The “Ohio contractor bond” is a blanket term for the different types of surety bond requirements of each city or county in Ohio that regulates contractor licensing and permitting. There is no statewide requirement for contractor licensing, so cities and counties determine their own regulations for contractor licensing and permitting. Most bond amounts required in the state vary between $5000, $10,000, $15,000, and $25,000.
Surety bonds are required to guarantee that the licensed contractor will comply with local regulations as well as fulfill their professional obligations to their clients. If the contractor violates the conditions of their contract, their clients can file a claim against them. The surety company will pay for the costs up to the bond amount.
Here is a comprehensive list of Ohio cities and counties that require a bond and their respective required bond amounts:
Ohio contractor bonds usually start at $100 annually, but the cost also depends on what city or county you live in, your license type, the required bond amount for your jurisdiction, as well as your personal credit score.
Here are some rough guidelines for what prices you can expect based on your needed bond amount and credit score. Please note that the actual quote will vary based on your personal financial situation.
Annual bond costs based on the total bond amounts are normally between 1% and 3% for applicants with good credit scores. A low credit score could cause the cost to be as high as 10% of the total bond amount.
You can usually buy bonds from a specialized surety company online by submitting a quick application. This application usually asks for details of your contracting business, credit score, and other information pertaining to your financial history. After the application is completed, you will be contacted by the company with a quote, informing you of whether or not you received bond as well as the bond cost.
If the company does not sell your Ohio contractor bond, you can try contacting your insurance company or your local insurance agent for guidance. No matter which option you choose, make sure you check your jurisdiction’s licensing requirements and what is needed before you purchase your surety bond.
If you are having difficulty choosing between these options, you can refer to our Where to get a Surety Bond article.
The bond is often a stepping stone to getting the Ohio contractor license. The license itself is handled by the Ohio Construction Industry Examining Board (OCILB). This regulating authority enforces requirements for commercial contractors that are licensed to perform the following: electrical; heating, ventilation, and air conditions (HVAC); plumbing, hydronics; and refrigeration.
The board enforces that you must be at least 18 years of age, never convicted of a felony, and have a minimum of five years of experience in the industry to apply for the license. Your local government may have additional requirements, so check with your local licensing authority for more information.
The board is an overarching authority, so local city and county departments are still in charge of enforcing their own permit and licensing requirements for their contractors. For the City of Cleveland, Ohio, the city’s Building and Housing Department regulates the jurisdiction’s contractor license bonds.
Although contractors in Ohio are often governed by their local jurisdictions, some are still required to obtain their Ohio State License. House Bill 434 of the Ohio Legislature states that local Building Departments can require this license in order to get the same license on the local level. The Ohio State License is for Commercial Contractors for the following trades:
Contractors who are not in the above trades do not require a state licensing. In such cases, a county level license is sufficient.
If you need a state contractor's license, you can get it through the Ohio Construction Industry Licensing Board (OCLIB). OCLIB requires applicants to meet the following requirements in order to acquire a license:
If you meet the above requirements, you can submit an application to the Ohio Department of Commerce, which will process your license. Once the license is acquired, contractors must periodically renew their license by taking relevant online education. To renew the license for 1 year, contractors must conduct 4 hour of online education from an OCLIB approved source. To renew for 3 years, contractors must take up to 12 hours of continuing education.