Contractor bonds increase on July 1
June 17, 2024
General and specialty contractor bonds increase on July 1 under a bill the legislature unanimously approved in 2023.
Contractor bonds increase
House Bill 1534 increased the required bond amount for initial and renewal contractor registrations occurring on or after July 1, 2024.
The required bond amount for general contractors will be $30,000 and specialty contractors will pay $15,000. The legislation requires one-half of the bond amount to be protected for residential homeowners.
The Department of Labor & Industries has clarified that if a contractor’s bond expires and they renew before July 1, 2024, they don’t need to increase their bond or assignment of savings until the next time they renew in two years. Similarly, if a contractor’s bond expires after July 1, 2024, there’s no need to increase the bond until their next renewal. They don’t have to renew early.
See L&I’s FAQs for more information.
Increase helps protect homeowners and good contractors
Supporters of HB 1534 testified they needed the legislation to protect current and future homeowners from unscrupulous contractors. One veteran couple said they saved over $67,000 to remodel their home. They said they paid the contractor and the contractor never did the work. In another example, a homeowner said she paid a contractor $100,000 to remodel her home, but the contractor never completed the work. The homeowner said they then had to pay a second contractor $100,000 to complete the work.
Both homeowners said they did their due diligence before hiring the contractor and verified registration. Unfortunately, they said, the contractors used deceptive advertising, requested large down payments and offered discounts for cash payments.
To help these consumers, the bill establishes a Homeowner Recovery Program to help homeowners recover from fraudulent or faulty contractors. The bill funds the program through increased fines and penalties for failure to register as a contractor. The fine increases from $1,200 to $10,000 under this bill.
Both businesses and homeowners supported the bill.