How to Meet Bonding Requirements
ARS 42-1305.02 requires that building authorities obtain a certificate from the Arizona Department of Revenue to ensure that the bonding requirement has been met prior to issuing any building permits for projects of $50,000 or more in value. This requirement can be fulfilled in several ways:
- A contractor may present one of the following types of certificates prior to being issued a building permit:
- An annual bond exemption certificate (please make sure to verify that the expiration date has not passed)
- A bond certificate one-time exemption
- A receipt for a bond identifying the location of the project
- If the bond exemption has expired, or the contractor does not have an exemption certificate, they can call the Arizona Department of Revenue at 602-542-4576 or 800-634-6494 (toll-free).
- If the contractor qualifies for exemption, a one-time exemption will be issued for the specific project for which the building permit is being requested. The one-time exemption will be faxed to the building authority and/or be followed with a call to let the building authority know that the building permit can be issued.
- If qualified, the contractor will receive an annual exemption certificate within three days.
- When contractors do not qualify for the exemption, the Department of Revenue will let them know what to do next. The contractor may be required to submit a copy of their contract for the project, along with a Request for Bond Certificate. After the Department of Revenue either determines that the contractor is exempt or the contractor must submit a bond, a one-time exemption or receipt for bond identifying the project location will be issued. A copy of the certificate or receipt will be faxed to the building authority to let them know that the building permit can be issued.
For any questions regarding these procedures, or assistance to contractors, please call the State’s Bonding Compliance Officer at 602-542-4576 or 800-634-6494 (toll free).