In order to become a general contractor in Arkansas, you’ll need to satisfy specific requirements set forth by the Arkansas Contractors Licensing Board. The following guide will list all of them, and walk you through the process of applying for a Contractors License in the State of Arkansas. For information on other trades, see the licensing requirements for becoming a plumber or an electrician in Arkansas.
Arkansas Contractor License Requirements
Arkansas’s general contractor licensing requirements are relatively tame compared to other states. A completed application, passing score on an exam, a certificate insurance and bond insurance are all included as a part of these requirements.
Who Needs a Contractors License?
According to Arkansas State Licensing Law, a “contractor” means any person or organization who submits a bid to construct or demolish, when the cost of the project is over $50,000. While the verbiage used in the actual text is much lengthier, this is the basic benchmark.
Any contractor who practices without a license is guilty of a misdemeanor and liable for a fine of between $100 and $200 per day worked under these conditions.
What Do You Need To Become a General Contractor in Arkansas?
When applying for a contractors license in Arkansas, you’ll have to satisfy these requirements:
- Complete your application. Depending on the projected sizes of your projects, you’ll have to decide which application to complete:
- Restricted Commercial License: These licenses are for commercial projects that are less than $750,000 including, but not limited to, labor and materials.
- Commercial License: These licenses are good for commercial projects of any size.
- Appropriate business style affidavit and affidavit regarding bidding. This is must be signed and notarized within the last 90 days.
- Filing Fee. $100.00 non-refundable filing fee made payable to the Contractors Licensing Board.
- Three written references. These cannot be from a supplier or banker, unless they actually observed and can describe your work. The individuals giving the references must complete these forms themselves, and references must not be more than 90 days old.
- Copy of Arkansas Business and Law passing test score. Licenses can be approved but not released without a passing test score.
- Contractor’s Bond. Licenses can be approved but not released until a fully executed Contractor’s Bond in the amount of $10,000 is filed with the board. You can obtain contractor bonds from bonding companies or through some insurance providers.
- An Independent CPA report.
- Those applying for a Restricted License must submit a compiled report, including:
- Report letter from an Independent CPA
- Balance sheet prepared in accordance with GAAP or on an Income Tax Basis (Accrual Method)
- Footnotes not required
- Those applying for a Contractor License must submit a reviewed or audited report, including:
- Reviewed or Audited opinion letter from an Independent CPA
- Balance sheet prepared in accordance with GAAP or on an Income Tax Basis (Accrual Method)
- All footnotes to the balance sheet.
- REFER TO Rules and Regulations Act 150 (224-25-6). One half (1/2) of the net worth requirement for the classification(s) / specialty(s) requested must be CASH in the bank and cannot be a stockholder note to the company or receivables. Example: If asking for the Building classification, the net worth requirement is $50,000 half of that $25,000 will need to be cash in the bank. If asking for a specialty (s), the net worth requirement is $5,000 half of that $2,500 will need to be cash in the bank.
- Those applying for a Restricted License must submit a compiled report, including:
- Copy of Articles/Filings. If applying as a Corporation, LLC, or LP, send a copy of your entity’s Articles/Filings from Secretary of State’s Office.
- Proof of Insurance. General liability and worker’s compensation insurance is required for all types of contractors in the state of Arkansas.
Applicants applying for both Commercial and Residential Licenses will need to complete a New Application for Residential License, though no additional fee or test is required.
Licensing and Registration Fee Summary
The amount that Arkansas general contractors will have to pay for licensure and exam fees is:
- Filing Fee (non-refundable): $100.00
- Exam Fee: $80.00
- Total: $180.00
It’s worth noting that there may be additional fees incurred at local and county levels. Check with local municipalities and county codes for further information.
Arkansas Contractors Exam
The Arkansas Business & Law test is administered by Prometric. Those wishing to register must follow these instructions:
- Call 1-888-763-0131 or visit www.experioronline.com
- Register for ARO4 Program name.
- Exam Code 100
- The operator will assist you in finding the nearest Testing Center.
- The test is administered 6 days a week (M-F 8:00 a.m. – 8:00 p.m., Sat 8:00 a.m. – 4:00 p.m.)
- Payment – The charge for the test is $80.00. Prometric will accept VISA, MasterCard, American Express or a check can be drafted from your checking account. (Have a check ready for relaying the appropriate numbers)
- You will receive a confirmation number and directions to the testing center.
- The test is open book, multiple choice, and 50 questions, with a 2-hour time limit.
- The book (Contractors Guide to Business, Law and Project Management, Arkansas Edition) is available directly from the Publisher at http://www.nascla.org
- No handwritten or additional notes are allowed in the reference book (No letters, words, diagrams, etc.) Highlighting and permanent tabbing is acceptable.
On the day of your exam, arrive at the Prometric Center 30 minutes early to complete the required admission procedures. Make sure to bring with you:
- Government Issued Photo ID. This can be a driver’s license, passport, etc.
- Contractors Guide to Business, Law and Project Management, Arkansas Edition.
Verify your exam code before taking the test, and make sure that to have Prometric give your test results to you before you leave the testing center. Result sent by Prometric can take up to several weeks, postponing the approval and release of your license.
Arkansas Contractors License Application
The Arkansas Contractors License Application can be found online here. The instructions state specifically not to leave any sections blank, but instead to write “N/A” in any sections that do no apply.
Depending on whether or not you’re planning on accepting bids for contracts over $750,000 or not, you’ll want to decide whether or not you’re applying for a Restricted License. The application is the same either way, though different pages of the application will apply to you.
The application asks for your name, phone number, address, social security, and a list of references, as well as specific questions concerning military duty, credit history, and criminal background.
When completed, send the application packet, including the signed affidavits, references, proof of surety bond, proof of Arkansas Business & Law Test passing score, and proof of Worker’s Compensation insurance, along with the non-refundable $100 filing fee, by mail to:
Contractors Licensing Board
4100 Richards Road
North Little Rock, Arkansas 72117
Main Phone: (501) 372-4661
Fax: (501) 372-2247
https://aclb.arkansas.gov/
Arkansas Contractor Registration and Permitting Requirements
Arkansas has a variety of planning, zoning, and construction permits that may be required before your construction project can begin. The most common licenses and permits you may need include:
- Alarm Permit
- Building Permit
- Business License and/or Tax Permit
- Health Permit
- Occupational Permit
- Signage Permit
- Zoning Permit
Check with local cities and counties for specific registration and permitting requirements within their jurisdiction.
Arkansas State Business Licenses and Registration
All contractors wishing to do business in the State of Arkansas must register their business as a DBA or incorporated body such as a corporation, limited liability company, or partnership, with the Arkansas Secretary of State. Businesses and independent contractors must have liability insurance and the appropriate contractor bonds in order to commence work or bid on projects.
Arkansas Tax Identification Numbers and Registration
The Arkansas Department of Finance and Administration oversee all taxation matters in the state. This includes information on Sales and Use Tax, as well as a variety of other matters.
Businesses in Arkansas will also have to register with the IRS to obtain an Employer Identification Number. Check out the Employer ID Numbers (EINs) webpage for specific information on applying for an EIN.
Arkansas Workers’ Compensation Insurance Requirements and Forms
Arkansas law requires all employers to secure workers’ compensation insurance for their employees prior to hiring. More information can be found on the Arkansas Workers’ Compensation Commission website.
Arkansas Contractor License Search and Verification
Search for licensed contractors by contractor class or specialty by entering their name, ID Number, or License Number via the Arkansas Contractor License Lookup tool.