Relating to public employee retirement.

2025 Regular Session Introduced by Chris Gorsek

Arizona lowers initial residential contractor license fee to 370 and biennial renewal to 270, with a 50% reduction if the recovery fund exceeds 15M, lasting until under 10M.

In committee upon adjournment.

Purpose / Intent

SB 1087 amends Arizona Revised Statutes §32-1126 (fees for contractor licensing) to change the assessment amounts collected from persons applying for or renewing residential contractor licenses and to add an automatic, fund-balance–based temporary fee-reduction mechanism for the residential contractors’ recovery fund.

Key provisions

Amends A.R.S. §32-1126 (fees).

Assessment amounts for residential contractor licenses (deposited in the residential contractors’ recovery fund, A.R.S. §32-1132):

Initial (first) residential license assessment set at $370 (text replaces higher previous figure).
Biennial license renewal assessment set at $270.

If the registrar does not issue the license, the assessment is returned to the applicant (unchanged).

New automatic adjustment rule (subsection H):

If, at the end of a fiscal year, the residential contractors’ recovery fund balance exceeds $15,000,000, the assessments required in subsection G are reduced by 50%.
The reduced assessment remains in effect until the fund balance at the end of a subsequent fiscal year falls below $10,000,000. At that point, assessments are reinstated to the full amounts in subsection G.

Other existing fee provisions in §32-1126 (application, renewal, exam, penalties, and registrar authority) remain in place; the bill targets residential-contractor assessment amounts and adds the fund-balance trigger.

Who is affected

Primary: Applicants for and holders of residential contractor licenses (general residential and applicable subclassifications) in Arizona — both new licensees and those renewing on the biennial cycle.

Secondary: The Arizona Registrar of Contractors (administration of fee collection and fund), and claimants/beneficiaries of the residential contractors’ recovery fund (because assessment changes alter fund inflows).

Fiscal / practical impact

Lowers the upfront assessment for new residential-license applicants relative to the higher amount in prior text (savings of roughly $230 per initial applicant if comparing $600 to $370).

Introduces an automatic, automatic 50% assessment reduction when the recovery fund is well-funded (> $15M), which will temporarily reduce inflows to the recovery fund until the balance drops under $10M.

The adjustment mechanism aims to limit over-accumulation in the recovery fund while preserving the ability to restore full assessments if the fund needs replenishment.

Procedural status & timeline (as provided)

Introduced: February 4, 2025.

Referred to Economic Development; committee hearings and votes occurred in March–April 2025.

Reported favorably without amendments (May 5, 2025); placed on intent calendar (May 7, 2025); not again placed on intent calendar (May 20, 2025).

Current status noted as: Rule 3-9(a) / Re-referred to Assignments.

Note: The bill text package included unrelated inserts (material from other jurisdictions concerning airport corporations and a technical Telegraph Act fix). The summary above focuses on the Arizona statute amendment to §32-1126 concerning residential contractor assessments and the recovery fund.

Bill