As covered previously by the Surety Bond Insider, new legislation signed into law last June becomes effective on January 1, 2016. This new law, Senate Bill 574, requires that all restoration contractors in Oregon must obtain and submit a $10,000 surety bond to the Oregon Construction Contractors Board (CCB) in order to be licensed.

Contractors in Oregon

There are many different types of endorsements available to contractors in Oregon, all of which have different requirements and determine what kind of work the contractor may or may not engage in. Therefore, it is of the utmost importance for applicants to ensure that they are obtaining the correct endorsement for their line of work. For example, a contractor with a commercial general endorsement may work on any number of unrelated trades (e.g. masonry, roofing, etc.) that involve commercial structures or projects, whereas a contractor who possesses a home inspector service endorsement is limited solely to work relating to home inspection.

What are restoration contractors?

Restoration work is defined by SB 574 as services undertaken— non-routine cleaning, water removal, personal property inventory— because of damage to the structure, or to the contents of the structure as a result of man-made or natural disaster. The bill also lists boarding up damaged structures against weather or unauthorized entry and debris removal, so long as demolition work is not required, as work to be done by a contractor with the restoration endorsement. Applicants should be aware, however, that restoration contractors may only operate in residential or small commercial structures, and obtaining an endorsement for restoration work does not entitle them to perform any additional contractor work.

Punitive Action

When submitting a surety bond to the CCB for licensure, restoration contractors are guaranteeing their performance in accordance with all Oregon Revised Statutes. If it is discovered there are any inconsistencies between the contractor’s performance and what is mandated by law, resulting in damages or financial loss, it may result in a claim against the bond and the contractor will be financially indebted to the surety company that issued the bond for the full bond amount upon settlement of the claim.  Since the bond goes into effect on January 1, any restoration contractor who performs work after that date without first obtaining a bond may be fined and incur additional penalties, including denial or revocation of a license.

For more information on Oregon contractor bonding requirements, be sure to visit our dedicated bond page.