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Construction Law

Compliance Update: Arizona Registrar of Contractors

The ROC's tougher licensing process is at the top of the "heads up" list for Arizona contractors.

Mike Thal

May 2013 — The Arizona Registrar of Contractors (ROC) has implemented a number of important policy changes that affect all Arizona contractors. Because the ROCís interpretation of its own rules has the force of law, a contractorís failure to keep informed of how the ROC is enforcing its regulations can have very serious consequences.

Observing the following tips will help you avoid licensing-related problems.


This article appeared in the May 2013 "Construction Advisor" published by Lang & Klain and was updated in April 2014.

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Be prepared for a more demanding ROC license application.

The ROC has greatly expanded the information required in its license application and its application to substitute a qualifying party. For example, every individual "named" on the license, including every owner and officer of a corporate licensee, must provide verified copies of their driverís license. Applicants should also be anticipate criminal background checks.

In addition, the ROC has increased its scrutiny of applicant and qualifying party experience. With respect to substitution of qualifying parties, failure to do so within the allowed time will result in immediate suspension of the license; therefore, begin the application process as soon as possible.

The new applications and instructions can be found at the ROC's website.

Donít let a non-employee work under your license.

No matter how clever you are, you cannot find a way to "share" your license with an unlicensed contractor in such a way that you can escape the ROCís scrutiny. "Aiding and abetting" unlicensed persons to contract without a license can result in revocation of a license under A.R.S. ß 32-1157.

Make sure your contracts meet statutory requirements.

Every Arizona contract between a contractor and a property owner for services of $1,000 or more must be written and must contain certain information, as set forth in A.R.S. ß 32-1158(B). (Additional requirements apply to contracts for residential swimming pool construction and, under certain circumstances, for repairs of storm-related damage.)

  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. Notice 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 32-1155, 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.

For more on this topic, see our March 2012 article, "Negotiating a Construction Contract: Tips and Reminders." Also, contractors need to be aware of the consequences for omitting any of the required contract elements listed above; see "ROC Enforcement: Contract Errors Can Trigger Sanctions."

Keep your ROC contact information up to date.

Advise the ROC immediately when your address changes, and make sure that someone in your company is receiving and promptly opening your mail from the ROC. This is not just a good idea; failure to do this can put you out of business.

When a complaint is filed against your license, or when a renewal fee is due, the ROC is required only to mail notice to the address it has on file for you. In the case of a Citation and Complaint, you have 15 days to file a written answer; if you have moved without advising the ROC or are out of the office for an extended period, you can easily miss the notice and fail to answer before the deadline.

If you miss the deadline, you have no recourse; the ROC will not give you a hearing, and you cannot appeal. In addition, if your license is revoked, it cannot be revived; you must apply for a new license.

Put your license number on all business stationery.

Anything that has your name on it should also include your license number. The ROC will not bring a separate complaint for the omission, but it may use the omission as an aggravating circumstance in disciplinary proceedings that are brought on other grounds. (See our April 2002 Construction Advisor article, "Tough Penalties for Failure to Show Arizona License Number.")

Maintain a sufficient bond.

The amount of the required ROC bond depends on the annual amount of business you anticipate. Although the ROC will not bring a separate disciplinary action for failing to maintain a sufficient bond, it can consider your failure to comply with bond requirements as an aggravating circumstance in disciplinary proceeding on other grounds.