Arizona Contractor License Exam — All Questions

The Arizona Residential Contractors' Recovery Fund can compensate an owner only when the owner:

• a.Is any homeowner, even one who hired an unlicensed handyman
• b.Is a commercial property owner on a large project
• c.Contracted with a LICENSED residential contractor and was damaged by that contractor's failure to perform or a violation of the licensing law✓
• d.Simply changed their mind about the project

The Residential Contractors' Recovery Fund reimburses an owner of a residential structure who was damaged by a licensed residential contractor's failure to perform or violation, when the owner cannot otherwise collect. It applies only to owners who used a licensed contractor.A.R.S. §32-1131 et seq. (Residential Contractors' Recovery Fund)

A homeowner hires an UNLICENSED person who takes a deposit and abandons the job. Can the homeowner recover from the Residential Contractors' Recovery Fund?

• a.No; the Recovery Fund protects only owners who hired a licensed residential contractor✓
• b.Yes; the fund covers all contractors, licensed or not
• c.Yes; the fund even doubles the award when the work was done unlicensed
• d.Only if the unlicensed person held a city business license

The Recovery Fund is funded by and tied to licensed contractors, so it does not cover work performed by an unlicensed person. This is a key reason Arizona urges owners to confirm a contractor's ROC license before hiring.A.R.S. §32-1132 (eligibility requires a licensed contractor)

How is the Arizona Residential Contractors' Recovery Fund financed?

• a.By a state sales tax on lumber and building materials
• b.By federal construction grants
• c.By homeowners' association dues
• d.By assessments and fees paid by licensed residential contractors✓

The fund is financed through assessments and fees paid by licensed residential contractors as part of licensure. Because the contractors themselves fund it, only owners who dealt with a licensed residential contractor can draw on it.A.R.S. §32-1132 (assessments funding the Recovery Fund)