TEXAS CONTRACTOR BUSINESS LAW
EXAMINATION
PRACTICE QUESTIONS WITH ANSWERS AND
RATIONALES
SECTION 1: LICENSING REQUIREMENTS (Questions 1–15)
Question 1: Which Texas agency is primarily responsible for licensing and regulating air
conditioning and refrigeration contractors?
Answer: Texas Department of Licensing and Regulation (TDLR).
Rationale: The TDLR is the state agency responsible for licensing and regulating various trades,
including air conditioning and refrigeration contractors under Occupations Code Chapter
1302. The Texas Department of Insurance handles insurance matters, not contractor licensing.
The Texas State Board of Plumbing Examiners regulates plumbers. There is no single "Texas
Contractor Licensing Board" for general contractors.
Question 2: Under Texas law, which of the following must hold a state-issued contractor
license?
Answer: Air conditioning and refrigeration (ACR) contractors.
,Rationale: Texas law requires ACR contractors to hold a license under Occupations Code
Chapter 1302. General contractors, home builders, and remodelers are NOT required to hold a
state-level license in Texas. Electricians are licensed by TDLR, and plumbers are licensed by
TSBPE.
Question 3: What is the minimum experience requirement for an air conditioning and
refrigeration contractor license applicant in Texas?
Answer: Applicants must satisfy the experience requirements of Occupations Code § 1302.255
based on the date the application is filed.
Rationale: TDLR Administrative Code Chapter 75, Section 75.20 requires applicants to satisfy
the experience requirements of Occupations Code § 1302.255. The specific experience
requirements vary based on the type of license (Class A or Class B) and the date the application
is filed.
Question 4: Under Texas law, a person may not engage in air conditioning and refrigeration
contracting unless the person holds what type of license?
Answer: An air conditioning and refrigeration contractor license.
Rationale: Occupations Code § 1302.251(a) states: "A person may not engage in air
conditioning and refrigeration contracting unless the person holds an air conditioning and
,refrigeration contractor license." A person holding such a license may assign that license to only
one permanent office of one ACR contracting company.
Question 5: Texas does NOT require a state-issued license for which type of contractor?
Answer: General commercial building contractor.
Rationale: Texas is one of the few states that does not require a state-issued general contractor
license. General contractors, home builders, and remodelers do not need a license at the state
level, though many cities and counties have their own local registration or permit
requirements. Electricians, plumbers, and HVAC/ACR contractors do require state credentials.
Question 6: What is the primary purpose of the Texas Department of Licensing and Regulation
(TDLR) regarding contractors?
Answer: To license and regulate various industries, including construction trades.
Rationale: The TDLR's primary purpose regarding contractors is to license and regulate various
industries, including construction trades. TDLR does not provide free contractor training,
enforce local building codes, or issue general contractor licenses to all builders.
Question 7: Under Texas law, a contractor's license may be assigned to:
Answer: Only one permanent office of one contracting company.
, Rationale: Occupations Code § 1302.251(c) provides that a person holding an air conditioning
and refrigeration contractor license "may assign that license to only one permanent office of one
air conditioning and refrigeration contracting company."
Question 8: A contractor must notify TDLR of any change in license information within how
many days?
Answer: 30 days.
Rationale: Texas law generally requires licensees to notify TDLR of changes in license
information (address, personnel, business structure) within 30 days of the change. This is a
standard requirement across TDLR-regulated trades to ensure accurate records and
communication.
Question 9: Which of the following is required for a contractor to legally perform work in
Texas?
Answer: Compliance with applicable licensing, insurance, and local permitting requirements.
Rationale: To legally perform work in Texas, a contractor must comply with applicable licensing
requirements (for regulated trades), maintain required insurance, and obtain necessary local
permits. General contractors do not need a state license but must comply with local registration
requirements.
EXAMINATION
PRACTICE QUESTIONS WITH ANSWERS AND
RATIONALES
SECTION 1: LICENSING REQUIREMENTS (Questions 1–15)
Question 1: Which Texas agency is primarily responsible for licensing and regulating air
conditioning and refrigeration contractors?
Answer: Texas Department of Licensing and Regulation (TDLR).
Rationale: The TDLR is the state agency responsible for licensing and regulating various trades,
including air conditioning and refrigeration contractors under Occupations Code Chapter
1302. The Texas Department of Insurance handles insurance matters, not contractor licensing.
The Texas State Board of Plumbing Examiners regulates plumbers. There is no single "Texas
Contractor Licensing Board" for general contractors.
Question 2: Under Texas law, which of the following must hold a state-issued contractor
license?
Answer: Air conditioning and refrigeration (ACR) contractors.
,Rationale: Texas law requires ACR contractors to hold a license under Occupations Code
Chapter 1302. General contractors, home builders, and remodelers are NOT required to hold a
state-level license in Texas. Electricians are licensed by TDLR, and plumbers are licensed by
TSBPE.
Question 3: What is the minimum experience requirement for an air conditioning and
refrigeration contractor license applicant in Texas?
Answer: Applicants must satisfy the experience requirements of Occupations Code § 1302.255
based on the date the application is filed.
Rationale: TDLR Administrative Code Chapter 75, Section 75.20 requires applicants to satisfy
the experience requirements of Occupations Code § 1302.255. The specific experience
requirements vary based on the type of license (Class A or Class B) and the date the application
is filed.
Question 4: Under Texas law, a person may not engage in air conditioning and refrigeration
contracting unless the person holds what type of license?
Answer: An air conditioning and refrigeration contractor license.
Rationale: Occupations Code § 1302.251(a) states: "A person may not engage in air
conditioning and refrigeration contracting unless the person holds an air conditioning and
,refrigeration contractor license." A person holding such a license may assign that license to only
one permanent office of one ACR contracting company.
Question 5: Texas does NOT require a state-issued license for which type of contractor?
Answer: General commercial building contractor.
Rationale: Texas is one of the few states that does not require a state-issued general contractor
license. General contractors, home builders, and remodelers do not need a license at the state
level, though many cities and counties have their own local registration or permit
requirements. Electricians, plumbers, and HVAC/ACR contractors do require state credentials.
Question 6: What is the primary purpose of the Texas Department of Licensing and Regulation
(TDLR) regarding contractors?
Answer: To license and regulate various industries, including construction trades.
Rationale: The TDLR's primary purpose regarding contractors is to license and regulate various
industries, including construction trades. TDLR does not provide free contractor training,
enforce local building codes, or issue general contractor licenses to all builders.
Question 7: Under Texas law, a contractor's license may be assigned to:
Answer: Only one permanent office of one contracting company.
, Rationale: Occupations Code § 1302.251(c) provides that a person holding an air conditioning
and refrigeration contractor license "may assign that license to only one permanent office of one
air conditioning and refrigeration contracting company."
Question 8: A contractor must notify TDLR of any change in license information within how
many days?
Answer: 30 days.
Rationale: Texas law generally requires licensees to notify TDLR of changes in license
information (address, personnel, business structure) within 30 days of the change. This is a
standard requirement across TDLR-regulated trades to ensure accurate records and
communication.
Question 9: Which of the following is required for a contractor to legally perform work in
Texas?
Answer: Compliance with applicable licensing, insurance, and local permitting requirements.
Rationale: To legally perform work in Texas, a contractor must comply with applicable licensing
requirements (for regulated trades), maintain required insurance, and obtain necessary local
permits. General contractors do not need a state license but must comply with local registration
requirements.
