Virginia Contractors License Bonds
Virginia Contractor License Bond Information
The State of Virginia requires a $50,000 contractor license bond for Class A and Class B Contractors as an alternative to satisfying the net worth requirement. Virginia Class A contractors are defined as those who work with contract values of $120,000 or more per job or $750,000 or more for the annual period. Class B contractors are defined as those who work with contract values ranging from $10,000 to $119,999 per job or $150,000 or more for the annual period. Class C contractors are not subject to the bond requirement. The bond generally guarantees ethical conduct and payment of any applicable judgments against the contractor up to the required bond amount.
Many cities, counties and other local jurisdictions in Virginia also require contractor surety bonds. A few examples include; Arlington, Chesapeake, Fairfax Falls Church, Hampton, Lynchburg, Martinsville, Newport News, Portsmouth, Prince William, and Roanoke.
How Much Does a Contractor Bond Cost in Virginia?
Bonds up to $25,000
1-Year Bond Starts at $100.00
1% of the Bond Amount
What does a Contractor Bond Protect Against?
The contractor surety bond ensures that the bonded contractor will faithfully observe and fully comply with all state laws governing contractors and the provisions of Chapter 11 (§ 54.1-1100 et seq.) of Title 54.1 of the Code of Virginia, Board regulations. This surety bond is filed with the Virginia Board for Contractors Board per the provisions of §§ 54.1-1106 and 1108 of the Virginia Code to enable the contractor to legally obtain a license pursuant to the provisions of those statutes and § 54.1-1109.
Getting Your Virginia Business License or Registration
The Virginia Board for Contractors is tasked with licensing businesses engaged in the construction, repair, removal, or other improvements to facilities and structures on property owned by third parties. Contractor licenses in Virginia are divided into two components. The first component is the class of license which is A, B, or C. The Class determines the monetary value of contracts or projects that may be performed. The second component is classification or specialty, which determines what specific type of work permitted under the license.
Following are the basic steps involved in applying for a contractor's license in Virginia.
Complete the Contractor firm license application
- Required of Class A, B, and C
- Required of business entities and sole proprietors, but not individuals
Furnish or complete Financial Verification Forms
- Required of Class A and B applicants only
- Verification of net worth/equity (either a Surety Bond or Financial Statement Form)
Complete the Contractor Experience Verification Form
More on Virginia State Contractor License Classifications.
The Virginia Board for Contractors issues licenses three classes: Class A, Class B and Class C. The type of license applied for is usually based on the value or contract price of the projects the business will be bidding on or engaged in. The state uses the following definitions for each contractor business license class.
- Class A contractors perform or manage construction, removal, repair, or improvements when (i) the total value referred to in a single contract or project is $120,000 or more, or (ii) the total value of all such construction, removal, repair, or improvements undertaken by such person within any twelve-month period is $750,000 or more.
- Class B contractors perform or manage construction, removal, repair, or improvements when (i) the total value referred to in a single contract or project is $10,000 or more, but less than $120,000, or (ii) the total value of all such construction, removal, repair, or improvements undertaken by such person within any twelve-month period is $150,000 or more, but less than $750,000.
- Class C contractors perform or manage construction, removal, repair, or improvements when (i) the total value referred to in a single contract or project is over $1,000 but no more than $10,000, or (ii) the total value of all such construction, removal, repair, or improvements undertaken by such person within any twelve-month period is no more than $150,000.
Other Helpful Information and Links
Pursuant to the Code of Virginia (§54.1-111(6)), it is unlawful to materially misrepresent facts in an application for licensure, certification, or registration. Violations are subject to criminal prosecution, which may result in a conviction along with a jail sentence or monetary fines.
Contractor’s licenses are issued for two year terms, expiring the same month in which the license was issued.
Pursuant to the Code of Virginia (§59.1-69), fictitious names or trade names must be registered in Virginia with either the State Corporation Commission or the Circuit Court of the locality within which the company plans to conduct business.
Licensed contractor businesses must maintain licenses as set forth in See Part V. Standard of Practice and Conduct of the Board for Contractors Regulations.