LouisianaSB 1222025 Regular SessionSenateWALLET

CONTRACTORS: Provides relative to the Louisiana State Licensing Board for Contractors. (8/1/25)

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Bill Overview

Analyzed Economic Effects

29 provisions identified: 7 benefits, 15 costs, 7 mixed.

Tougher consequences for contractor violations

People whose contractor license or qualifying-party status is revoked must wait three years before applying again, up from one year. Board or residential subcommittee monetary penalties are due within 90 days unless another law provides otherwise. Unpaid penalties can lead to collection and denial of license or registration issuance or renewal.

Customers get contracts and license safeguards

Services requiring a contractor license or registration need a complete written agreement that identifies any documents made part of it. When the license requires insurance, the agreement must include current workers' compensation and liability certificates. Everyone must receive a signed copy at signing, and work cannot start until everyone signs. Contractors lacking a required license cannot file a claim, lien, or privilege for money allegedly owed under that contract. False public license claims, including online claims, are unlawful; lending a license or misrepresenting or fraudulently using another's license also supports discipline.

Contractors face background checks and deadlines

Beginning August 1, 2025, applicants, business principals, and designated qualifying parties must complete applications and pass background checks. Checks cover bankruptcy, judgments, insolvency, liens, and criminal convictions or guilty or no-contest pleas; approval can be denied for cause. The board can request identification and financial or criminal history. Unfinished license applications become invalid one year after submission. Licenses or classifications based on credentials or certifications expire when those credentials or certifications expire.

Contractors face broader discipline and disqualification

The board can discipline contractors over their ability to do contracting work, including concerns involving principals or qualifying parties. These concerns are no longer limited to business history or experience. Beginning August 1, 2025, exam deception bars someone from serving as a qualifying party for three years, up from one. This covers deception while taking or attempting a board exam.

Contractors face minimum net worth requirements

Beginning August 1, 2025, contractor license applicants must submit a financial statement current within 12 months. An accountant, bookkeeper, or certified public accountant must prepare and sign it; the applicant must also sign. Residential, commercial, their subclasses, and most specialty licenses require $50,000 in net worth. Home improvement, mold remediation, and labor-only specialties require $25,000. Applicants below the minimum must provide an irrevocable letter of credit covering the required amount plus any negative net worth.

Contractors must meet project compliance rules

Beginning August 1, 2025, bidders required to hold contractor licenses must provide required bid bonds or insurance when due. Winners must maintain the bonds or coverage required by the bid proposal. Violations can bring license suspension or revocation, fines, and administrative costs. Contractors also face discipline for missing required permits or inspections, starting before a permit is issued, or misstating work value or scope.

Project costs set contractor license requirements

Beginning August 1, 2025, licensing thresholds are $50,000 for commercial and new residential construction, and $1 for hazardous-materials work. Existing-home repairs, improvements, and mold removal reach the threshold at $7,500; electrical, mechanical, and plumbing work at $10,000. Project value includes labor, materials, rentals, and direct and indirect expenses, including items others pay for or donate. Modular-home installation enters the residential contractor category at $50,000, excluding component parts as they leave the factory.

Contractor licenses control work and bidding

Beginning August 1, 2025, contractors can bid and work only within their approved license classifications. They can add classifications by applying, meeting requirements, paying fees, and receiving board approval. Construction managers who offer, bid, or provide oversight need the matching or major classification license, regardless of project value. An owner's employee who only checks plans and specifications, without acting as a contractor, is exempt. Local permits for license-required work require the proper active license; public bid forms and specifications go only to active licensees or authorized representatives.

Home contractors face clearer work limits

Beginning August 1, 2025, the residential exception to commercial classification covers primarily residential buildings with no more than two units. Larger buildings count as commercial for licensing. Contractors holding both building construction and residential construction licenses can build homes taller than three floors. The home improvement classification covers nonstructural projects worth at least $7,500 but less than $50,000. It does not allow structural work, including foundations, load-bearing walls, structural frames, floor slabs, or roofing systems.

Longer contractor renewals carry late limits

Beginning August 1, 2025, eligible contractors can choose one-, two-, or three-year renewal terms. Licenses tied to insurance requirements or certifications cannot use multi-year renewals. Renewals more than 15 days after expiration carry a late fee of no more than $50. The first 15 days carry no late penalty, but this does not make an expired license active. A license left unrenewed for more than one year requires a new application and approval.

Licensees' employees qualify for licensing exemption

Beginning August 1, 2025, the employee licensing exemption covers employees of any contractor-law licensee. It replaces the narrower reference to employees of a contractor.

Contractors face fewer administrative penalty charges

Beginning August 1, 2025, the contractor licensing board loses authority to assess administrative-infraction penalties other than for late license-renewal applications. The separate late-renewal fee rule remains in place. This change does not remove the law's separate disciplinary and civil enforcement powers.

Fewer licensing hurdles for specialty contractors

Beginning August 1, 2025, asbestos removal and abatement license applicants no longer need to show Louisiana environmental department certification. Electrical, mechanical, and plumbing licensees are exempt from the covered contractor-licensing Part when working only within their trade classification. That exemption does not cover work outside their classification.

One crime-based contractor discipline ground ends

The law removes one discipline ground involving a construction-business crime tied to dishonesty, physical harm, or damage to another person. The removed ground covered convictions, guilty pleas, and no-contest pleas. Criminal law remains unchanged, and other licensing discipline grounds can still apply.

Qualified contractors can skip some exams

Beginning August 1, 2025, the board must waive trade exams for comparable out-of-state license holders. The other state must certify a passing classification exam and good standing; Louisiana's business-law exam and other requirements still apply. The board can waive qualifying-party exams and must waive residential construction testing for holders of its building construction license. Louisiana Master Plumber license holders are exempt from the covered contractor trade exam, but separate plumbing-license rules remain.

Contractor oversight can start without complaints

Beginning August 1, 2025, the contractor board and residential subcommittee can address known possible violations without a formal complaint. When setting administrative penalties, they must weigh seriousness, circumstances, cooperation, and past violations. The residential subcommittee's listed licensing powers cover issuing, suspending, and revoking licenses, but no longer include modifying them. Its licensing actions follow the broader contractor licensing law, rather than only one section.

Contractors cannot interpret or adjust insurance

Contractors cannot interpret property insurance policy provisions about coverage or the insured person's duties. They also cannot act as public adjusters for property insurance claims. Advertising or soliciting either service is prohibited. Contractors violate these rules when someone acting on their behalf performs the prohibited conduct, including paid employees or nonemployees.

Arborists lose their contractor exam exemption

Beginning August 1, 2025, state-licensed arborists no longer have the contractor exam exemption. They also lose the former exemption-based authority to bid on and perform specified arborist work statewide. A state arborist license alone no longer provides that exemption.

Contractor applicants must document business qualifications

Beginning August 1, 2025, the board can license any person qualified under the contractor licensing law. Businesses required to register with Louisiana's secretary of state need a certificate of authority in good standing. Applicants must name a qualifying party for each classification and for the business-and-law requirement. A qualified principal or full-time employee can fill these roles after meeting application, exam, and credential requirements. A qualifying party can also serve a licensee's subsidiary.

Contractors face recordkeeping and reporting deadlines

Beginning August 1, 2025, contractors must use their officially licensed or registered name for bids, contracts, business transactions, and work. Licensees must keep unredacted compliance records for five years and provide requested information within five business days. They must report application-information changes in writing within 30 calendar days. The same deadline covers criminal, civil, or administrative actions involving the licensee or a principal in any jurisdiction. Using the wrong name or failing to keep or provide records is grounds for discipline.

Licensing rules for mold and repairs

Beginning August 1, 2025, mold remediation and home improvement are major contractor license categories. Applicants must meet the requirements for their category. Mold remediation applicants must show satisfactory completion of at least 24 hours of training. That training must cover mold cleanup and basic mold assessment.

Residential roofers need licenses and exams

Beginning August 1, 2025, the law defines residential roofing contractors to cover projects worth $7,500 or more. Beginning January 1, 2026, advertising, soliciting, offering, bidding on, attempting, or doing that work requires a Residential Roofing or Residential Construction classification. The rule covers work on any part of a residential roofing system. Residential roofing contractors must pass the roofing trade exam and meet the applicable residential contractor licensing requirements.

Solar installers face specific licensing requirements

Beginning August 1, 2025, installing solar equipment or systems on projects worth $10,000 or more requires a Solar Energy Equipment license. Applicants must already hold a Building Construction, Electrical, Mechanical, or Residential Construction major license. At that threshold, photovoltaic wiring and hookups require an Electrical license. Solar thermal piping and equipment connections require a Mechanical license. Financing, leasing, lease-purchase, and third-party arrangements do not remove these licensing duties.

Government entities lose contractor licensing exemption

Beginning August 1, 2025, Louisiana state and local government entities no longer have a blanket contractor licensing exemption. They must follow the contractor licensing requirements that apply to their work.

Construction programs receive funding after audits

Beginning August 1, 2025, dedicated contractor renewal-fee funds go to eligible public construction management or technology programs by October 1 each year. Payment follows the board's annual audit, shifting funding later in the year. The board can authorize a dedicated $100 yearly renewal fee. Half the funds are split among accredited public universities and community colleges, with each university getting twice each college's share. The other half goes to accredited public universities based on prior-year graduates; funds for schools losing eligibility are redistributed.

Volunteer builders gain access with limits

Beginning August 1, 2025, any person—not just citizens—can use the volunteer licensing exemption for two named grant programs. These are the Louisiana Community Development Block Grant and Louisiana Small Towns Environment Program. The church exemption covers donated labor or services on worship buildings owned by legally established churches. That exemption requires the board's affidavit to obtain a building permit.

Stronger customer rights, more contractor duties

The law gives customers more information and control while adding contract duties for contractors. Covered contractors face discipline for lacking a written contract signed and dated by all parties. Residential construction, home improvement, and mold remediation contractors must provide their name, license number, and classification in writing. Customers can request current liability insurance certificates and proof of workers' compensation coverage. Material changes to plans or specifications require consent from both the owner and the design professional.

Owner-builders must file exemption affidavits

Beginning August 1, 2025, owners using the personal-residence building exemption must submit the board's affidavit to obtain a building permit. The exemption allows no more than one personal residence per year, with exceptions for changes in marital or employment status. The one-year period begins when the residence receives its certificate of occupancy.

Contractor insurance rules allow inactive status

Beginning August 1, 2025, residential construction applicants, including subclassifications, and mold removal and home improvement applicants must show workers' compensation coverage. They also need at least $100,000 in liability insurance or approved liability trust fund protection. Home improvement and mold removal licensees can request inactive status after at least one consecutive year in good standing. Inactive licensees need not submit current insurance certificates, but must meet the same renewal requirements and pay the same fees.

Sponsors & Cosponsors

Sponsor

Mark Abraham
Republican • Senate

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 288 • No: 1

House vote • 6/12/2025

Conference Committee Report read, roll called, yeas 101, nays 0. The Conference Committee Report was adopted.

Yes: 101 • No: 0

Senate vote • 6/12/2025

Conference Committee Report read; adopted by a vote of 35 yeas and 0 nays.

Yes: 35 • No: 0

House vote • 6/8/2025

Read third time by title, roll called on final passage, yeas 94, nays 1. Finally passed, ordered to the Senate.

Yes: 94 • No: 1

House vote • 5/28/2025

Reported with amendments

Yes: 11 • No: 0

House vote • 5/19/2025