A professional contractor is always the right choice, and for many reasons. He’s licensed and insured, and he probably has a list of references that you can check.
Who Is Required To Be Licensed
A Tennessee contractor's license is required BEFORE bidding or offering a price, for projects $25,000 and up (includes materials and labor), as a prime (general) contractor; and also subcontractors performing electrical, mechanical, plumbing, HVAC, roofing and masonry are also required to be licensed as a contractor when the total portion on the project is $25,000 or more; masonry, when $100,000 or more. In addition, a sub to a sub would need to be licensed whenever there are more than one (1) subcontractors on the project. Reciprocal agreements do NOT allow using another state's license in Tennessee, but provides a trade exam waiver, only. License issuance takes 4 to 6 weeks and must be approved by the Board during regularly scheduled meetings.
Residential Continuing Education (RCE)
Public Chapter 186 – Residential Continuing Education
A new provision in the law requires Residential contractors, only those licensed after January 1, 2009, with a residential license classification of BC-A, BC-A/r, Spec Homebuilders, or BC-A,b(sm), will be required to obtain eight (8) hours of Board-approved Residential Continuing Education (RCE) as a prerequisite to renewing.
Active, non-lapsing membership in the West TN HBA fulfills this requirement in full..
- License Name and Mode of Operation - A contractor's license is obtained as a Sole Proprietor, Corporation, Partnership or LLC, and issued in the exact name listed on the financial statement, which is provided by the owner of the entity (FYI - designated Qualifying Agents are not considered the owner of the license). Contractors must bid in the exact name listed on the license.
- Exams – The “Tennessee Business and Law” exam is required by ALL new license applicants, (except for BC-A/r), in addition to any applicable “Trade” Exam which may be needed to obtain many classifications such as Building (Residential, Commercial and Industrial); Electrical; Mechanical (Plumbing, HVAC, Fire Sprinkler); and Masonry. Each exam cost is $57.00 and PSI is the exam vendor. See "Classification Outline" for all classifications without a trade exam.
- Reciprocal – The Board has a trade exam reciprocal agreement with several states (see overview below). This waives the trade, only; Business and Law is NOT waived.
- Qualifying Agent (QA) - Person who passed the exam(s) and may be taken by an owner, officer or full-time employee. (FYI - The license does not belong to the QA unless they also the owner of the business entity providing the financial statement.)
- Classifications – All licenses are assigned a classification, such as BC (Building); CE (Electrical); CMC (Mechanical); HC (Heavy Construction); HRA (Highway, Railroad & Airport); LMC (Masonry); MU (Municipal Utility); Environmental; and Specialties (landscaping, excavation, roofing, cell towers, solar panels, audiovisual, etc.,). Classifications are derived from Rule 0680-1-.16 and see a compilation in the "Classification Outline" Classification must cover 60% of the total project in order to bid, unless they have a commercial classification, and then they may bid but would be required to subcontract to a properly licensed contractor for the portions over $25,000. See TCA 62-6-111
- Monetary Limit - All licenses are issued with a monetary limit, an amount approved for contracting/bidding, and this is based upon your financial statement prepared by a CPA.
- Financial Statement – Review or Audit is required and must be prepared by a CPA.
Proof of Insurance – General Liability and Workers’ Compensation
- Secretary of State – For those operating as a corporation, general partnership or LLC, you must be sure to register with the Tennessee Secretary of State at https://tnbear.tn.gov/ecommerce/default.aspx
- License Application - Provide a list of owners, officers, and qualifying agent (QA) information; experience, history, and disclosures (prior licenses; convictions; judgments; law violations; disciplinary actions; complaints, including ones closed, etc.,). Those with a complaint history, such as complaints on file (open or closed); judgments; revocations; or felony convictions; or discrepancy such as lack of experience, the contractor applicant must interview with a Board member at a regularly scheduled meeting.
- Deadline Date to Submit Application - The application must be submitted by the 20th of the month prior to the Board meeting. If the 20th is not on a business day, it would be the next business day after the 20th. See the meeting dates from the Board website's Public Meeting Information
Application Fee - $250.00 and issued for two (2) years.
- License Approval - It takes approximately 4 to 6 weeks to be granted a license (do NOT contract, bid or offer prior to obtaining a license). Board review and approval are required and this is at their regularly scheduled meetings (see Public Meeting Information for dates). An appearance or interview with the Board may be waived as long as there is not a complaint history, conviction, or judgment by any of the individuals or qualifying agents applying for a license; or for ones who did not take the exams, such as the BC-A/r (restricted limited residential license); and if there is not any experience provided. If an interview is required, the qualifying agent and the owner (if different) must both appear.
For more information, please visit https://www.tn.gov/commerce/regboards/contractor.html