing with the registrar. |
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| 247 | 247 | | |
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| 248 | 248 | | 3. Each licensed member of the joint venture or combination only performs work within the scope of that member's contractor's license or licenses. END_STATUTE |
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| 249 | 249 | | |
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| 250 | 250 | | Sec. 3. Section 32-1123, Arizona Revised Statutes, is amended to read: |
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| 251 | 251 | | |
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| 252 | 252 | | START_STATUTE32-1123. Unlicensed contractors; contract bidding; license denial; exemptions; warning |
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| 253 | 253 | | |
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| 254 | 254 | | A. Except as provided in subsection D of this section, if an entity that is not licensed or not properly licensed pursuant to this chapter bids on a contract for a project with an aggregate worth of more than $1,000 $3,500, the registrar may not issue the entity a license for one year after the bid date. For the purposes of this subsection, aggregate worth does not include any electrical fixture or appliance that meets all of the following: |
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| 255 | 255 | | |
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| 256 | 256 | | 1. Was designed by the manufacturer. |
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| 257 | 257 | | |
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| 258 | 258 | | 2. Is unaltered, unchanged or unmodified by any person. |
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| 259 | 259 | | |
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| 260 | 260 | | 3. Can be plugged into a common electrical outlet. |
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| 261 | 261 | | |
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| 262 | 262 | | 4. Does not involve the connection to a supply of natural gas, propane or other petroleum or gaseous fuel. |
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| 263 | 263 | | |
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| 264 | 264 | | B. This section does not apply to an entity that bids on a contract for either of the following: |
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| 265 | 265 | | |
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| 266 | 266 | | 1. A department of transportation project. |
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| 267 | 267 | | |
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| 268 | 268 | | 2. A project that is subject to the federal acquisition regulation, title 48 Code of Federal Regulations, including the department of defense federal acquisition regulation. |
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| 269 | 269 | | |
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| 270 | 270 | | C. This section does not affect the licensing exemptions prescribed in section 32-1121. |
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| 271 | 271 | | |
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| 272 | 272 | | D. The registrar shall issue an entity a written warning relating to unlicensed activity if the registrar has not previously issued the entity a warning and if the entity bids on a contract for a project pursuant to subsection A of this section and the project has an aggregate worth of more than $1,000 $3,500 but less than $20,000, excluding any electrical fixture or appliance that meets all of the following: |
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| 273 | 273 | | |
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| 274 | 274 | | 1. Was designed by the manufacturer. |
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| 275 | 275 | | |
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| 276 | 276 | | 2. Is unaltered, unchanged or unmodified by any person. |
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| 277 | 277 | | |
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| 278 | 278 | | 3. Can be plugged into a common electrical outlet. |
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| 279 | 279 | | |
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| 280 | 280 | | 4. Does not involve the connection to a supply of natural gas, propane or other petroleum or gaseous fuel. END_STATUTE |
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| 281 | 281 | | |
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| 282 | 282 | | Sec. 4. Section 32-1158, Arizona Revised Statutes, is amended to read: |
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| 283 | 283 | | |
|---|
| 284 | 284 | | START_STATUTE32-1158. Contract requirements; provision of documents and receipt at contract signing |
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| 285 | 285 | | |
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| 286 | 286 | | A. Any contract in an amount of more than $1,000 $3,500 entered into between a contractor and the owner of a property to be improved shall contain in writing at least the following information: |
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| 287 | 287 | | |
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| 288 | 288 | | 1. The name of the contractor and the contractor's business address and license number. |
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| 289 | 289 | | |
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| 290 | 290 | | 2. The name and mailing address of the owner and the jobsite address or legal description. |
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| 291 | 291 | | |
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| 292 | 292 | | 3. The date the parties entered into the contract. |
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| 293 | 293 | | |
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| 294 | 294 | | 4. The estimated date of completion of all work to be performed under the contract. |
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| 295 | 295 | | |
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| 296 | 296 | | 5. A description of the work to be performed under the contract. |
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| 297 | 297 | | |
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| 298 | 298 | | 6. The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes. |
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| 299 | 299 | | |
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| 300 | 300 | | 7. The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner. |
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| 301 | 301 | | |
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| 302 | 302 | | 8. The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract. |
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| 303 | 303 | | |
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| 304 | 304 | | 9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar's telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1162, subsection A. The information in this paragraph must be prominently displayed in the contract in at least ten-point bold type, and the contract shall be signed by the property owner and the contractor or the contractor's designated representative. This paragraph does not apply to a person who is subject to and complies with section 12-1365. |
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| 305 | 305 | | |
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| 306 | 306 | | B. When a contractor and an owner sign a contract, the contractor shall provide the owner with a legible copy of all documents signed and a written and signed receipt for and in the true amount of any cash paid to the contractor by the owner. |
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| 307 | 307 | | |
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| 308 | 308 | | C. The requirements of this section are not prerequisites to the formation or enforcement of a contract. Failure to comply with the requirements of this section does not constitute a defense by either party to an action for compensation, damages, breach, enforcement or other cause of action based on the contract. END_STATUTE |
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