Alabama Contractor Licensing in 2026: Full Requirements Plus What Act 2026-396 Exempts

Alabama requires a general contracting license for non-residential work, including swimming pools, once labor and materials total $100,000 or more ($5,000 for pools), issued by the Alabama Licensing Board for General Contractors (LBGC) after an application, a financial statement, and the Business and Law exam. On September 10, 2026, the Board announced that Act 2026-396 amends Section 34-8-7 of the Code of Alabama, effective October 1, 2026, adding exemptions for residential swimming pools and five categories of routine maintenance that did not exist before.

At a glance

• A non-residential license is required at $100,000 or more in labor and materials; $5,000 or more for swimming pool work (Ala. Code 34-8-1, 34-8-7).
• Act 2026-396 exempts residential pools and five routine-maintenance categories from the general contracting law, effective October 1, 2026.
• Residential home building is licensed separately, by the Home Builders Licensure Board, not the LBGC.
• Bid limits run up to 10 times net worth or working capital, except for contractors holding an unlimited license (Ala. Admin. Code 230-X-1-.02).
• The prime application fee is $300; subcontractors pay $150, furnish references instead of a financial statement, and sit for no exam.

That undersells how unusual this act is. Read against the law it replaces, Act 2026-396 takes an entire trade that was expressly barred from every exemption in the statute and moves it into the exemption list. It also writes five new categories of work out of the licensing requirement entirely, and leaves the Board a deliberately wide power to decide what counts. Here is what actually changed, what it does not change, and how Alabama licensing works for everyone else who is not touched by the act.

New to licensing in Alabama? For every other state, see how to get a contractor license in each state. The Licensing Company also tracks licensing services in all 50 states for companies that need to qualify in more than one jurisdiction.

Who actually needs a general contractor license in Alabama

Alabama splits contractor licensing across two boards, and search traffic for "how to become a general contractor in Alabama" conflates them more often than not.

Notes on the table:

• The $100,000 figure is current. Act 2024-277 raised it from $50,000, effective October 1, 2024.
• The $5,000 swimming pool threshold is separate and did not change in 2024.

If you build or remodel single-family homes, the board that licenses you is the Home Builders Licensure Board (HBLB), under Chapter 14A of Title 34, not the LBGC covered through the rest of this article. The HBLB runs its own exam and application process, and working as a residential home builder without its license is a Class A misdemeanor under Ala. Code 34-14A-14. If your work is residential, start at the Home Builders Licensure Board's site instead. Commercial, industrial, public, and other non-residential work falls under the LBGC and Section 34-8, covered in our Alabama contractor license requirements guide and the rest of this article.

What the old law said about swimming pools

Before this act, Section 34-8-7 had a subsection (b) that read:

"The exemptions provided in subsection (a) shall exclude a swimming pool contractor. Provided, however, a person, firm, or corporation constructing a swimming pool on his, her, or its own property shall be exempted from this chapter."

In plain terms: whatever exemptions the rest of the statute offered, a swimming pool contractor did not get them. The only pool work that escaped was a property owner building a pool on their own land.

Act 2026-396 deletes that subsection. The entire carve-out is struck.

At the same time, the act rewrites the residence exemption at subsection (a)(2). It previously covered "the construction or repair of any residence or private dwelling." As amended it reads:

"The construction or repair of any residence or private dwelling or any residential swimming pool."

So residential pool contractors go from specifically excluded from every exemption to specifically named in one. That is not a tweak at the margin. For a whole category of contractor, the licensing question flipped on October 1.

Two boundaries are worth stating clearly, because this is where people will over-read the change:

• The exemption covers residential swimming pools. Commercial pool work, hotels, apartment complexes, municipal facilities, clubs, is not named in the amended (a)(2), and the $5,000 pool threshold keeps applying to that work.
• Exemption from the general contracting license is not exemption from everything else. Building codes, permits, electrical and plumbing licensing where those trades are separately regulated, and local city or county requirements all continue to apply on their own terms. Alabama's Board is explicit elsewhere that municipalities may impose their own requirements.

The five new exemption categories

Beyond pools, the act adds new subdivisions to the exemption list. In the enrolled text they are:

Routine or regular maintenance of utility infrastructure, at subsection (a)(5): repair, maintenance, replacement, reinstallation, or removal of facilities, equipment, or systems used in generating, transmitting, or distributing electric power, natural gas, or telecommunications, on a routine, regular, or recurring basis, by a Public Service Commission-regulated utility or its contractors, under licensed architect or engineer supervision. This is separate from the existing emergency utility exemption at (a)(4), which the act leaves in place.

Routine or regular maintenance of equipment and technological systems, "routine or regular maintenance, repair, replacement, reinstallation, or removal of equipment, specialized technological processes, or equipment facility systems as determined by the board with regard to scope, frequency, and specialty of the work to be performed."

Routine or regular maintenance, repair, or removal of four named things, again "as determined by the board with regard to scope, frequency, and specialty":

• existing security and access control systems
• existing lighting and filter systems
• existing plumbing, air conditioning, and electrical systems
• existing paint on painted surfaces

Routine cleaning, waste disposal, and janitorial services, including the cleaning, stripping, and waxing of floors.

Routine landscape maintenance, cutting grass; trimming, replacing and removing bushes, shrubs and similar items; placement and removal of pine straw, mulch, bark and similar ground covers; and pressure washing services and other routine ground maintenance.

The third bullet in that second group is the one to sit with. Routine maintenance and repair of existing plumbing, air conditioning and electrical systems is a large amount of commercial service work. A facilities maintenance contractor who has been carrying a general contractor license largely to stay clean on service calls may find, now that the act is in force, that a meaningful share of that work is outside the licensing requirement, and below the $100,000 threshold besides.

The trap: "as determined by the board"

Notice the phrase attached to both maintenance exemptions. The work is exempt as determined by the board with regard to scope, frequency, and specialty.

The statute does not define "routine." It does not define "regular." It hands the Board the authority to draw those lines, and the Board has not yet drawn them publicly.

The Board said so itself, in the same notice announcing the change:

"Because the law does not define every situation that may qualify as routine or regular maintenance, questions regarding specific projects should be addressed with the Board before bidding on or beginning work."

That is a regulator telling contractors, in advance, that the safe harbor has undefined edges and to ask before bidding. It is good advice and it should be taken literally. A contractor who reads "routine maintenance of existing plumbing systems" as covering a full system replacement is going to find out where the line is the expensive way, and in Alabama, working outside a required license is not a paperwork problem. See our guide to working without a contractor license for what that exposure looks like generally.

The practical posture until the Board issues guidance: treat the new maintenance exemptions as real but narrow, and get a written answer on anything near the line.

What did not change

Several things people will assume changed, did not.

The rest of the exemption list is intact, including some provisions worth knowing:

• Government work by an authorized representative of the United States, the State of Alabama, or an incorporated town, city or county, under the supervision of a licensed architect or engineer, with contracted-out work still having to comply.
• Owner-builders. A person, firm or corporation building on their own property is exempt, provided contracted-out work complies. This one has teeth: the statute says a municipal governing or regulatory body may not enact any ordinance or law restricting or altering this exemption, and that any conflicting municipal ordinance was repealed effective June 11, 2015.
• Emergency utility work by Public Service Commission-regulated utilities and their contractors, under licensed architect or engineer supervision. The statute defines "emergency" with a number most people miss: a situation where service has been interrupted, or may be interrupted if the remedial work is not performed and completed within 60 days, plus other situations the Board deems an emergency in its discretion.
• Temporary labor, at Section 34-8-7(a)(8), clarified by Act 2024-277. Labor brokers providing workers to a general contractor who supervises and controls them are exempt, and "for the purposes of licensing, temporary workers are deemed to fall under the license of the general contractor to whom they are provided." The limit is explicit: this does not allow labor brokers to act as subcontractors or to assume a scope of work for a project as a subcontractor.

And the licensing requirement itself is unchanged. This act adds exemptions. It does not alter who must be licensed when no exemption applies, it does not change the license classifications, and it does not change the Board's experience or examination requirements.

On the dollar threshold, covered in the table above: Act 2026-396 does not touch the $100,000 or $5,000 figures, it only adds exemptions for specific kinds of work regardless of contract value. The Board can be reached at 445 Dexter Ave, Suite 3060, Montgomery, or (334) 272-5030, if a specific project needs confirmation.

How to get a general contractor license in Alabama

For the work this article's exemptions do not reach, the LBGC path runs through four steps:

1. Confirm the LBGC, not the HBLB, is the right board, using the table above.
2. Assemble a financial statement. Bid limits are set from net worth and working capital, with a $10,000 minimum in each for the lowest classification.
3. File the application with the fee, at least 30 days before a quarterly Board meeting. A prime pays $300; a subcontractor pays $150 and submits three references instead.
4. Sit for the Business and Law exam, if you are a prime, through PSI, the Board's exam vendor. Subcontractors sit for no exam. PSI sets its own fee; third-party figures disagree, so confirm directly.

Alabama also offers reciprocity with Arkansas, Louisiana, Mississippi, North Carolina, and Tennessee: one year of prior licensure in the same classification can waive the trade exam, though the business law exam is still required.

Most bid limits are capped at 10 times net worth or working capital, whichever is lower. An unlimited license is exempt from that formula; confirm the current financial bar with the Board. A bid-limit increase request carries a $50 Board fee.

The subcontractor rules, restated

Act 2026-396 renumbers the subcontractor subsection but leaves its substance in place. It is worth republishing because it is one of the more distinctive sets of rules in the country and it is poorly covered.

A subcontractor in Alabama is subject to the general contracting chapter as a general contractor is, except:

• A subcontractor pays $150 to apply, roughly half of the $300 prime contractor fee.
• No bid limits are established for a subcontractor. Where general contractors work within limits, subcontractors do not have them.
• A subcontractor submits a statement of financial condition with application and renewals, as prescribed by the Board.
• A subcontractor furnishes three references from any combination of licensed general contractors, registered professional engineers, registered architects, or a qualified person as declared by the Board. If the subcontractor has only ever worked for one company, they instead provide three or more jobs worked, the contract amounts, time periods, locations, and a statement of experience.
• A subcontractor is not required to be licensed at the time a project is bid, but must be licensed with the Board before beginning work on it.
• The license number issued to a subcontractor denotes subcontractor status.
• "A subcontractor is not required to sit for any examination before being licensed."

That last provision is genuinely unusual and almost never reported. Alabama licenses subcontractors without an exam, at half the prime fee, with no bid limit, on the strength of a financial statement and three references. For a specialty trade business, that is a materially different on-ramp than the general contractor path, and the bid-timing rule means you can pursue work before the license is in hand, as long as it is in hand before you start.

For how subcontractor licensing compares nationally, see our subcontractor license requirements by state guide.

The legislative trail

For anyone who needs to cite this rather than take our word for it:

• The bill was SB279, sponsored by Senator Chambliss, referred to County and Municipal Government.
• First read February 10, 2026. Passed the Senate, as amended, February 25, 2026. Passed the House April 2, 2026.
• Enacted as Act 2026-396, effective October 1, 2026.
• The act's stated purpose: "to amend Section 34-8-7, Code of Alabama 1975, to provide additional services to the list of exemptions to the requirements of the general contracting law."

The Board has posted the enrolled act on its own site alongside the announcement.

One honest observation for anyone researching Alabama licensing right now: the Board's own Frequently Asked Questions page is currently unpopulated placeholder text. That is not a criticism of an agency that is clearly maintaining its news feed and posting primary documents, but it does explain why so much contradictory third-party information about Alabama licensing circulates, from exam fees to bid-limit charts. When the authoritative summary is missing, aggregators fill the space, and they disagree. Go to the act and the Board.

What contractors should do now that the exemptions are in effect

1. Identify whether any portion of your current book falls into the new exemptions, residential pool work, routine maintenance of existing plumbing, HVAC or electrical systems, janitorial and floor care, landscape maintenance and pressure washing.
2. Do not assume the edges. Where work is near the boundary between routine maintenance and a project, write to the Board and get an answer before bidding. The Board invited exactly this.
3. Do not drop a license on the strength of an exemption. An exemption from the general contracting license is not an exemption from permits, codes, separately regulated trades, or municipal requirements, and your customers, general contractors and insurers may require licensure regardless of what the statute demands.
4. If you are a residential pool contractor, re-read your contracts and your bid pipeline. Work that began before October 1 was governed by the old rule.
5. Watch for Board guidance defining scope and frequency. That guidance, when it comes, will matter more to day-to-day decisions than the statute itself.

We track changes like this across all 50 states in our 2026 contractor license law changes guide.

Owner builder rules in other states

The Alabama owner exemption is one of many, and the details differ by state. If you build on your own property in more than one state, compare the rules in our Georgia owner builder exemption, Louisiana owner builder exemption and Arkansas owner builder exemption guides before you assume the Alabama rule carries over.

Where the qualifier question sits in Alabama

None of this changes the structural reality for a company that does need an Alabama license. Alabama remains one of the clearest states in the country on what the qualifying individual has to be, we covered the statutory language in our Alabama contractor license qualifier guide, and it is worth reading alongside this change, because the two interact.

If an exemption removes part of your work from the licensing requirement, it does not remove the requirement for the rest of it. A company doing exempt routine maintenance and non-exempt construction still needs to be licensed for the non-exempt half, and that license still needs a properly qualified individual standing behind it. A qualifying agent qualifies the company, as an owner or a full time W-2 employee who supervises the work; see what a qualifying agent is and hiring a qualifying agent. Companies that need to fill that role with placed talent, in Alabama or elsewhere, can look at contractor qualifier services.

When no one inside the business can be that person, The Licensing Company places licensed professionals as W-2, full-time employees who serve as the company's qualifying agent. Never a percentage of revenue, never a flat fee to use a credential, never a per-project arrangement, never a 1099. The employment relationship is the compliance line, and it is the first thing a board looks at.

Frequently asked questions

When does Act 2026-396 take effect? October 1, 2026. It amends Section 34-8-7 of the Code of Alabama 1975.

What is the dollar threshold for needing an Alabama general contractor license? $100,000 or more in labor and materials for non-residential work, and $5,000 or more for swimming pool construction. Act 2024-277 raised the general threshold from $50,000, effective October 1, 2024. Act 2026-396 does not change either figure; it adds exemptions for specific kinds of work instead.

Do residential swimming pool contractors still need an Alabama general contractor license? As amended, Section 34-8-7(a)(2) exempts "the construction or repair of any residence or private dwelling or any residential swimming pool," and the old subsection barring swimming pool contractors from the exemptions is deleted. The exemption is written for residential pools. Commercial pool work is not named, and still carries the $5,000 threshold. Exemption from the general contracting license does not remove permit, code, separately licensed trade, or local requirements, and Board guidance on the amended statute should be confirmed before relying on it.

What counts as "routine or regular maintenance" under the new exemptions? The statute does not define it. Both maintenance exemptions apply "as determined by the board with regard to scope, frequency, and specialty of the work to be performed." The Board has stated that questions about specific projects should be addressed to it before bidding on or beginning work.

What is an "unlimited" license in Alabama? A bid-limit classification exempt from the usual cap of 10 times net worth or working capital. The Board sets its own financial bar for unlimited status; confirm the current figure with the Board.

Is a residential home builder licensed by the same board as a general contractor in Alabama? No. General contracting is Chapter 8 of Title 34, under the LBGC. Residential home building is Chapter 14A, under the separate Home Builders Licensure Board.

Do Alabama subcontractors have to take an exam? No. The statute states that a subcontractor is not required to sit for any examination before being licensed. Subcontractors also pay a $150 fee, about half the $300 prime contractor fee, have no bid limits, and need not be licensed at the time of bid, but must be licensed before beginning work.

Where can I read the act? The Alabama Licensing Board for General Contractors has posted the enrolled Act 2026-396 on its website alongside its September 10, 2026 announcement.

The takeaway

Alabama has widened its licensing exemptions meaningfully, and for residential pool contractors it has reversed a rule that singled them out. But the widest of the new exemptions arrive with an explicit instruction from the regulator to ask before you act, because nobody has drawn the line yet between maintenance and construction. The underlying path into Alabama general contracting has not moved: a $100,000 threshold, a financial statement, an application, and an exam for primes.

The contractors who get hurt by changes like this are rarely the ones who missed the news. They are the ones who read the headline, assumed the exemption was broader than it is, and found out at enforcement. Read the act, ask the Board, and keep the license you need for the work that is still regulated. For help placing a qualifying agent on an Alabama license or anywhere else, call 615-219-2110 or start with hiring a qualifying agent.

Act 2026-396 took effect October 1, 2026. Statutory text, effective dates, and Board interpretations are subject to change and to Board guidance not yet issued. Verify current requirements with the Alabama Licensing Board for General Contractors before bidding or beginning work. This article is general information about licensing requirements, not legal advice.

Sources

• Alabama Licensing Board for General Contractors: New Contractor Licensing Exemptions Take Effect October 1, 2026 (retrieved October 12, 2026)
• Alabama Licensing Board for General Contractors: Changes to the Alabama Licensing Board for General Contractors Section of the Code of Alabama (Act 2024-277) (retrieved October 12, 2026)
• Alabama Licensing Board for General Contractors: Contractor Licensing Law summary (retrieved October 12, 2026)
• Alabama Licensing Board for General Contractors: Apply (retrieved October 12, 2026)
• Alabama Legislature (ALISON): SB279, 2026 Regular Session, enrolled bill (retrieved October 12, 2026)
• Alabama Licensing Board for General Contractors Administrative Code, Chapter 230-X-1, Operations of the Board (Rules .02 Bid Limits and .43 Fees for Services) (retrieved October 12, 2026)
• Alabama Home Builders Licensure Board: How to Get Licensed (retrieved October 12, 2026)
• Alabama Home Builders Licensure Board: Home Builders Licensure Law (retrieved October 12, 2026)
• PSI Services: Alabama contractor examination program (retrieved October 12, 2026)