Q: Are contractors required to be licensed in Idaho?
A: The 58th Idaho Legislature passed, and the Governor signed, the Idaho Contractor Registration Act, which required contractors to be registered by January 1, 2006. The Act requires registration, not licensure.
The State of Idaho has created these registration requirements in the interest of protecting the health, safety, and welfare of Idaho’s public. The law provides a mechanism to remove from practice those incompetent, dishonest, or unprincipled practitioners of construction. The Idaho Contractors Board will enforce the requirements and will adopt and implement new rules to do so.
Q: Who must register?
A: Any person who engages in a construction job with a dollar amount exceeding $2000.00 (materials & labor) and is not otherwise exempt (The exemptions are listed below);
- Existing License: If you are a licensed as a public works contractor or as a construction manager, you may register if you are engaged in construction outside the scope of your public works license, but you are exempt from paying the fee. If you are licensed as an Architect, Electrical Contractor, Engineer or Surveyor, Plumber, Manufactured Home Installer, Service Company Contractor, HVAC installer, etc. you do not have to register, unless you are engaged in contracting beyond the scope of your license.
- Employees: Employees of contractors who are paid in wages are exempt from registration.
- Suppliers: Suppliers who do not install or fabricate the materials are exempt from registration.
- Owners: Owners who do their own work on their own land and do not intend to sell the property within 12 months are exempt from registration.
- Commercial Buildings: Commercial building owners who maintain their own buildings with their own crews are exempt from registration.
Q: How do I register?
A: You must complete a registration application(available by mail or on the web), provide the requested documentation and pay a fee. The application requires the submission of supplemental documents that must be received before your registration can be considered.
Q: What information does the application require?
A: The following information must be provided:
- Social security number for an individual or an employer tax identification number for a business.
- The name and address under which the applicant conducts business.
- The name and address of each principal, member, partner, shareholder, or any other person claiming an ownership interest in the business entity for which registration is being applied for.
- A certificate issued by an insurance company authorized to do business in the state of Idaho or other satisfactory proof that the applicant has procured and has in effect worker’s compensation insurance or a statement by the contractor as to why such certificate or coverage is not required for the applicant.
- A certificate issued by an insurance company authorized to do business in the state of Idaho that the applicant has procured and has in effect a general liability policy, including products and continued operations insurance covering the applicant’s construction operations in the sum of not less than $300,000 single limit.
- A statement of the type of construction to be undertaken by the applicant, or such other information as may be required by the board pursuant to administrative rules adopted by the Board.
- A statement that the applicant and each principal, member, partner, shareholder, or any other person claiming an ownership interest in the business entity for which registration is being applied for herein has never been denied or had revoked a contractor’s license or registration privilege in this or any other state or, if a license or registration privilege has been denied or revoked in this or any other state, an explanation of any such denial or revocation.
Q: Who approves the applications?
A: The Idaho Board of Contractors. The Board consists of five members who are appointed by the Governor. The Board is made up of four members who are contractors, and one member of the public at large.
Q: Once I am registered, what do I need to do?
A: You must prominently display your registration number, within 60 days of registration, at your place of business and jobsite, and on all advertising, contracts, building permits, letterheads, purchase orders and subcontracts.
Q: How often do I have to renew my registration?
A: Initial registrations will be valid for 12 months after your next birthday. Renewal will be required annually. Each registrant will receive a renewal notice approximately six weeks before the expiration date printed on the registration card. Active members of the military may be eligible for a waiver of renewal fees and other renewal requirements; see Idaho Code 67-2602A.
Q: What if I am not exempt and I practice without a license?
A: If you fail to register and practice, the following penalties apply:
- No Building Permits – You cannot obtain a building permit.
- No Lien Rights – You waive any right to a lien on real property.
- No Contract Rights – You lose your right to sue to collect money for your work under any contract for which you were required to be registered.
- Misdemeanor: Any person acting in the capacity of a contractor as defined and who does not have a current registration as required shall be guilty of a misdemeanor. Upon conviction, each violation shall be punished by a fine of no more than $1,000 or by imprisonment in the county jail for a term not to exceed six (6) months, or by both, in the discretion of the court.
Q: What happens if other contractors on the job are not registered?
A: If there are other contractors, subcontractors or persons performing construction on the job, you must obtain “satisfactory proof” that everyone you engage on the job is registered. Failure to do so violates the Act. You could also lose your lien rights. If you work for, or supply materials to, someone that you know is not registered even though they should be, you lose your lien rights.
Q: How can my registration be revoked?
A: Your registration can be revoked for many reasons. The more pertinent reasons are:
- Violate Act: You fail to follow any rules relating to registration that are set forth by the legislature or by the Idaho Contractors Board (for example, fail to provide workers compensation or liability insurance).
- Violate Consumer Protection Act: You violate Idaho’s Consumer Protection Act (for example, making misleading statements).
- Dishonesty: Your conduct constitutes “dishonest or dishonorable dealings”.
Q: Are there disclosure laws for contractors?
A: Yes. Idaho law requires general contractors to provide certain disclosures to owners and purchasers of residential real property. The Idaho Contractors Board provides the following guidance to registered contractors to facilitate compliance with Idaho law:
Initial Disclosure
Section 45-525(2), Idaho Code requires a general contractor to provide a disclosure statement, prior to entering into a contract in excess of $2,000 with a homeowner or purchaser of residential real property to construct, alter or repair any improvements on residential real property, or for the purchase and sale of newly constructed property. The general contractor must also obtain and retain a receipt for the disclosure, signed by homeowner or purchaser. The statement must include the following disclosures:
- The homeowner or purchaser has the right, at their reasonable expense, to require the general contractor to obtain lien waivers from any subcontractors providing services or materials to the general contractor.
- The homeowner or purchaser has the right to receive from the general contractor proof that the general contractor has in effect a general liability insurance policy including completed operations and workers’ compensation insurance for employees as required by Idaho law.
- The homeowner or purchaser must be informed of the opportunity to purchase an extended policy of title insurance covering certain unfilled or unrecorded liens.
- The homeowner or purchaser has the right to require, at their expense, a surety bond in an amount up to the value of the construction project.
Disclosure Upon Completion
Section 54-525(3), Idaho Code requires a general contractor to provide to a homeowner or purchaser of residential real property an additional disclosure statement, within a reasonable time either (1) prior to receipt of final payment from the homeowner or purchaser for construction, alteration, or repair of any improvement of residential real property, or (2) prior to closing on a purchase and sales agreement with a prospective purchaser. The following requirements apply:
- The general contractor must sign the disclosure statement.
- The disclosure statement must list the business names, addresses and telephone numbers of all subcontractors, materialmen and rental equipment providers who have a direct contractual relationship with the general contractor and who supplied materials or performed work on the residential property of a value in excess of $500.
- Subcontractors, materialmen, and rental equipment providers listed in the disclosure statement are authorized to disclose balances owed to the homeowner or purchaser and their agents.
- The general contractor is not liable for any error, inaccuracy or omission of any information delivered pursuant to Section 45-525(3), Idaho Code if the error, inaccuracy, or omission was not within the general contractor’s personal knowledge.
Pursuant to Section 45-525(4), Idaho Code failure to provide the disclosures required by Idaho Law constitutes an unlawful and deceptive act or practice in trade or commerce under the Idaho Consumer Protection Act, Chapter 6, Title 48, Idaho Code. The Board may discipline a registered contractor for a violation of the Idaho Consumer Protection Act pursuant to Section 54-5215(2)(b), Idaho Code.
