HB538 Alabama 2013 Session

Summary

Primary Sponsor

Mack N. ButlerRepresentative

Republican

Co-Sponsors

Allen FarleyPatricia Todd

Session

Regular Session 2013

Title

Contractors and subcontractors, provide further for compliance of subcontractors with licensing requirements, Secs. 34-8-6, 34-8-7 am'd.

Summary

HB538 tightens licensing rules for subcontractors, requires license numbers on bids and contracts, and extends liability relief to bids that include a subcontractor's license number.

What This Bill Does

1) Extends the existing liability relief to also apply when a bid includes the current license number of a subcontractor. 2) Removes the bid-time licensing exemption for subcontractors and requires subcontractors to be licensed before starting work on projects, especially where costs exceed $50,000. 3) Requires license numbers to be included in all construction contracts, subcontracts, bids, and proposals, and strengthens subcontractor licensing requirements (financial statements, references, etc.). 4) Establishes enforcement tools and penalties, including cease-and-desist orders, injunctions, fines up to $5,000 per offense, and the ability to withhold license approvals for violators; it also outlines exemptions and effective date.

Who It Affects

• Subcontractors: must obtain and maintain licensure before beginning work (especially on projects over $50,000), must meet new board requirements (financial statements, references), and would be identified as subcontractor status on licenses; noncompliance could lead to penalties or loss of license opportunities.
• Owners/architects/engineers/construction managers/awarding authorities: would have liability relief when bids include a subcontractor's current license number, and would need to verify license numbers to ensure compliance; they could face enforcement if they fail to follow the licensing rules.

Key Provisions

• Extends liability relief to bids that include the current license number of a subcontractor, making owners/architects/engineers/construction managers/awarding authorities similarly relieved as they are with general contractors.
• Deletes the existing exception that subcontractors are not required to be licensed at bid time; subcontractors must be licensed before beginning work, with licensing tied to project costs (over $50,000).
• Requires license numbers to be included in all construction contracts, subcontracts, bids, and proposals; prohibits entering into contracts with unlicensed subcontractors unless exempt under the act.
• Subcontractor licensing requirements include paying half the general contractor fees, no bid limits for subcontractors, submitting financial statements, and providing three references or equivalent job history.
• Defines that a subcontractor license denotes subcontractor status on the general contractor license, and specifies that subcontractors are not required to sit for certain examinations before licensing.
• Provides enforcement powers for the State Licensing Board for General Contractors, including cease-and-desist orders, injunctions, fines up to $5,000 per offense, summary trials, and potential withholding of license approvals for violators (up to six months).
• Implements exemptions similar to existing law for certain government entities and emergencies; sets an effective date for the act (first day of the third month after passage).

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Contractors