Hawaii Contractor License Exam — All Questions

What consumer-protection mechanism, funded by Hawaii licensees, can compensate consumers harmed by a licensed contractor's misconduct?

• a.A federal insurance pool administered by OSHA
• b.The county building department's general fund
• c.The Contractors Recovery Fund, into which licensees contribute (HRS §444-16.5)✓
• d.There is no such mechanism in Hawaii

Hawaii maintains a Contractors Recovery Fund (HRS §444-16.5 and related sections) supported by licensee contributions. It can pay consumers harmed by a licensed contractor's misconduct up to statutory limits, and the contractor must reimburse the fund for any payout made on their account.HRS §444-16.5 (Contractors Recovery Fund)

Under Hawaii's Workers' Compensation Law (HRS Chapter 386), an employer generally must carry workers' compensation coverage once it employs how many workers?

• a.One or more employees✓
• b.Three or more employees
• c.Five or more employees
• d.Ten or more employees

Hawaii requires workers' compensation coverage for employers with one or more employees under HRS Chapter 386. This single-employee trigger is stricter than states that begin the requirement at three workers, so coverage should be in place as soon as the first employee is hired.HRS Ch. 386 (Workers' Compensation)

A candidate is preparing for the Hawaii Business and Law exam. Which study approach matches the exam's format?

• a.Rely on tabbing an open reference book to look up every answer
• b.Plan to bring the NASCLA guide into the exam room
• c.Assume a 60% passing score allows guessing
• d.Memorize the licensing law, lien rules, and tax basics, because the exam is closed book at a 75% passing score✓

Because the Hawaii exam is closed book with a 75% passing score, candidates cannot look answers up during the test. Effective preparation means committing HRS Chapter 444 licensing rules, lien procedure, and General Excise Tax basics to memory.CILB examination format

How is the NASCLA Contractors Guide used in Hawaii's licensing process?

• a.As an open-book reference candidates may bring into the Hawaii exam
• b.Only as source material for Hawaii's own closed-book exams — it does not substitute for the Hawaii trade exam✓
• c.As a substitute that waives the Hawaii Business and Law exam
• d.It has no role of any kind in Hawaii

Hawaii runs its own Class A, B, and C examinations and does not accept the NASCLA exam. The NASCLA guide is used only as background source material for content; it is not brought into Hawaii's closed-book exams and does not waive any Hawaii examination.HRS Ch. 444 (approved source material)

Before doing business in Hawaii, a contractor should register for which state tax account?

• a.A General Excise Tax (GET) license with the Department of Taxation✓
• b.A retail sales tax permit, because Hawaii's rate is 6%
• c.No account, because construction is tax-exempt in Hawaii
• d.A federal excise-only account with the IRS

Because Hawaii taxes business gross income through the General Excise Tax (HRS Chapter 237) rather than a sales tax, a contractor must obtain a GET license and remit GET on gross receipts. Failing to register and pay GET is a common compliance gap for new Hawaii contractors.HRS Ch. 237 (GET license)