LEGISLATIVE FISCAL ESTIMATE

SENATE, No. 4841

STATE OF NEW JERSEY

221st LEGISLATURE

 

DATED: JANUARY 7, 2026

 

 

SUMMARY

 

Synopsis:

Clarifies licensure requirements of home improvement and home elevation contractors.

Type of Impact:

Annual State expenditure and revenue increases.

Agencies Affected:

Department of Law and Public Safety.

 

 

Office of Legislative Services Estimate

Annual Fiscal Impact

 

 

 

 

State Revenue and Expenditure Increases

Indeterminate

 

 

·         The Office of Legislative Services (OLS) finds that this bill’s provisions expanding who may perform home improvement or home elevation services to include, in addition to licensed individuals, those individuals working under the direction of a licensed individual, may result in an indeterminate annual State revenue increase from application fees, licensure fees, fines, and penalties.  

·         Additionally, increased expenditure costs from licensure enforcement may be incurred by the Division of Consumer Affairs.  However, the OLS cannot determine the potential costs to the division due to the uncertainty regarding the number of individuals or contractors who will be regulated and the specific operational decisions the New Jersey State Board of Home Improvement and Home Elevation Contractors will make to implement this bill.

 

BILL DESCRIPTION

 

      This bill expands those individuals who may perform home improvement and home elevation services.  Current law requires individuals who provide home improvement and home elevation services to be licensed by the New Jersey State Board of Home Improvement and Home Elevation Contractors.  The bill expands those individuals who may perform these services to also include individuals working under the direction or supervision of an individual licensed by the board.

 

 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received.

 

OFFICE OF LEGISLATIVE SERVICES

 

      The OLS finds that this bill’s provisions expanding who may perform home improvement or home elevation services to include, in addition to licensed individuals, those individuals working under the direction of a licensed individual, may result in an indeterminate annual State revenue increase from application fees, licensure fees, fines, and penalties.  Additionally, increased expenditure costs from licensure enforcement may be incurred by the Division of Consumer Affairs.  However, the OLS cannot determine the potential costs to the division due to the uncertainty regarding the number of individuals or contractors who will be regulated and the specific operational decisions the New Jersey State Board of Home Improvement and Home Elevation Contractors will make to implement this bill.

     

      State Expenditure Increase: This bill expands those individuals who may perform home improvement and home elevation services to include those who work under the direction of a licensed contractor.  This provision may result in an increase in the number of individuals seeking a home improvement services or home elevation services license or a decrease in the number of individuals seeking a license who alternatively choose to work under the supervision of another licensed contractor.  In any event, the OLS cannot determine the cost impact to the division due to the lack of information regarding the number of individuals or contractors affected and potential changes in enforcement procedures.

     

      State Revenue Increase: The bill may increase annual State revenue collections from application fees, licensure fees, fines, and penalties by indeterminate amounts.  The OLS cannot quantify the application or licensure fee the board will collect from licensure requirements, as it is unknown how many licenses will be issued, especially with the bill's expansion allowing individuals to work under the direction or supervision of a licensed contractor.  In 2023, the Office of the Attorney General estimated there would be nearly 45,000 practitioners who may be licensed.

      The OLS anticipates that the State may annually collect indeterminate fines and penalty payments from violators of statutory and regulatory requirements. 

 

      Home Improvement and Home Elevation Contractors Background: Since 2006, the New Jersey Contractors’ Registration Act and home improvement contractor regulations require home improvement contractors to register with the Division of Consumer Affairs, with the home elevation contractor registration requirement added in 2014.  To register, a home improvement contractor is required to provide proof of liability insurance, disclose a legitimate business address, and provide other information about the business.  Contractors are to display their registration number on all contracts, advertisements, and commercial vehicles as a reference for consumers.  According to the Division of Consumer Affairs, in 2022 there were 2,310 consumer complaints against contractors and home improvement contractors.  The OLS notes that the application fee charged by the Office of Consumer Protection to regulate home improvement and home elevation contractors is $110, and the annual fee thereafter is $90.

 

 

Section:

Law and Public Safety

Analyst:

Kristin Brunner Santos

Lead Fiscal Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

 

 

This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

 

This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).