Contractor Licensing Laws and How an Arizona ROC Complaint Attorney Can Help

Data from the US Bureau of Labor Statistics shows that in the Third Quarter of 2024, Arizona had 17,709 private businesses operating in the construction industry. Each of them holds a contracting license, as operating without one could have business-stalling, or ending, legal implications.

If you’re a commercial contractor, project owner, developer, or someone considering this career path, below is a complete guide to the licensing laws and requirements you must comply with. Otherwise, you risk criminal misdemeanor charges, penalties up to $10,000 per violation, and civil lawsuits, among other consequences.

Who Regulates and Licenses Commercial Contractors in Arizona?

Arizona imposes contractor licensing under Title 32, Chapter 10, of the Arizona Revised Statutes (A.R.S.), which the Arizona Registrar of Contractors (ROC) oversees. The ROC is responsible for issuing licenses, delineating classifications, setting qualifications, monitoring compliance, and enforcing penalties. This state-run agency also issues rules in the Arizona Administrative Code (e.g., R4‑9‑102) that specify the scopes of work under each license classification.

Classifications of Contractor Licenses and Scope of Permitted Work

Contractor licenses have six classifications: commercial, residential, general, dual, specialty, and engineering. For commercial projects, A.R.S. § 32‑1102 notes the following categories:

1. General commercial building contracting: Construction of any structure on commercial property intended for the support, shelter, or enclosure of persons, animals, or movable property. This category also includes supervision of the work, whether in whole or in part.
2. General engineering contracting: Construction of fixed structures requiring specialized engineering knowledge, including but not limited to roads, utilities, bridges, tunnels, flood control systems, water power facilities, and transmission lines.
3. Specialty commercial contracting: Any work requiring specialized skill and expertise in designated trades or crafts, such as electrical, plumbing, concrete, and roofing.
4. Dual licensed contracting: Authorization to perform work that combines classifications, such as commercial and residential or specialty and general, within the scope permitted by the Registrar of Contractors.

License classifications under R4-9-102 identify multiple commercial license types within these categories, including A-General Engineering, B-General Commercial Contracting, and C-Specialty Commercial trades such as concrete, drywall, and electrical.

In another article, we discussed the Types of Commercial Contractor Licenses, which refer to the specific licenses issued by the Arizona ROC. To clarify, these differ from the broader Classifications of Contractor Licenses and Scope of Work above, which describe the general categories of construction activity recognized under Arizona law.

In simpler terms:

• Classifications: Broad categories of construction activity (the “what”)
• Types of Licenses: Specific license designations within those classifications (the “how and under what limits”)

Together, they govern who may build what, and under what authority, in Arizona.

Is There a Penalty for Working Without a Contractor’s License in Arizona?

Under A.R.S. § 32-1151, it is unlawful to act as a contractor without proper licensure. Violations may result in civil penalties, administrative sanctions by the Arizona Registrar of Contractors, or criminal charges. Authorities may also prohibit contractors from suing to collect payment for unlicensed work performed.

Since these penalties can affect contractors and project owners alike, ensure compliance before starting any project. For uncertainties about which license or classification applies, or if you are subject to an enforcement action, seek legal assistance from FR Law Group. Our commercial construction lawyers can help protect your rights and prevent costly consequences.

Learn more about the risks of contracting without a license in Arizona.

How to Get an Arizona Contractor License

To lawfully operate as a contractor and avoid ROC licensing complaints, individuals or contracting businesses must complete these steps:

1. Designate a qualifying party: Each license must identify a qualifying party or a person with the requisite experience, knowledge, and skills for the classification sought. This person may be a proprietor, partner, member, officer, or employee of the business.
2. Pass exams: The qualifying party must pass the Statutes and Rules (SRE) examination and, if applicable, a trade-specific examination. The ROC may waive the trade exam if the applicant previously held an equivalent license or classification within the past five years.
3. Complete a background check: All persons named on the application must undergo a background check as part of the licensing process.
4. Form a legal business entity: Indicate whether the contracting business is a sole proprietorship, partnership, corporation, or limited liability company (LLC). Register the entity with the Arizona Corporation Commission, when applicable, and maintain it in good standing.
5. Obtain the required bond: Applicants must submit proof of a contractor’s license bond or cash deposit in the amount required by statute, based on license type and anticipated volume of work.
6. Pay all fees: Pay the required application, examination, and licensing fees to the ROC.

All individuals listed on the application, including the qualifying party, must be at least 18 years of age.

For complete details and current requirements, please visit the Arizona Registrar of Contractors.

Obligations After Licensing

Once licensed, contractors must:

• Renew the license every two years.
• Maintain the required insurance, including any workers’ compensation coverage, and keep the contractor’s bond active.
• Display the license number and company name in all advertising, and ensure advertising does not offer or suggest services outside the license scope.
• Comply with contract requirements under A.R.S. § 32-1158, including the state’s specific contract terms.

Failure to meet these ongoing obligations can expose contractors to complaints, disciplinary action, or even license suspension or revocation.

Arizona ROC Complaint Lawyer for Commercial Contractors, Developers, and More

Construction law, claims, and litigation are among our areas of expertise.

If you need legal guidance on ROC licensing compliance, contract formation, dispute resolution, or regulatory risk, FR Law Group advises and represents investors, contractors, architects, material suppliers, and others across all project phases, from early planning to the thousands of steps in between.

On the other hand, if you mistakenly hired an unlicensed contractor, our attorneys can step in to protect your interests. Work with us to mitigate or respond to the legal and financial strains that may arise, including unenforceable agreements, payment disputes, or regulatory actions. Our team will identify remedies, resolve disputes efficiently, and implement strategies to evade similar issues in future projects.

Call FR Law Group at 602-691-5350 or send a message to meet with a commercial construction litigation attorney in Phoenix.